ACA Glossary

Plain-English definitions of the words you'll encounter when shopping the Health Insurance Marketplace.

APTC (Advance Premium Tax Credit): A federal tax credit applied in advance, month by month, to lower the monthly premium you pay for a Marketplace plan. The amount depends on your projected household income and family size.
Balance Billing: When an out-of-network healthcare provider bills you for the difference between what they charge and what your insurance pays. Largely banned for emergency care and most out-of-network care at in-network facilities under the federal No Surprises Act, which took effect January 1, 2022.
Benchmark Plan: The second-lowest-cost Silver plan in your county, used by the federal government as the anchor for calculating your Advance Premium Tax Credit. Your subsidy is the benchmark price minus your expected contribution, and that same dollar amount applies whether you pick a Bronze, Silver, Gold, or Platinum plan.
Certified Application Counselor (CAC): A trained, CMS-certified enrollment helper who works at a hospital, community health center, or nonprofit. Like a Navigator, a CAC provides free, neutral help with Marketplace, Medicaid, and CHIP applications, but their organization is not funded by a CMS grant.
Claims Appeal: The formal process to challenge an insurance company's decision to deny a medical claim or refuse to pay for a service. Federal law guarantees a two-level appeal: an internal review by the insurer, followed by an independent external review.
Coinsurance: A percentage of the cost of a covered health service that you pay after meeting your deductible, with your insurance plan paying the rest.
Coordination of Benefits (COB): The set of rules that determine which insurance plan pays first when you are covered by more than one (for example, your Marketplace plan plus a spouse's employer plan, or Medicare plus a retiree plan). One plan is designated primary and pays first; the others are secondary and may pay the remaining balance up to their own limits.
Copay: A fixed dollar amount you pay for a covered health service at the time you receive care, such as $30 for a primary care visit.
CSR (Cost-Sharing Reduction): An extra subsidy for lower-income enrollees who pick a Silver Marketplace plan. CSRs lower your deductible, copays, coinsurance, and out-of-pocket maximum — not your premium.
Deductible: The amount you must pay out of pocket each year for covered health services before your insurance plan starts to pay.
EOB (Explanation of Benefits): A statement from your health insurance plan describing how a specific claim was processed, including the total cost, what the plan paid, and what you owe.
EPO (Exclusive Provider Organization): A hybrid plan network: no PCP required, no referrals to specialists, but coverage is in-network only (no out-of-network coverage except emergencies). Mid-range premium between HMO and PPO.
Essential Health Benefits (EHB): The 10 categories of healthcare services that the Affordable Care Act requires every Marketplace plan to cover. No ACA-compliant plan can leave any of the 10 categories out, regardless of the metal tier or carrier.
Federal Poverty Level (FPL): An income threshold set by the federal government that determines eligibility for Marketplace subsidies, Medicaid, and many other safety-net programs. Updated annually and varies by household size.
Formulary: The list of prescription drugs a health insurance plan covers, including which tier each drug falls into for copay or coinsurance purposes.
FSA (Flexible Spending Account): An employer-sponsored account that lets you set aside pre-tax money from your paycheck to pay for qualified medical expenses. Available only through an employer, with a use-it-or-lose-it rule at year-end.
Hardship Exemption: An official Marketplace determination that an individual circumstance (homelessness, eviction, a death in the family, unaffordable coverage, etc.) qualifies a person for relief. Most commonly used today to make enrollees over age 30 eligible for a Catastrophic plan.
HMO (Health Maintenance Organization): A plan network type where you choose a primary care physician (PCP), need referrals to see specialists, and are generally only covered in-network — except for emergencies.
HRA (Health Reimbursement Arrangement): An employer-funded account that reimburses you for qualified medical expenses, sometimes including the premium for an individual Marketplace plan. Only employers contribute, and the account stays with the employer if you leave.
HSA (Health Savings Account): A tax-advantaged personal account you can use to pay for qualified medical expenses, available only if you are enrolled in a High-Deductible Health Plan (HDHP). Money goes in pre-tax, grows tax-free, and comes out tax-free when used for healthcare.
In-Network: Doctors, hospitals, labs, and pharmacies that have signed a contract with your insurance company to provide care at pre-negotiated rates. Using in-network providers gives you the lowest cost-share and full plan benefits.
MAGI (Modified Adjusted Gross Income): The specific income figure used to determine eligibility for premium tax credits and Medicaid. It is your adjusted gross income (AGI) plus a few add-backs, most commonly non-taxable Social Security, tax-exempt interest, and excluded foreign income.
Metal Tiers (Bronze, Silver, Gold, Platinum): The four standard ACA Marketplace plan categories sorted by how much of your medical costs the plan pays on average. Bronze pays about 60%, Silver 70%, Gold 80%, and Platinum 90%, with premiums rising as the tier goes up.
Navigator (ACA Navigator): A federally-certified, CMS-funded enrollment helper who provides free, unbiased assistance with Marketplace, Medicaid, and CHIP applications. Navigators must complete federal training, must remain neutral, and cannot recommend specific plans or earn commissions.
Network: The group of doctors, hospitals, pharmacies, and other providers contracted with a health insurance plan to provide care at negotiated rates.
Network Adequacy: Federal and state regulations that require health plans to maintain a provider network sufficient in size, geographic distribution, and specialty mix so that enrolled members can actually get the care their plan promises.
Open Enrollment Period (OEP): The annual window, typically November 1 through January 15 in most states — when anyone can enroll in or change Marketplace coverage for the coming year, without a qualifying life event.
Out-of-Network: Doctors, hospitals, and other providers who do NOT have a contract with your insurance company. Care from out-of-network providers usually costs much more, and on some plan types is not covered at all outside of emergencies.
Out-of-Pocket Maximum: The most you have to pay for covered health services in a plan year. After you reach this amount, your insurance pays 100% of covered services.
PPO (Preferred Provider Organization): A plan network type that lets you see any doctor without referrals — in-network at lower cost, out-of-network at higher cost. No PCP requirement.
Premium: The amount you pay each month to your insurance company to keep your health insurance plan active, regardless of whether you use any care.
Prescription Drug Tier: The pricing level your plan assigns to a covered prescription drug on its formulary. Tiers run from Tier 1 (preferred generics, lowest copay) up to Tier 5 (specialty drugs, highest cost-share), and they determine how much you pay at the pharmacy.
Preventive Care: Healthcare services that the ACA requires all Marketplace plans to cover at 100% with no cost-sharing when received from an in-network provider. You pay nothing, even if you have not met your deductible. Around 85 services qualify, including annual checkups, screenings, immunizations, and women's and pediatric preventive care.
Prior Authorization: Approval from your health insurance plan before a specific procedure, medication, or test is performed. Without it, the plan may refuse to pay.
Qualified Health Plan (QHP): An insurance plan certified by the Marketplace as meeting ACA standards — it covers all 10 essential health benefits, caps out-of-pocket costs, prohibits preexisting-condition exclusions, and qualifies for federal subsidies.
Qualifying Life Event (QLE): A specific life change (job loss, marriage, birth, move, etc.) that opens a 60-day Special Enrollment Period during which you can sign up for Marketplace coverage outside the annual Open Enrollment window.
Referral: Written or electronic authorization from your primary care doctor allowing you to see a specialist or receive certain services, required by some health plans before the plan will cover the visit.
Silver Loading: An insurer pricing strategy adopted after 2017 in which the cost of Cost-Sharing Reductions (CSR) is built into Silver plan premiums only. Because the benchmark used for federal subsidies is a Silver plan, this raises Advance Premium Tax Credits across the board, often making Bronze plans effectively free for low-income enrollees.
Special Enrollment Period (SEP): A 60-day window outside Open Enrollment when you can sign up for a Marketplace plan because of a qualifying life event: losing other coverage, marriage, birth, moving, citizenship, etc.
Step Therapy: An insurance requirement that you try one or more lower-cost drugs first before the plan will approve coverage of a more expensive medication. If the cheaper drug fails or causes side effects, the plan steps you up to the next option. Common for biologics, specialty oncology, and some autoimmune therapies.