1. Health care services covered by insurance that are necessary to preserve and maintain the health of a member of a managed care plan. The medical service provided must be necessary, appropriate according to current standards of medical practice, provided in the most appropriate setting, and performed at the proper level of service. 2. Cal. Wel. & Inst. Code 14059.5 defines medical necessity when it is reasonable and necessary to protect life, to prevent significant illness or significant disability, or to alleviate severe pain. See also medical necessity and medically (or psychologically) necessary services .

That portion of a patient’s inpatient hospital stay during an episode of illness or injury that is called excessive when care may be given in a less expensive or more efficient setting. It may be considered too long a stay when considering current standards of good medical practice.

Persons in need of financial assistance and/or whose income and resources will not allow them to pay for the costs of medical care. Also called medically indigent in some states. See also charity allowance and charity care .

County, group of counties, or neighborhood that is considered to have three shortage area categories: primary care, dental care, and mental health care. Designation of a particular service area is based on the percentage of population below poverty level, percentage of population age 65 and older, infant mortality rate, and ratio of primary care physicians per 1000 population.

Medicare frequency edits that limit the number of units of service (UOS) that a provider may bill for certain HCPCS/CPT codes on an insurance claim for the same beneficiary on the same date of service. MUEs were developed to catch errors and prevent inappropriate payments and are applied to each line of the claim. Thus the entire claim is not denied, and the provider only appeals the denied codes.

Nationwide federal government health insurance program for persons age 65 years and older, people with certain disabilities, and people of all ages with end-stage renal disease (permanent kidney failure requiring dialysis or kidney transplant). This program is administered by the Centers for Medicare and Medicaid Services, formerly known as the Health Care Financing Administration (HCFA) . Local Social Security offices take applications and supply information about the program. This fee-for-service health plan lets the patient go to any physician, hospital, or other health care supplier who accepts Medicare and is accepting new Medicare patients. The patient pays the deductible. Medicare pays its share of the Medicare-approved amount, and the patient pays his or her share (coinsurance). The Original Medicare Plan has two parts: Part A (hospital insurance) and Part B (medical insurance). Also called Original Medicare Plan or Medicare fee-for-service plan .

1. Organ- ization under contract to the state to process claims for a state Medicaid program. Also see A/B jurisdictions . 2. Insurance carrier that enters into an agreement with the Centers for Medicare and Medicaid Services (CMS). It receives and processes claims from physicians, hospital facilities, other suppliers of service, and durable medical equipment (DME) for Parts A and B of Medicare. Medicare contractors must have the provider customer service program (PCSP) in place to assist physicians and their staff in understanding and complying with Medicare’s operational processes, policies, and billing procedures. Formerly referred to as fiscal intermediary , Medicare carrier, fiscal agent, Medicare Part B carrier , or contractor . Also see Medicare Contracting Reform (MCR) and A/B jurisdiction .

Plan offered by a private insurance company that contracts with Medicare to provide beneficiaries with Medicare Part A and Part B benefits. Depending on where the patient lives, plans may or may not offer Medicare Part D prescription drug coverage. A Medicare Advantage Plan can be a health maintenance organization (HMO) plan, preferred provider organization (PPO) plan, special needs plan, or a private fee-for-service plan. In 2006 MA replaced the Medicare Plus (+) Choice program. Also referred to as Medicare Health Plans .