Advance Beneficiary Notice (ABN)

A form signed by the patient before certain services are rendered, notifying him/her that Medicare or Medicaid may not cover this service and that the patient will be responsible for payment.

Billing Statement

A summary of current activity on an account.


The percentage of medical expenses an insured must pay the provider or facility for covered services. The coinsurance amount is based on eligible charges.


The information billed to the insurance company for services provided.

Copay, Copayment

The fixed amount an insured must pay their provider or facility each time they receive a certain service.


The portion of eligible (covered) expenses that you must pay each year before coverage begins.

Eligible Charges (Allowed Amount)

The maximum dollar amount allowed for covered services rendered by participating providers and facilities or by nonparticipating providers and facilities. Deductibles and coinsurance amounts are calculated from eligible charges. Participating providers and facilities accept this allowed amount as payment in full for covered services. Nonparticipating providers and facilities may not accept this amount as payment in full for covered services.

Explanation of Benefits (EOB)

A statement provided to the insured by an insurance company explaining how the claim was processed.


The person responsible for paying the bill.

Out-of-Pocket Maximum

The total amount of eligible charges each year payable by insured directly to providers or facilities; 100 percent of eligible charges will be paid during the remainder of the year once the applicable out of pocket maximum is satisfied.


A third-party entity (commercial or government insurance carriers) that pays medical claims.

Primary Insurance

The insurance primarily responsible for the payment of the claim.

Prior Authorization/Precertification

A formal approval obtained from the insurance company prior to delivery of medical services.

Secondary Insurance

The insurance responsible for processing the claim after the primary insurance determination of benefits.


The person who holds and/or is responsible for the medical insurance policy

Supplemental Insurance

An additional insurance policy that processes claims after Medicare reimbursement.