Glossary


Association group plans

Insurance plans designed for members of a professional association or trade association. Members may be protected under a group policy or by individual franchise policies

Beneficiary

The person who is to receive the drug benefits.

Benefit

The drugs for which the insurance plan will reimburse costs.

Blue Cross

An independent non-profit membership corporation providing protection against insurable health care costs.

Cap

The maximum amount the insurer will pay for medications for a specified certain period. Plans may have a yearly cap or a lifetime cap.

Claim

A demand to the insurer by the insured person for the payment of drug costs under a policy.

Coinsurance

A provision in a health insurance contract by which the insurer and insured share, in a specific ratio, the covered expenses under a policy. For example, the insurer may reimburse the insured for 80 per cent of covered expenses, the insured paying the remaining 20 per cent of such expenses.

Coordination of Benefits

A process through which individuals/families with access to more than one insurance plan and/or drug benefit program sequentially submit their claims to their insurers. The portion of the drug cost not paid for by the first insurer is claimed through the second insurer. See the Coordination of Benefits button on the sidebar.

Co-payment / Copay

The portion of the drug cost the insured has to pay. It may be a percentage of the total or a fixed dollar amount per prescription.

Covered expenses

Specified hospital, medical and miscellaneous health care expenses that will be considered under a health insurance policy.

Deductible

The amount of covered expenses that must be incurred and paid by the insured before drug benefits become payable by the insurer.

DIN Drug Identification Number

A unique identification number given to a medication upon its approval by Health Canada for sale in Canada.

Extended Health Care Insurance

A form of health insurance that provides, in one policy, protection for hospital and medical expenses not covered by government programs and usually other health care expenses, such as prescribed drugs, medical appliances, ambulance, private duty nursing, etc. The policy may contain a deductible amount, coinsurance and cap maximum benefits. Also called major medical expense insurance.

Formulary

A listing of all medications/products that a particular drug plan provides as benefits to its beneficiaries.

Group insurance

Insurance issued on a group of people under a master contract. It is usually issued to an employer for the benefit of employees. The individual members of the group hold certificates as evidence of their insurance.

Individual insurance

Insurance purchased on an individual basis, covering only one person or, in some cases, members of his or her family as well.

Inpatient

A patient who is hospitalized (staying in the hospital).

Insured

The individual who receives the benefits from the insurer.

Insurer

The party to the insurance contract who promises to pay for benefits. Also, any corporation licensed to furnish insurance to the public.

Open Access Plan

Plans which cover all prescription drugs unless specifically excluded or restricted (as opposed to managed formulary plans which exclude any drug that is not specifically listed).

Outpatient

A patient who is not hospitalized (not staying in the hospital) but visits the hospital for treatment or to see their physician.

Outpatient Medication

A medication that is not taken in the hospital and usually not paid for by the hospital.

Premium

The payment, or one of the periodic payments a policyholder is required to make for an insurance policy.

Private insurance / Third party insurance

Insurance, including prescription drug benefits, that is usually purchased by an employer, from one of the insurance companies, for their employees. See the Private Insurance button on the sidebar.

Reimbursement

Repayment to a beneficiary of the costs or portion of costs incurred to purchase medications listed as a benefit by the insurer.

Special authorization

A process where a drug plan or drug benefit program makes a prescriber request coverage for a specific drug (request can be a letter or form detailing the patient's condition, providing specific clinical information and reasons why the medication is necessary) before approval can be granted for reimbursement of the cost of the medication. In some cases there are specific criteria associated with the use of a drug that must be met before approval is granted.