Common Billing Terminology

An Advanced Beneficiary Notice is a form advising you that tests performed by your doctor may not be covered by Medicare. The purpose of the ABN is to let you know in advance that these services may not be covered and to advise you that you will be responsible for payment of these charges.

Assignment of Benefits means the physician agrees to accept payment from an insurance company first and then bill the patient for any after-insurance balances. In this arrangement, the patient has assigned rights for payment, via signature, to the physician for services rendered.

A summary of current activity on an account.

The Birthday Rule is endorsed by the National Association of Insurance Commissioners (NAIC). The Birthday Rule states that the plan of the parent whose date of birth (month and day) falls earlier in the calendar year is the primary plan for dependent children. For example, if the father’s birth date is March 4 and the mother’s birth date is January [..]

The information billed to the insurance company for services provided.

Co-insurance is an arrangement by which the patient and the insurance company share in the payment of a service. Co-insurance takes effect after the approved deductible amount has been met. For example, assigned Medicare benefits have a 20 percent co-insurance. This means that after the approved deductible amount has been met, Medicare pays 80 perc [..]

Coordination of Benefits is the determination of benefits payable under more than one group health insurance so the insured’s total benefits do not exceed 100 percent of the medical expenses.

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

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. Nonparticipati [..]