Every health insurance term you'll hear, defined like a friend would explain it. Hover the highlighted terms throughout the guide to see the short version; the long version lives here.
A request your provider sends to your insurer asking to be paid for your care.
A claim is the paperwork your doctor's office submits to your insurance after a visit. The insurer reviews it, applies your benefits, and decides what they'll pay. You usually don't have to file claims yourself if you stayed in-network.
Your share of a bill after you've met your deductible — usually a percentage.
After you hit your deductible, you and your insurer split the cost of care. Coinsurance is your percentage. A 20% coinsurance means you pay 20% of the bill and your plan pays 80%, until you reach your out-of-pocket maximum.
A small fixed fee you pay at the time of a visit or prescription.
A copay (or copayment) is a flat dollar amount you pay for a specific service — $25 for a primary care visit, $50 for a specialist, $10 for a generic prescription. Copays are predictable and usually don't depend on your deductible.
What you pay out of pocket before insurance starts covering most costs.
A deductible is the amount you have to pay yourself each year before your insurance company starts picking up most of the bill. If your deductible is $2,000, you pay the first $2,000 of covered care; after that, your plan kicks in. Preventive care (annual checkup, vaccines) is usually free even before you hit it.
A statement from your insurer showing what they paid and what you owe.
Explanation of Benefits. After you get care, your insurer sends an EOB that shows the billed amount, what they covered, the negotiated rate, and what (if anything) you owe. It is NOT a bill — it's a summary. Always read it before paying the real bill.
Like an HMO without referrals — in-network only, but more freedom inside it.
Exclusive Provider Organization. EPOs require you to stay in-network like an HMO, but you don't need referrals to see specialists. Often a sweet spot if you don't mind the network limits.
Your plan's list of covered prescription drugs, grouped by cost tier.
A formulary is the menu of medications your insurance will help pay for. Drugs are usually grouped into tiers — generic (cheapest), preferred brand, non-preferred brand, and specialty. If a drug isn't on the formulary, you typically pay full price.
A high-deductible plan paired with a tax-free Health Savings Account.
High Deductible Health Plan. Lower monthly premiums but you pay more before coverage kicks in. The trade-off is you can open an HSA — a tax-advantaged savings account for medical expenses. Great for healthy people who want to save on premiums.
A plan that keeps costs low by requiring you to stay in-network.
Health Maintenance Organization. HMOs have lower premiums and lower out-of-pocket costs, but you must use in-network providers (except in emergencies) and typically need a referral from your primary care doctor to see a specialist.
A tax-free savings account for medical expenses, paired with an HDHP.
Health Savings Account. You contribute pre-tax money (up to ~$4,150/year for 2025 if single), it grows tax-free, and you can withdraw it tax-free for medical expenses. Unused money rolls over forever — it's the closest thing health insurance has to a 401(k).
ACA plans are grouped Bronze, Silver, Gold, Platinum by how costs are split.
On the ACA marketplace, plans are labeled by metal tier. Bronze: low premium, high out-of-pocket. Silver: balanced (and the only tier eligible for cost-sharing reductions). Gold: higher premium, lower out-of-pocket. Platinum: highest premium, lowest out-of-pocket. The metal tier doesn't reflect quality of care — only how you split costs.
The group of doctors and hospitals that have a contract with your plan.
Your network is the list of doctors, specialists, hospitals, and pharmacies your insurance has negotiated rates with. Staying in-network keeps your costs down. Going out-of-network can mean paying much more — or sometimes the full bill yourself.
The annual window when anyone can enroll in or change a marketplace plan.
For most states, open enrollment runs roughly November 1 through January 15. Outside that window, you can only enroll if you have a Special Enrollment Period (like turning 26, losing job-based coverage, moving, or having a baby).
The most you'll ever pay in a year. After this, your plan covers 100%.
The out-of-pocket maximum is the cap on what you can spend on covered care in a calendar year (deductible + copays + coinsurance combined). Once you hit it, your plan pays 100% of covered services for the rest of the year. This is the number that protects you in a worst-case medical year.
A flexible plan that lets you see any doctor, in or out of network.
Preferred Provider Organization. PPOs cost more in premiums but let you see specialists without a referral and use out-of-network providers (at a higher cost). Best if you want flexibility or already have doctors you like.
Annual checkups, screenings, and vaccines — covered 100% by ACA plans.
Under the ACA, every plan must cover a list of preventive services — annual physicals, vaccines, cancer screenings, birth control, mental health screenings — at no cost to you, even before you've met your deductible. Use them.
Your main doctor — the first stop for non-emergencies and referrals.
Your PCP (primary care provider) handles your routine care, manages chronic conditions, and refers you to specialists. On HMO plans you must pick one; on PPO/EPO plans it's optional but highly recommended.
A 60-day window after a life event when you can sign up outside open enrollment.
Qualifying life events — turning 26, losing other coverage, getting married, having a baby, moving — give you 60 days to enroll or change plans outside the annual window. Don't miss it; after 60 days you usually have to wait for the next open enrollment.
A government discount on your premium based on your income.
If your income is between roughly 100% and 400% of the federal poverty level (and through 2025, even higher), the ACA gives you a premium tax credit that lowers your monthly cost. Most people who buy on the marketplace qualify for some help — don't skip applying.
