Estimated average cost of Medicare benefits in a given region for an individual. It is based on criteria such as age, sex, institutional status, Medicaid, disability, and end-stage renal disease (ESRD) status. Centers for Medicare and Medicaid Services (CMS) uses AAPCC as a basis for making monthly payments to managed care plans.

System developed by Johns Hopkins University that is a comprehensive family of measurement tools designed to help explain and predict how health care resources are delivered and consumed. ACGs are based on building blocks called aggregated diagnosis groups (ADGs). See aggregated diagnosis groups (ADGs).

Annual calculation of premium (payment rates) that health plans would have received for their Medicare enrollees to provide Medicare-covered benefits if paid their private market premiums. This is done to adjust subsequent year supplemental benefits or premiums to return any excess Medicare revenue above the ACR to enrollees. Also called average community rate (ACR). See adjusted average per capita cost (AAPCC).

Used by managed care plans to determine group rates for each group’s expected use of medical services during an upcoming contract period. Also known as factored rating or community rating by class (CRC).

Schedule showing names of a small amount of drugs often prescribed to long-term patients that can be modified from time to time by the managed care or insurance plan. Also called a drug maintenance list.

1. Accounts receivable amount showing the write-off portion from the total gross charges of amounts that by law or provider contract cannot be collected. 2. Medicare approved amount is the adjusted gross charge.

Average payment for the service in a locality under the current system. AHPB is based on the average prevailing charge Medicare paid all physicians in a particular geographic area for a specific service. “Adjusted” means reduced by a percent to ensure that the fee schedule phase-in is budget neutral. Medicare carriers used ADPBs to figure blended payment rates during the transition period before implementation of the RBRVS system of payment.

Amount of money that the Centers for Medicare and Medicaid Services will pay Medicare risk health maintenance organizations (HMOs) to cover a Medicare beneficiary. The rate is taken from the adjusted average per capita cost (AAPCC) based on health risk factors for the beneficiaries.

Special codes used by insurance carriers to explain the reason an insurance claim or a medical service was paid differently than the billed amount.

Reference list of coded explanations of changes made to a paid insurance claim. The codes detail and clarify all services reported and eliminate having to generate a separate letter of explanation.