From Michelle's desk in Summerville
Fifty of the terms that trip people up the most — defined in plain English, with real South Carolina context and zero fine print. Written for the phone calls I take every week, not for the back of a brochure.
Tap any underlined cross-reference to jump between related terms — they are all connected the way they come up in real conversations.
The federal law, also called Obamacare, that created the Health Insurance Marketplace and requires most plans to cover essential health benefits. In South Carolina, ACA marketplace plans are available through healthcare.gov with carriers like Blue Cross Blue Shield and Ambetter. The ACA also prevents insurers from denying coverage or charging more because of pre-existing conditions. See also: Marketplace, Essential Health Benefits.
The yearly window — October 15 through December 7 — when Medicare beneficiaries can join, switch, or drop Medicare Advantage and Part D prescription drug plans. Changes made during AEP take effect January 1 of the following year. This is separate from the ACA Open Enrollment period. See also: Medicare Advantage, Medicare Part D.
A formal request asking your insurance company to reconsider a decision to deny coverage or payment for a service. You have the right to appeal any denial, and the insurer must review it within specific timeframes — typically 30 days for standard appeals, 72 hours for urgent care situations. If the internal appeal fails, you can request an independent external review at no cost. See also: Claim, Grievance.
The Children's Health Insurance Program provides low-cost health coverage for children in families that earn too much to qualify for Medicaid but can't afford private insurance. In South Carolina, CHIP is run through Healthy Connections and covers children up to age 19 in families earning up to about 213% of the federal poverty level. Coverage includes doctor visits, prescriptions, dental, vision, and hospital care with little to no cost. See also: Medicaid.
A request submitted to your insurance company to pay for a medical service you received. In most cases, your doctor's office submits the claim directly. The insurer then processes it according to your plan benefits and sends you an Explanation of Benefits showing what was covered, what the insurer paid, and what you owe. If a claim is denied, you have the right to appeal. See also: Explanation of Benefits (EOB), Appeal.
The Consolidated Omnibus Budget Reconciliation Act lets you keep your employer's group health insurance for up to 18 months after you leave a job, get laid off, or lose coverage due to reduced hours. The catch: you pay the full premium yourself, including the portion your employer used to cover, plus a 2% administrative fee — which often means $600 to $1,800 per month or more. In many cases, a marketplace plan with subsidies costs significantly less. See also: Marketplace, Subsidy (Premium Tax Credit).
The percentage of a medical bill you pay after you've met your deductible. For example, if your plan has 20% coinsurance, you pay 20% of the allowed amount and the insurer pays 80%. Coinsurance applies until you reach your out-of-pocket maximum, at which point the insurer covers 100%. Plans with lower coinsurance usually have higher monthly premiums. See also: Deductible, Out-of-Pocket Maximum.
A fixed dollar amount you pay for a covered service at the time you receive it — for example, $30 for a primary care visit or $50 for a specialist. Copays are separate from your deductible and usually apply to doctor visits, urgent care, and prescriptions. The amount varies by plan and service type, and copays count toward your out-of-pocket maximum. See also: Deductible, Out-of-Pocket Maximum.
Extra savings available on Silver-tier marketplace plans that lower your deductible, copays, and out-of-pocket maximum. You qualify if your household income is between 100% and 250% of the federal poverty level. Unlike premium subsidies that reduce your monthly bill, cost-sharing reductions make your plan work better when you actually use it. You must enroll in a Silver plan to get these benefits — they don't apply to Bronze or Gold plans. See also: Subsidy (Premium Tax Credit).
A phase of Medicare Part D prescription drug coverage where you temporarily pay a higher share of drug costs. In 2025, the Inflation Reduction Act caps out-of-pocket drug spending at $2,000 per year for Medicare Part D enrollees, effectively closing the donut hole. Before reaching that cap, you may still pay more for certain medications once your total drug costs hit a certain threshold. See also: Medicare Part D, Extra Help (LIS).
Health insurance coverage that is considered at least as good as a specific standard — most often used in the context of Medicare Part D. If your current employer or retiree drug plan provides creditable coverage, you can delay enrolling in Part D without facing a late enrollment penalty later. Your plan is required to notify you each year whether your drug coverage is creditable. See also: Late Enrollment Penalty, Medicare Part D.
The amount you pay out of your own pocket for covered medical services before your insurance starts paying its share. For example, if your deductible is $3,000, you pay the first $3,000 of covered services yourself. After that, your plan typically kicks in with coinsurance or copays. Most plans cover preventive care — like annual physicals and screenings — at no cost, even before you meet your deductible. See also: Coinsurance, Preventive Care.
A person who qualifies for both Medicare and Medicaid. In South Carolina, dual eligible individuals may receive help with Medicare premiums, deductibles, and copays through Medicaid. They may also qualify for Special Needs Plans (SNPs), which are Medicare Advantage plans specifically designed to coordinate benefits across both programs. About 12 million Americans are dual eligible. See also: Medicare, Medicaid.
An Exclusive Provider Organization plan that covers services only from doctors and hospitals in its network — with no coverage for out-of-network care except in emergencies. EPOs don't require referrals to see specialists, which makes them more flexible than HMOs in that respect. They often have lower premiums than PPOs because of the tighter network. If you use a doctor outside the network, you pay the full cost. See also: HMO, PPO, Network.
Ten categories of services that all ACA-compliant health plans must cover: hospitalization, emergency services, maternity and newborn care, mental health and substance use treatment, prescription drugs, rehabilitative services, lab work, preventive care, pediatric services (including dental and vision), and outpatient care. Short-term health plans and some grandfathered plans are not required to cover all of these. See also: ACA (Affordable Care Act).
A statement your insurance company sends after processing a claim. It shows the service provided, what the provider charged, what the insurer's negotiated rate was, how much the insurer paid, and what you owe. An EOB is not a bill — it's a summary. Always compare your EOB to any bill you receive from the provider to make sure the numbers match. See also: Claim.
A Medicare program — also called the Low-Income Subsidy — that helps people with limited income and resources pay for Part D prescription drug premiums, deductibles, and copays. If you qualify, Extra Help can save you an average of $5,000 or more per year on drug costs. In South Carolina, you can apply through Social Security or your local Department of Social Services. See also: Medicare Part D, Coverage Gap (Donut Hole).
The list of prescription drugs covered by your health insurance or Medicare Part D plan. Formularies are organized into tiers — generic drugs are usually the cheapest tier, preferred brand-name drugs are mid-range, and specialty drugs are the most expensive. If your medication isn't on the formulary, you may have to pay full price or request a formulary exception. Always check the formulary before choosing a plan. See also: Prior Authorization.
A formal complaint you file with your insurance company about anything other than a claim denial — such as poor customer service, difficulty reaching your plan, or problems with the quality of care. Unlike an appeal, a grievance doesn't ask the insurer to reverse a specific coverage decision. Your plan must acknowledge your grievance promptly and resolve it within 30 days. See also: Appeal.
A rule that requires an insurer to sell you a policy regardless of your health status, age, or pre-existing conditions. Under the ACA, all marketplace plans are guaranteed issue during Open Enrollment and Special Enrollment Periods. For Medicare Supplement (Medigap) policies, South Carolina follows federal guidelines — you have a guaranteed issue right during your 6-month Medigap open enrollment period starting when you turn 65 and enroll in Part B. See also: Open Enrollment, Medigap.
A Health Maintenance Organization plan that typically requires you to choose a primary care physician (PCP) and get referrals before seeing specialists. HMOs generally only cover in-network care except in emergencies. The trade-off: HMOs often have lower premiums and out-of-pocket costs than PPOs. In South Carolina, carriers like Ambetter and some Blue Cross Blue Shield plans use HMO networks. See also: PPO, Network.
An Individual Coverage Health Reimbursement Arrangement lets employers of any size reimburse employees tax-free for individual health insurance premiums and medical expenses instead of offering a traditional group plan. There's no cap on how much the employer can contribute. Employees buy their own plan on the marketplace or elsewhere and get reimbursed. If you have an ICHRA, you generally can't also receive marketplace premium subsidies. See also: QSEHRA, Marketplace.
Doctors, hospitals, and other providers that have contracted with your insurance company to provide services at negotiated, discounted rates. Using in-network providers almost always costs you significantly less than going out-of-network. Before scheduling any procedure or appointment, verify the provider is still in your plan's current network — networks can change mid-year. See also: Network, Out-of-Network.
The 7-month window when you first become eligible for Medicare — it starts 3 months before the month you turn 65, includes your birthday month, and extends 3 months after. If you miss this window, you may face late enrollment penalties and coverage gaps. During your IEP, you can sign up for Medicare Parts A and B, choose a Medicare Advantage plan, or enroll in a Part D drug plan. See also: Medicare, Late Enrollment Penalty.
A permanent surcharge added to your monthly premium if you don't sign up for Medicare Part B or Part D when you're first eligible and don't have qualifying coverage. The Part B penalty is 10% of the standard premium for each full 12-month period you were eligible but didn't enroll. The Part D penalty is roughly 1% of the national base premium per uncovered month. These penalties last for as long as you have the coverage. See also: Initial Enrollment Period (IEP), Creditable Coverage.
A type of employer health plan that combines elements of fully insured and self-funded plans. The employer pays a fixed monthly amount that includes claims funding, stop-loss insurance, and administrative costs. If actual claims come in lower than projected, the employer may receive a refund. Level-funded plans are popular with small businesses in South Carolina because they offer predictable costs with potential savings. See also: Self-Funded Plan.
The Health Insurance Marketplace — also called the Exchange — is where individuals and families shop for and enroll in ACA-compliant health insurance plans. South Carolina uses the federal marketplace at healthcare.gov. Plans are organized into metal tiers (Bronze, Silver, Gold, Platinum) based on how costs are shared. You can apply for premium subsidies and cost-sharing reductions when you enroll. See also: ACA (Affordable Care Act), Subsidy (Premium Tax Credit).
A joint federal and state program that provides free or low-cost health coverage to people with very low income. As of 2025, South Carolina has not expanded Medicaid under the ACA, so eligibility is limited — primarily covering pregnant women, children, people with disabilities, and some elderly adults. Income limits are strict: most non-disabled adults without children do not qualify. See also: CHIP, Dual Eligible.
Federal health insurance for people 65 and older, and for some younger people with disabilities or end-stage renal disease. Medicare has four parts: Part A (hospital insurance, usually premium-free), Part B (medical insurance, with a standard 2025 premium of $185 per month), Part C (Medicare Advantage), and Part D (prescription drug coverage). Original Medicare does not cover everything — many people add supplemental coverage. See also: Medicare Advantage, Medigap, Medicare Part D.
Medicare Part C — a private insurance alternative to Original Medicare offered by companies like Humana, UnitedHealthcare, and Blue Cross Blue Shield. These plans must cover everything Original Medicare covers and often include extras like dental, vision, hearing, and sometimes gym memberships. Most Medicare Advantage plans use HMO or PPO networks, so your choice of doctors may be more limited. Many plans in South Carolina have $0 premiums beyond your Part B premium. See also: Medicare, HMO, PPO.
The part of Medicare that covers prescription drug costs, offered through private insurance companies as either a standalone drug plan (PDP) or as part of a Medicare Advantage plan. Each plan has its own formulary and pricing tiers. Starting in 2025, total out-of-pocket drug costs are capped at $2,000 per year under the Inflation Reduction Act. Choosing the right Part D plan requires checking that your specific medications are covered at a reasonable cost. See also: Formulary, Coverage Gap (Donut Hole).
Medicare Supplement Insurance sold by private insurers to help cover costs that Original Medicare doesn't pay — like deductibles, coinsurance, and copayments. Medigap plans are standardized by letter (Plan A, Plan G, Plan N, etc.), so the benefits are the same regardless of which company sells them; only the price varies. In South Carolina, the best time to buy Medigap is during your 6-month open enrollment period starting when you're 65 and enrolled in Part B — no health questions asked. See also: Medicare, Guaranteed Issue.
The group of doctors, hospitals, pharmacies, and other healthcare providers that have agreements with your insurance company to provide services at negotiated rates. Your plan type — HMO, PPO, EPO, or POS — determines how much flexibility you have to use providers outside the network. In the South Carolina Lowcountry, the size and makeup of networks varies significantly between carriers. See also: In-Network, Out-of-Network.
The annual period when you can sign up for or change your health insurance. For ACA marketplace plans, Open Enrollment typically runs from November 1 through January 15. For Medicare, the Annual Enrollment Period is October 15 through December 7. Outside these windows, you generally can't enroll unless you have a qualifying life event. See also: Special Enrollment Period, Qualifying Life Event, Annual Enrollment Period (AEP).
Providers who do not have a contract with your insurance company. Visiting an out-of-network provider usually costs you significantly more — and with HMO or EPO plans, out-of-network care may not be covered at all except in emergencies. Even with PPO plans that offer out-of-network benefits, you'll pay higher deductibles and coinsurance. Always verify network status before scheduling care. See also: In-Network, Network.
The most you have to pay for covered services in a plan year. Once you hit this amount — through deductibles, copays, and coinsurance combined — your insurance pays 100% of covered services for the rest of the year. For 2025 ACA plans, the out-of-pocket maximum can't exceed $9,200 for an individual or $18,400 for a family. This is your financial safety net in a worst-case medical year. See also: Deductible, Coinsurance.
A Point of Service plan combines features of HMOs and PPOs. You typically need a primary care physician and referrals for specialists (like an HMO), but you can also see out-of-network providers at a higher cost (like a PPO). POS plans are less common than HMOs and PPOs but can be a good middle ground if you want some out-of-network flexibility without full PPO premiums. See also: HMO, PPO.
A Preferred Provider Organization plan gives you the most flexibility in choosing doctors and hospitals. You can see any provider without a referral, though you'll pay less if you stay in-network. PPOs typically have higher premiums than HMOs or EPOs, but they're a good fit if you want the freedom to see out-of-network specialists or if you travel frequently. In South Carolina, BCBS and Cigna offer popular PPO options. See also: HMO, EPO, Network.
A health condition — such as diabetes, cancer, asthma, or depression — that you had before your new coverage started. Under the ACA, health insurance companies cannot deny you coverage or charge you more because of a pre-existing condition on marketplace, employer, or Medicaid plans. However, short-term health insurance plans and some non-ACA-compliant plans can still exclude or limit coverage for pre-existing conditions. See also: ACA (Affordable Care Act), Guaranteed Issue.
The amount you pay each month to keep your health insurance active, regardless of whether you use any medical services. Think of it like a membership fee. Premiums vary widely based on your plan type, age, location, and tobacco use. In South Carolina, a 40-year-old might pay anywhere from $300 to $800 per month before subsidies. Many people qualify for premium tax credits that significantly reduce this cost. See also: Subsidy (Premium Tax Credit).
Health services designed to prevent illness or detect it early — including annual checkups, vaccinations, cancer screenings (like mammograms and colonoscopies), blood pressure checks, and cholesterol tests. Under the ACA, all marketplace and most employer plans must cover recommended preventive services at no cost to you, even before you meet your deductible. The specific services covered depend on your age and gender. See also: Essential Health Benefits.
A requirement that your doctor get approval from your insurance company before performing certain procedures, prescribing specific medications, or referring you to a specialist. The insurer reviews whether the service is medically necessary. Prior authorization can take days or weeks, which is why it's important to start the process early. If you receive care without required authorization, the insurer may refuse to pay. See also: Formulary, Appeal.
A Qualified Small Employer Health Reimbursement Arrangement is available to businesses with fewer than 50 employees that don't offer a group health plan. The employer sets a monthly allowance — up to $6,150 per individual or $12,450 per family in 2025 — and employees get reimbursed tax-free for individual health insurance premiums and qualified medical expenses. Unlike ICHRA, QSEHRA has annual contribution limits. See also: ICHRA.
A major life change that allows you to enroll in or change your health insurance outside of Open Enrollment. Examples include losing existing coverage, getting married or divorced, having a baby, moving to a new area, or losing Medicaid eligibility. In most cases, you have 60 days from the event to enroll in a new plan. Documentation is typically required to verify the event. See also: Special Enrollment Period, Open Enrollment.
A health plan where the employer pays for employee medical claims directly out of company funds rather than purchasing insurance from a carrier. The employer assumes the financial risk, though most buy stop-loss insurance to protect against catastrophic claims. Self-funded plans are regulated by federal ERISA law, not state insurance regulations, which gives employers more flexibility in plan design. See also: Level-Funded Plan.
The Small Business Health Options Program marketplace where employers with 1 to 50 employees can shop for group health insurance plans. SHOP plans are ACA-compliant and businesses may qualify for the Small Business Health Care Tax Credit if they have fewer than 25 full-time employees with average wages below $56,000. In South Carolina, SHOP plans are available through healthcare.gov alongside individual marketplace plans. See also: Marketplace.
Temporary health coverage designed to fill gaps between other insurance — for example, between jobs or while waiting for employer coverage to start. In South Carolina, short-term plans can last up to 364 days. These plans are generally cheaper than ACA plans but come with major limitations: they can deny coverage for pre-existing conditions, don't have to cover essential health benefits, and don't count as minimum essential coverage. See also: Essential Health Benefits, Pre-existing Condition.
A window of time — usually 60 days — outside of Open Enrollment when you can sign up for health insurance because of a qualifying life event like losing coverage, getting married, having a baby, or moving. You need to act quickly because the window is strict. In South Carolina, Special Enrollment applies to both marketplace plans and Medicare (under certain circumstances). See also: Qualifying Life Event, Open Enrollment.
A federal tax credit that lowers your monthly health insurance premium on marketplace plans. You may qualify if your household income is between 100% and 150% of the federal poverty level (and above, under current extended rules). For 2025, many South Carolina families qualify for subsidies that reduce premiums to under $100 per month or even $0. The credit can be applied in advance to lower your monthly payment or claimed when you file taxes. See also: Marketplace, Cost-Sharing Reduction.
The process insurers use to evaluate your risk and determine your eligibility, coverage terms, and pricing. For ACA marketplace plans, medical underwriting is prohibited — everyone pays the same rate regardless of health. However, underwriting still applies to life insurance, Medigap policies (outside of guaranteed issue periods), and short-term health plans. During underwriting, insurers may review your medical history, medications, and lifestyle. See also: Guaranteed Issue, Medigap.
Still confused?
Insurance shouldn't require a dictionary. If a term on this page — or anywhere else — isn't clicking, the fastest path to a real answer is to pick up the phone. No sales script, no pressure, just a licensed Lowcountry agent walking you through it in plain English.
Call Michelle at (843) 594-1759