1. Reduction of a normal charge based on a specific amount of money or a percentage of the charge. 2. In a managed care plan’s contract with a provider, the discount is the percentage deducted during settlement of the claim from the allowed amount.
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Discount is a reduction in premium in respect of some favorable features of the risk, e.g., discount for Fire extinguishing appliances or for freedom from claims, and where customary, as in marine Insurance, originating from a reward for prompt payment of premium.