Medical Billing & Coding Glossary

Outstanding money owed to a healthcare organization by payers or patients; A/R teams track, follow up, and resolve those balances.

The payer’s review of a claim to decide what is payable, denied, reduced, or assigned to patient responsibility.

A report that groups unpaid payer and patient balances by how long they have been outstanding, commonly 0–30, 31–60, 61–90, 91–120, and more than 120 days.

The American Medical Association, the organization that owns and maintains the CPT code set.

Supportive diagnostic or therapeutic services provided in addition to a primary service, such as laboratory testing, imaging, therapy, or pharmacy services.

A formal request asking a payer to reconsider an adverse claim or coverage decision, supported by the payer’s required form, documentation, and filing deadline.

The allowed amount a payer assigns to the patient’s deductible instead of paying on the claim.

Application Service Provider, an older term for a vendor that hosts software for customers over a network; modern medical-billing platforms more commonly use the term SaaS or cloud software.

A patient’s authorization allowing a health plan to send eligible benefit payments directly to the treating provider.

A payer’s approval requirement for specified services, drugs, or equipment. Approval does not by itself guarantee payment because eligibility and claim rules still apply.

A person entitled to benefits under an insurance policy or government healthcare program.

The Blue Cross Blue Shield system is a national federation of independent, locally operated health-plan companies that license the Blue Cross and Blue Shield brands.

A fixed payment made to a provider or organization for each enrolled patient over a defined period, usually regardless of how many covered services the patient uses.

CHAMPUS was the former name of the U.S. military’s civilian health-benefit program; current claims and coverage use TRICARE program names and rules.

Healthcare provided free or at a reduced charge under an organization’s financial-assistance policy for patients who meet its eligibility criteria.

A claim is a request for payment sent to a payer; an encounter is the documented patient-service event from which charges and codes are produced.

A complete, accurate claim that meets the payer’s submission requirements and can be processed without requesting additional information.

An electronic intermediary that validates, formats, and routes healthcare transactions between providers and payers.

The identifier associated with a laboratory’s certification under the Clinical Laboratory Improvement Amendments; laboratories must use the appropriate certification for the tests they perform.

The Centers for Medicare & Medicaid Services, the federal agency that administers Medicare and works with states to administer Medicaid and other health programs.

The standard paper claim form used by non-institutional providers and suppliers to report professional services; electronic professional claims generally use the HIPAA 837P transaction.

Federal continuation coverage that may let eligible employees and family members temporarily keep employer-sponsored group health coverage after certain qualifying events, usually by paying the full premium plus an allowed administrative fee.

The process of translating documented diagnoses, services, procedures, supplies, and circumstances into standardized code sets used for claims, reporting, and analysis.

The percentage of an allowed amount that a patient owes for a covered service after applicable deductible requirements are met.

A revenue-cycle measure comparing payments collected with the amount available or expected to be collected; the exact formula must specify whether it is gross or net collection rate.

The portion of a provider’s charge removed because the payer contract limits reimbursement to an agreed allowed amount; it generally is not billable to the patient.

The process used when a patient has more than one health plan to determine the order in which the plans pay and prevent duplicate payment.

A fixed amount a patient owes for a covered service under the terms of the health plan.

A five-character Current Procedural Terminology code maintained by the AMA to report medical services and procedures. Diagnosis support is evaluated separately and is not a one-to-one code match.

The process of verifying a clinician’s identity, education, training, licenses, sanctions, and other qualifications before granting participation or privileges.

A negative account balance indicating that payments or adjustments may exceed valid charges; it must be reviewed to determine whether a payer or patient refund, offset, or correction is required.

A Medicare claim whose adjudicated information is automatically forwarded to an eligible supplemental payer, such as Medicaid or a Medigap insurer.

The date on which a healthcare service, item, or procedure was provided.

A daily practice-management report summarizing activity such as visits, charges, payments, and adjustments.

A registration identifier issued by the U.S. Drug Enforcement Administration to authorized practitioners or organizations that handle controlled substances.

The amount a member must pay for covered services during a benefit period before the plan begins paying services subject to that deductible.

A summary of the patient’s identity, contact, guarantor, and insurance information used for registration and billing.

A payer decision not to pay all or part of a claim or service line, accompanied by adjustment and remark information explaining the reason.

Durable medical equipment: reusable medical equipment intended for repeated use, such as certain wheelchairs, walkers, oxygen equipment, and glucose monitors, subject to payer coverage rules.

Date of birth.

Changing a submitted code to a lower-level code based on documentation, coding edits, or payer policy. Any change should be supported, transparent, and appealable when appropriate.

A coordination-of-benefits inquiry used to determine whether a member has other health coverage. Terminology and transaction methods vary by payer.

Common abbreviation for diagnosis; on claims, diagnoses are reported with the applicable ICD-10-CM code and required specificity.

Evaluation and Management services reported with CPT codes for visits and related professional work; code selection follows the current CPT guidelines for the service category.

A claim transmitted electronically in the payer’s required standard format, typically the HIPAA 837P, 837I, or 837D transaction.

The electronic transfer of healthcare payments into a designated bank account, commonly paired with an electronic remittance advice for reconciliation.

Checking a patient’s active coverage, benefits, network status, and relevant cost-sharing or authorization requirements for the planned date of service.

An electronic medical record is the digital clinical record used within a particular organization; an electronic health record is designed for broader longitudinal and interoperable use.

A person enrolled in a health plan or healthcare program.

An Explanation of Benefits is the member-facing claim summary; an Electronic Remittance Advice is the provider-facing electronic payment and adjustment transaction, usually the HIPAA 835.

The Employee Retirement Income Security Act of 1974, a federal law that sets standards for many employer-sponsored benefit plans, including disclosure, fiduciary, claims, and appeal requirements.

A payment model in which separate covered services are reimbursed individually according to the payer’s contract and payment rules.

A list of payment amounts or allowed amounts associated with specified services or codes. Payer fee schedules and a provider’s charge master are not the same thing.

The amount validly assigned to a payer, patient, guarantor, or other party after coverage, contract, and payment rules are applied.

Fiscal intermediaries historically processed Medicare Part A claims; Medicare Administrative Contractors now perform most Medicare fee-for-service claims administration.

A health plan’s covered-drug list, organized by coverage rules and cost-sharing tiers and subject to updates and utilization-management requirements.

An intentional deception or misrepresentation made with knowledge that it could result in an unauthorized healthcare benefit or payment.

Group Health Plan, a health-benefit arrangement offered through an employer, employee organization, or other eligible group.

The employer, association, or plan name associated with a member’s group health coverage.

The identifier a payer assigns to an employer or other group contract; it is different from the member or subscriber ID.

The person or entity financially responsible for the patient’s account; the guarantor may or may not be the patient or insurance subscriber.

The Health Care Financing Administration was renamed the Centers for Medicare & Medicaid Services in 2001; use CMS for the current agency.

The Healthcare Common Procedure Coding System. Level I is CPT; Level II is the national alphanumeric code set maintained by CMS for products, supplies, and services not included in CPT.

A broad informal label often used for the Affordable Care Act, enacted in 2010. Use the law’s actual name and current federal or state guidance rather than the vague phrase health care reform act.

Coverage that pays or reimburses eligible healthcare expenses according to a plan’s benefits, network, medical-necessity, cost-sharing, and exclusion rules.

The Social Security number-based Health Insurance Claim Number was removed from Medicare cards and replaced by the Medicare Beneficiary Identifier for most Medicare transactions.

The Health Insurance Portability and Accountability Act and its implementing rules, which establish U.S. standards for healthcare transactions and protections for identifiable health information.

Health Maintenance Organization, a managed-care plan type that generally uses a defined provider network and may require primary-care coordination or referrals, subject to the plan’s rules.

Interdisciplinary care focused on comfort and quality of life for a terminally ill person who meets the applicable program and payer eligibility requirements.

The International Classification of Diseases, the World Health Organization’s system for classifying diseases and related health conditions; U.S. claims use designated clinical and procedure modifications.

A code from the tenth revision of the International Classification of Diseases. U.S. diagnosis reporting uses ICD-10-CM, while inpatient hospital procedures use ICD-10-PCS.

A provider that has a current contract with a health plan to furnish covered services under negotiated payment and participation terms.

A separately identified charge for nursing resources above routine room-and-board services, when permitted by the facility’s charging methodology and payer rules.

A traditional health-insurance arrangement that reimburses covered services under policy terms and generally offers broader provider choice than closed-network managed-care plans.

A patient formally admitted to a hospital under an inpatient order; length of stay alone does not determine inpatient status.

Hospital care delivered in a specialized unit for patients who require close monitoring and advanced life-support or treatment resources.

Independent Practice Association, an organization through which independent clinicians may contract collectively for managed-care participation and related administrative services.

HCPCS Level I, the AMA’s CPT code set used to report professional services and procedures.

HCPCS Level II, the national alphanumeric code set maintained by CMS for products, supplies, drugs, ambulance services, and other items not represented in CPT.

HCPCS Level III local codes were eliminated for standard healthcare transactions after 2003; current claims use the applicable national code sets and payer instructions.

Medicare Administrative Contractor, a private organization contracted by CMS to administer specified Medicare fee-for-service claims and provider functions in a jurisdiction.

A health plan that manages cost and access through tools such as provider networks, contracted rates, referrals, prior authorization, and utilization review.

A joint federal-state program that provides health coverage to eligible people; benefits, eligibility, and billing requirements vary by state and program.

A healthcare professional who performs delegated administrative and clinical support duties within their training, state law, and employer policies.

A revenue-cycle professional who prepares and submits claims, posts payments, resolves denials, follows up balances, and communicates with payers and patients.

A professional who reviews health-record documentation and assigns applicable diagnosis, procedure, supply, and modifier codes under current coding guidelines.

A payer-specific determination that a service is reasonable and necessary or otherwise meets the plan’s coverage criteria for the patient’s condition.

An identifier assigned by a healthcare organization to link a patient with records in that organization’s system; it is not a national patient identifier.

An ambiguous term that may refer to an Archer MSA or a Medicare Medical Savings Account plan. It should not be used interchangeably with an HSA or FSA, which have different eligibility and tax rules.

The conversion of a clinician’s dictated audio into structured clinical text, followed by appropriate review and integration into the health record.

The U.S. federal health-insurance program for people age 65 or older and certain younger people with disabilities or qualifying conditions.

Under Original Medicare inpatient hospital benefits, days 61–90 of a benefit period have a daily coinsurance amount; additional lifetime reserve days have separate rules and amounts.

The coverage-gap phase was eliminated from the standard Medicare Part D benefit in 2025; current benefits use deductible, initial-coverage, and catastrophic phases with an annual out-of-pocket threshold.

The part of Medicare that primarily covers eligible inpatient hospital, skilled nursing facility, hospice, and certain home-health services under program rules.

The part of Medicare that covers eligible physician, outpatient, preventive, diagnostic, therapy, and certain medical-equipment services under program rules.

Medicare prescription-drug coverage offered through approved private plans, with formularies, utilization rules, premiums, and cost sharing that vary by plan and year.

Private Medicare supplement insurance that helps pay specified cost-sharing gaps in Original Medicare; standardized plan availability and benefits depend on location and eligibility.

A two-character code appended to a procedure or service code to report a documented circumstance that affects how the service should be understood or processed.

Medicare Secondary Payer, the rules used to determine when another insurer or arrangement must pay before Medicare.

No charge or non-covered, depending on the payer or system context. Confirm the field definition before interpreting this abbreviation.

The FDA’s three-segment identifier for a marketed drug package. Claims may require an 11-digit billing format derived from the product’s assigned NDC.

Not elsewhere classified, indicating that the documented condition is specific but no more specific code category is available in the classification.

A provider contracted with a health plan or network for specified products, services, payment terms, and member cost sharing.

A participation status in which a provider has not agreed to accept a payer’s approved amount as payment in full for all covered services; exact rules vary by payer and program.

Not otherwise specified, an older abbreviation for an unspecified classification used when documentation does not support a more specific code.

National Provider Identifier, the standard 10-digit identifier used for covered healthcare providers in HIPAA administrative transactions.

The U.S. Department of Health and Human Services Office of Inspector General, which conducts oversight and enforcement work to protect HHS programs from fraud, waste, and abuse.

A provider without a contract for the patient’s specific health-plan network; coverage, cost sharing, balance-billing protections, and claim handling depend on the plan and law.

The annual limit on a member’s spending for covered in-network services that count toward the plan limit; premiums and some other expenses generally do not count.

Services provided without a formal inpatient admission, including many clinic, emergency, observation, ambulatory surgery, and hospital outpatient services.

Contracting an external organization to perform functions such as coding, billing, follow-up, technology support, or other revenue-cycle work.

A Medicare Administrative Contractor and other government-program contractor. Its jurisdictions and responsibilities should be confirmed through current CMS contractor information.

The valid amount a patient owes after payer adjudication and applicable contract, benefit, assistance, and legal requirements are applied.

An organization responsible for adjudicating and paying eligible healthcare claims, such as a commercial insurer, employer plan, or government program.

An identifier used to route electronic transactions to the correct payer or payer line of business; format and value depend on the clearinghouse and transaction.

Primary care provider, the clinician or practice that delivers and coordinates general care; the provider does not always have to be a physician.

Protected Health Information, individually identifiable health information protected by the HIPAA Privacy Rule when held or transmitted by a covered entity or business associate.

A two-digit code used on professional claims to identify the setting where a service was furnished.

A point-of-service health plan combines managed-care features with an option to use out-of-network care, generally at higher member cost and subject to plan rules.

Preferred Provider Organization, a plan type that uses a contracted network and may cover eligible out-of-network care at higher member cost, subject to plan terms.

Software used to manage administrative and revenue-cycle work such as registration, scheduling, charge entry, claims, payments, statements, and reporting.

A payer review required before certain services to determine whether stated coverage criteria are met; it is not a guarantee of payment.

A health condition that existed before new coverage began. Most ACA-compliant health plans cannot deny coverage or charge more because of it, but rules for other products may differ.

Primarily a historical individual and group health-plan concept. Most current ACA-compliant health coverage cannot deny enrollment or charge more because of a pre-existing condition, though other coverage types may follow different rules.

A payer requirement to obtain approval before a specified service, drug, or item. Authorization confirms review but does not guarantee payment if other claim requirements are not met.

A pre-service payer estimate or review of how a proposed service may be covered; it is generally not a payment guarantee.

The amount paid to keep an insurance policy or health-plan coverage active, typically billed monthly.

The HIPAA Privacy Rule establishes when covered entities and business associates may use or disclose protected health information and gives individuals specified rights over that information.

A person or organization that furnishes healthcare services, items, or supplies and may bill a payer or patient for them.

A Medicare enrollment identifier issued by a Medicare Administrative Contractor. It is used with Medicare enrollment records and does not replace the NPI on claims.

Older identifiers such as UPIN, PIN, OSCAR, or NSC may appear in historical records; current workflows use the required NPI, PTAN, CCN, or payer-specific identifier for the transaction.

A request or direction from one clinician for a patient to receive evaluation or treatment from another provider; some health plans require a valid referral for coverage.

Payment made for covered healthcare services after the payer applies contract terms, coding edits, coverage rules, and member cost sharing.

A provider-facing explanation of claim payment and adjustments. The electronic form is the HIPAA 835 ERA; it is different from the member-facing EOB.

The person or entity responsible for resolving the patient’s valid account balance, often called the guarantor.

A four-digit code used on institutional claims to identify the department, accommodation, or category associated with a charge.

The processes used to manage the financial life cycle of patient care, from scheduling and registration through coding, billing, payment, denial resolution, and account closure.

Relative Value Unit, a component of resource-based payment calculations that reflects physician work, practice expense, and malpractice expense; it is not itself a payment amount.

Automated and manual validation of claim data against formatting, coding, payer, and business rules before submission.

A claim sent to a second payer after the primary payer has adjudicated, using coordination-of-benefits information from the primary decision.

An additional procedure performed during the same encounter. Reporting and payment depend on documentation, bundling edits, code sequencing, and payer rules.

The HIPAA Security Rule requirements for administrative, physical, and technical safeguards protecting electronic protected health information.

An account or service for which the patient is responsible for payment without claim reimbursement from a health plan for that charge.

A patient’s decision to seek specialty care without a referral; coverage depends on the health plan, while physician self-referral has a separate legal meaning under the Stark Law.

A licensed facility that provides short- or long-term skilled nursing and rehabilitation services; payer coverage requires the applicable clinical and program criteria.

Signature on file, indicating that the organization retains the patient’s or authorized person’s signature supporting a required authorization or acknowledgment.

Software hosted by a vendor and accessed over a network, usually by subscription, with the vendor managing the application and infrastructure.

A clinician with advanced training or a focused scope of practice in a particular field; referral requirements depend on the patient’s health plan.

The identifier on a professional license issued by a state licensing authority; the issuing state and profession are part of the identifier’s meaning.

An identifier assigned to an organization or trading partner that sends electronic healthcare transactions; it is not automatically the same as the organization’s TIN.

The person who holds or is enrolled under the insurance contract; dependents receive coverage through the subscriber’s policy.

A charge-capture document listing documented diagnoses, services, procedures, and other encounter details for coding and claim preparation; it is not itself a claim.

Additional coverage designed to pay specified expenses not fully paid by primary insurance. Medicare supplement insurance is a specific regulated form of supplemental coverage.

Treatment Authorization Request, a term used by some Medicaid and other programs for prior authorization. Use the specific payer’s current process and identifier.

A taxpayer identifying number used for federal tax administration. For many business entities this is an Employer Identification Number; it is not interchangeable with an NPI.

A 10-character code from the healthcare provider taxonomy set that classifies a provider’s type, classification, and specialization for enrollment and transactions.

The date on which a member’s coverage, benefit, contract, or provider participation ends.

A claim sent to a third payer after the primary and secondary payers have adjudicated, following coordination-of-benefits rules.

An organization that performs administrative services such as claims processing or benefits administration for another entity, often a self-funded employer plan.

Taxpayer Identification Number. Depending on the entity, this may be an EIN, SSN, or another IRS-recognized taxpayer identifier.

Triple Option Plan historically described coverage offering multiple plan choices; confirm the meaning from the source document because TOP is not a universal current plan type.

Type of service is a broad service-category label found in some payer systems and older records; current claim reporting relies on the transaction’s specific codes and fields.

The U.S. Department of Defense healthcare program for eligible service members, retirees, and family members, with coverage and claims rules that vary by plan and beneficiary category.

The standard paper institutional claim form used by hospitals and other facilities; electronic institutional claims generally use the HIPAA 837I transaction.

Reporting separate component codes when coding rules require a single comprehensive code or otherwise prohibit separate reporting.

A claim or appeal received after the payer’s applicable filing deadline, subject to contract terms and any permitted exceptions.

Reporting a diagnosis or service code that represents a higher level, severity, or payment than the documentation supports; intentional upcoding may constitute fraud.

The Unique Physician Identification Number was a six-character Medicare identifier replaced by the NPI for standard transactions; it may still appear in historical records.

A payer methodology that compares a charge with amounts considered usual, customary, or reasonable for a service and market; the definition and calculation are payer-specific.

A plan rule limiting how often, how long, or how much of a covered service is payable within a defined period.

The review of requested or delivered healthcare services against coverage, medical-necessity, setting, and efficiency criteria.

ICD-9-CM V codes described factors influencing health status and encounters not primarily due to illness or injury; U.S. diagnosis reporting now uses the applicable ICD-10-CM Z codes.

Insurance or a statutory benefit system that covers eligible work-related injuries and illnesses; billing and authorization rules vary by jurisdiction and program.

An amount removed from accounts receivable for a documented reason, such as a contractual adjustment, approved financial assistance, administrative policy, or uncollectible balance. It should not be used to bypass valid refund or compliance obligations.