Alphabet Soup of American Medicalese: Acronyms, Names and Terms in Common Health Care Use

Compiled by R. Hewlett Lee, M.D.

Former Executive Director, Palo Alto Medical Clinic, retired
Member of the Board of Trustees, Palo Alto Medical Foundation

Any views expressed in the following definitions are his own.

Are you bewildered by all the "alphabet soup" of health careacronyms these days? The "Alphabet Soup of American Medicalese,"includes brief definitions of everything from the commonly used HMO(Health Maintenance Organization) to the brand-new CHIP (the newChildren's Health Insurance Program recently signed by PresidentClinton). It also includes names and terms in common use.

A | B | C |D | E | F |G | H | I | J |K | L | M
N | O | P |Q | R | S |T | U | V |W | X | Y | Z

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A

AAPCC Average Area Per Capita Cost. Medicare system of determining the costs of delivering care to Medicare recipients. This is used as the basis for reimbursing the providers of care to Medicare patients. It is considered seriously flawed because of out-of-date statistics that were felt to be incorrect to begin with.

ACMGA American College of Medical Group Administrators. An association of highly qualified administrators of group practices. Fellowship requirements are rigorous.

ACMPE American College of Physician Executives. A credentialing and development arm of MGMA.

AGPA American Group Practice Association. The professional association of medical group practices based in Washington, D.C. Primarily supported by multi-specialty groups, but single specialty groups are also members.

AHCPR Agency for Health Care Policy and Research. A federal agency dedicated to improving health care quality.

AHPs Accountable Health Plans. In "Managed Competition" these will compete with other AHPs on the basis of cost and quality. These will provide a comprehensive set of benefits, meet underwriting requirements, have no selection on basis of risk, combine delivery andfinancing of health care, and be held publicly accountable for quality.

AHPB Adjusted Historical Payment Basis. A very complex system for physicians and groups to use as a basis for planning. The federal Heath Care Financing Administration (HCFA) will reimburse physicians for Medicare patients the full fee (government) schedule amount if the fee is within 15% of the schedule amount, less 5.5% to assure budget neutrality. It is a very complex system for physicians and groups to understand and use as a basis for planning.

AMA American Medical Association. Trade association of practicing physicians.

AMGA American Medical Group Association. New trade association of group practices formed by the unification of the AGPA and UMGA. Based in Washington DC.

AMI American Medical International. Troubled international company owning many hospitals. Has mostly divested itself of health-insurance programs that were financially unsuccessful.

ASCs Ambulatory surgical centers, or outpatient surgery centers. Medicare coverage is just beginning for these facilities.

ASOs Administrative Services Only. This is a health plan wherethe employer is at total risk for the paymant of benefits, theadministrative services being provided by the insurance company. Withthe employers paying the benefits, the reasoning is that the payments toproviders will be negotiated by the employer and significant savingsaccrue to the employer.

B

BBA Balanced Budget Act of 1997. Frequently referenced to bring large savings ($115 billion from 1998-2002) in the Medicare program by restricting physician's reimbursement.

C

CAPITATION Providers are paid a fixed amount each month (or other negotiated time period) for providing services on a per-person (or"capitated" as in "head count") basis. The payment amount does not depend on the amount of care or service provided. This type of payment to providers is rapidly spreading throughout the UnitedStates, and is the main payment method used in health maintenance organizations (HMOs).

CAREGIVER A term used increasingly to describe persons who provide the bulk of the physical, financial and other care for other persons who are unable to care for themselves due to illness, injury ordisability. Most often used in the context of a spouse, adult child or other relative providing care for an older or chronically ill person.

CERTS Centers for Education and Research Therapeutics. Designed by the FDA modernization program passed in 1997 to provide information to effectively improve the effective utilization of new medical products.

CFs The national "conversion factor" used with the Medicare fee schedule. This is a single national number used by all carriers in calculating payments under the Medicare fee schedule.

CHAMPUS The federal government's name for its health plan for military dependents.

CHIP Children's Health Insurance Program. New legislation signed by President Clinton to expand health insurance to children whose parents earn too much for Medicaid yet not enough for private medical insurance.

CLIA Clinical Laboratory Improvement Act. Requires clinical labs to have an internal quality-assurance system. Proficiency testing by government-approved testers will occur.

CLINIC CLUB A national organization of 11 comparable clinics that meets annually for in-depth discussions of mutual interests and problems.

CMA California Medical Association. Trade association for California's practicing physicians.

CO-PAYMENTS Money paid to physicians, hospitals and labs, usually at the time of service. It is generally a small sum designed to discourage unnecessary or unneeded services to help control health care costs.

CPT Current Procedural Terminology. An AMA booklet listing by number all office and hospital procedures performed by physicians. Used by the government in planning reimbursement.

CRNAs Certified Registered Nurse Anesthetists. Work independently in rural areas, or under supervision in major centers.

D

DEDUCTIBLE A portion of the health-insurance premium paid by the person receiving the coverage. Use of deductibles is an effort to reduce the overall cost of paying for care to the government or insurance company carrying the health policy.

DEPARTMENT OF INSURANCE The State of California department that has jurisdiction over fee-for-service health plans.

DHS California's Department of Health Services. Also known as the State Department of Health. Runs MediCal, Crippled Children's Service, and other programs.

DRGs Diagnosis Related Groups. Medicare's method of paying hospitals based on diagnosis rather than for services given. Payments being reduced by the government are putting real financial stress upon hospitals.

DSA Digital Subtractive Angiography. An X-ray technique allowing arteries to be visualized by intravenous rather than intra-arterial injection. It is thus a safer outpatient procedure instead of in-hospital procedure.

E

ETs Expenditure Targets. Levels above which physicians would have to reimburse the government for spending more than budgeted amounts. It is vigorously opposed by AMA, and as of 1996 has not been adopted.

F

FACMGA Fellow of the American College of Medical Group Administrators. A fellow is an administrator who has met the difficult admission criteria to be admitted to the college.

FACP Fellow of the American College of Physicians. A title often used by physicians following their M.D.'s that denotes meeting challenging professional standards in internal medicine, indicating a high level of expertise.

FACS Fellow of the American College of Surgeons. An honorary degree awarded surgeons for professional excellence and having met requirements of full surgical training, certification and taking a special examination.

FPA Family Practice Associates. An aggressive company that has acquired many primary care physicians and specialists practices, beginning in San Diego, but now in 28 states, and has gone public, is rapidly growing, and has been emphasizing managed care products. A PPM.

G

GAFs Geographical adjustment factors. Used by Medicare to adjust fee schedules.

GATEKEEPERS The physician (usually a primary care doctor) who determines which services a patient will receive and when and where specialty referrals will occur. High-tech lab and X-ray procedures usually are under the control of the gatekeeper.

GHIA Group Health Insurance Association. Trade association of HMO plans.

GPCI Geographic Practice Cost Indices. Recognizes that geographic differences in the delivery of care exist. May be taken into effect as HCFA establishes payment amounts for Medicare.

H

HCFA Heath Care Financing Administration (often called "Hicfa"). A federal Department of Health and Human Services group that is responsible for paying Medicare physician and hospital bills.

HEALTH ALLIANCES A new term being used by the Clinton Administration instead of HPPCs (Health Plan Purchasing Cooperatives). A health alliance will be a purchasing cooperative offering Affordable Health Plans (AHPs) to employers and individuals. The plans will be rated on the basis of cost and quality.

HEDIS Health Employers Data Information Set. A standard used by employers to compare the quality and services offered by healthplans, group practices, hospitals.

HHS The federal Department of Health and Human Services. A cabinet-level agency that is responsible for all federal health programs.

HIAA Health Insurance Association of America.

HIPAA Health Insurance Portability and Accountability Act. A government effort to reduce fraud and abuse, stating that a claim for a service based on incorrect coding can result in civil or monetary penalties.

HMO Health Maintenance Organization. A Nixon-administration name that has stuck for capitated prepaid health plans. They may begroup models or hospital-based models, or individual physicians contracting.

HOSPICE A facility or program providing day care or support and counseling services for the terminally ill.

HPPCs (pronounced hip-pics) Health Plan Purchasing Cooperatives. In the concept of "Managed Competition" these will be non-governmental not-for-profit organizations created to help individuals, and small and large businesses purchase health insurance from Accountable Health Plans. HPPCs are being strongly advocated by the Jackson Hole Group (a health-policy "think tank") as a major component in health-reform legislation. HPPCs have been tried sucessfully in California.

HPSAs Health Professional Shortage Areas. Physicians will be paid a 10% additional amount to the Medicare fee schedule for services provided in these designated areas. (Usually about 30% less than urban areas receive).

I

INDEMNITY Traditional health-insurance coverage in which physicians, patients or health institutions send medical bills to the insurance company for payment--classical "fee-for-service" coverage. Increasingly being supplanted by managed care programs.

INTEGRATED HEALTH CARE An organization combining all aspects of health care services in an accountable and coordinated fashion,including physicians, hospitals, outpatient surgical facilities, drugs, ambulances, home care, and other services and providers.

IPA Independent Practice Association. A group of individual physicians or small group practices banded together to contract to deliver HMO or PPO services. Usually based around a hospital staff membership.
J

K

KNOX-KEENE A California statute that governs prepaid (HMO)plans in California to see that they are properly financed and have adequate staffs and proper reserves. All prepaid plans must have Knox-Keene approval before marketing. This often takes considerable time.

L

M

MAAC Maximum Allowable Actual Charges. The highest amount any practicing physician is allowed to bill a Medicare patient. This amount billable is gradually becoming relatively less because inflation is not properly considered in the MAAC.

MANAGED CARE A recent concept of how patients are cared for by physicians, outpatient facilities and hospitals, where cost-effectiveness and outcomes of procedures are central components of the care program allowed. Managed care can include HMOs, preferred-provider programs, government programs and is spreading to indemnity programs.

MCA Medical Care Administrators. A company providing claims processing, utilization review, quality assurance, marketing, sales and certain computer services. PPA, a network of California clinics, contracts with MCA to handle small-group products and increasingly with large employers and companies that are self-insured.

MEDICAID The name given to federally mandated programs for thepoor. Each state must supply half the funds. It is considered grossly underfunded. It promises care for the poor, but it is terribly inadequate in what it actually delivers. It has been called a national disgrace and a federal fraud.

MEDI-CAL California's name for its program for the poor and disabled. It is in very serious trouble because of massive underfundingand is increasingly being considered a disgrace for California. Hospital reimbursement is terrible, physician reimbursement now about 21% of usual. Many of the poor being denied care because of the underfunding.

MEDICARE The federal program of health care for the elderly and long-term disabled. Under pressure because of the budget deficits and high continuing costs of the program.

MEDIGAP The difference between what Medicare pays and what physicians are allowed to charge. Currently Medicare pays 54% of physicians usual charge, and physicians can bill 20% more (to a total of 72% of their usual charge).

MEI Medicare Economic Index. The providers' costs to delivercare to Medicare patients. Includes geographic differences, malpracticecosts, costs of salaries and other things.

MGMA Medical Group Management Association. Professional association of medical group practices. Mainly structured for medical group administrators.

MRI Magnetic Resonance Imaging. A computerized machine thatmeasures the output (resonance) produced when a patient is placed in a magnetic field. Produces spectacular images of the different organs. Particularly useful in diagnosis of brain and spinal-cord lesions.

MSAs Medical Savings Accounts. Setting aside money to pay health care costs in plans that are seeking government approval

MVPS Medicare Volume Performance Standards. Based on rate of medical inflation, increase in Medicare recipients, and a five-year average in increase in Medicare services.

MRMIBS Major Risk Medical Insurance Boards (called "Mr.Mibs"). A California entity created by the state to assist with the purchasing of health insurance of an affordable and high-quality type.

N

NATIONAL HEALTH BOARD (NHB) The federal entity that would oversee the implementation of the Clinton Administration's Health Security Act, if that plan emerges from the political process. The NHB would consist of seven members, each with a four-year term, appointed by the President and confirmed by the Senate.

NPs Nurse Practioners. Nurses with extra, specialized training that enables them to assume extra responsibilities in the care of patients.

O

OBRA Omnibus Budget Reconciliation Act of 1989. A bill producing major changes in Medicare reimbursement for physicians. Limits on allowable charges, a fee schedule in the future, caps on balance billing, reduction of "overpriced" procedures.

OUTCOMES In the new health-reform legislation, the end results of medical treatment and procedures (outcomes) will be measured. Survivors (morality) level of patient satisfaction, complications (mobidity), degree of functional restoration and return to employmentall will be included in the evaluation. Results will be publicly available and published by the government. AHPs will compete on the basis of outcomes and cost.

P

PAs Physician Assistants. Certified and trained professionals now allowed to perform many duties formerly done by physicians, such as physical exams, suturing lacerations and other procedures.

PART A The hospital part of Medicare.

PART B The physician payment side of Medicare.

PHOs Physician-Hospital Organizations. PHOs are forming now to try to strengthen the position of individual physicians and hospitals to enable them to compete and contract better in the competitive times ahead.

PHP A prepaid health plan. Take Care and Kaiser Permanente are examples of PHPs.

PHYCOR A large national Physician Management Company.

PPA Preferred Providers of America. A company formed by ten group practices situated at strategic spots throughout California that networks with 55 additional clinics to provide contracting strength to enable them to negotiate more effectively with insurers.

PPM Physician Practice Management company. A company that acquires physicians practices and salaries the primary care doctors, contracts for them, hires their employees and so on.

POS "Point of Service" plans that allow the subscriber to see physicians outside the controlled network. Usually the plans are more expensive, and have significant co-pays for out-of-network services.

PPO Preferred Provider Organization. A company that has contracts with physicians, hospitals, and other providing organizations to deliver care at specific costs, usually discounted. Legalized in most states now after pressure by insurance companies and industry in an attempt to lower health care costs.

PPS Prospective Payment System. A federally mandated method of paying hospitals for Medicare recipients' services. SeeDRGsabove).

PPRC Physician Payment Review Commission. An advisory panel to Congress to recommend changes in the federal program's physician-reimbursement policies and amounts.

PRACTICE GUIDELINES Summaries of treatment practices approved on the basis of cost, need and outcomes.

PRO Professional (Peer) Review Organization. A group of physicians and lay people who review appropriateness of outpatient and inpatient health care.

PROPAC Prospective Payment Assessment Commission. Federal commission that annually is supposed to figure out the level of payments to hospitals for federally covered recipients.

PROVIDER Awidely used term to describe those persons or entities (such as hospitals) that provide health care to patients. This term is intensely disliked by physicians, who regard themselves as doctors, not "providers."

PSOs Provider Sponsored Organizations. Organizations of physicians, group practices, hospitals that can create a health plan product such as an HMO, PPO etc.

Q

QA Quality Assurance. Care is reviewed for appropriateness and quality by group practices, hospitals and now insurers.

R

RECOVERY INN A short-stay, post-surgical facility that can provide pain relief and intravenous fluid, support with ambulation, in lieu of hospital admission. Can be a major cost-saving facility, with charges that are usually half to one-quarter of hospital charges for the same period.

RESPITE CARE A system to provide regular or special relief to persons or families providing care for persons unable to care for themselves. It also is a proposed Medicare benefit.

RBRVS Resource Based Relative Value Scale. A method of deciding the relative worth of medical procedures by using the effort, education, time spent, risk, cost of delivering the procedure and complexity of the procedure. Being adopted by the federal government to determine how much to reimburse physicians for any given procedure.

S

SINGLE PAYER A proposed program of health-insurance coverage where one agency makes all of the payments to providers of care. The government (state or federal) sets the policies, and the single agency(governmental or private) administers the payments. The Canadians have a single-payer plan.

SNF Skilled Nursing Facility. A convalescent facility with enough nurses and support staff to supply a higher level of care than many more traditional "nursing homes."

SURGERY CENTER (or outpatient surgery center). A free-standing ambulatory surgical facility where operations are performed at significant savings to the patients (or their insurance carriers) outside of the hospital setting.

T

TQM Total Quality Management. A new term for improving quality at all levels to provide increasing patient (customer) satisfaction and group-practice efficiency. Covers all aspects of management and clinical care.

U

UCR Usual, Customary and Reasonable. A 24-year-old system of reimbursing physicians based on charges being "usual, customary and reasonable." Being replaced by fee schedules, contracted amounts, RBRVS amounts (see above), and maximum allowable actual charges.

UMGA Unified Medical Group Association. A large association of group practices primarily in Southern California that now is involved in HMO contracting. It is experiencing many mergers of large Los Angeles group practices and is spreading widely in Northern California.

UR Utilization Review. A program initiated by groups to ensure proper hospitalization and utilization of high-technology services that has now been adopted by insurers to keep an eye on and control healthcare services.

V

VAT Valued Added Tax. Similar to a sales tax. Proposed by many in Congress to be a method of financing health reform.

W

WIC Widows, Infants and Children. A special fund created inthe Health Reform Act to insure that all previously established healthbenefits for widows, infants and children will be fully funded.

X

Y

Z