2025 Medicare Glossary

Prescription Drug Plan Terms and What They Mean

A – D | E – H | I – L | M – P | Q – T | U – Z

Evidence of Coverage (EOC) and Disclosure Information:

This document, along with your enrollment form and any other attachments which explain your coverage, defines our obligations and explains your rights and responsibilities as a member of our Plan.

Exception:

When you have an approved coverage determination that allows you to get a drug that is not on the Blue MedicareRx formulary (formulary exception ) or to get a higher tier drug for a lower tier cost (tiering exception). Exceptions can also be made regarding quantity or dosing limits of a drug you are taking (quantity exception).

Explanation of Benefits (EOB):

An explanation of benefits (commonly referred to as an EOB) is a statement sent by the plan to members explaining what prescription drug services were paid for on their behalf and any costs that the member is responsible for. The EOB is not a bill.

Extra Help:

A Medicare program to help people with limited income and resources pay Medicare prescription drug program costs, such as premiums, deductibles, and cost-sharing.

Higher Cost Generic Drug:

A higher cost generic drug (generic drugs, short: generics) is a drug defined as "a drug product that is comparable to a brand/reference listed drug product in dosage form, strength, quality and performance characteristics, and intended use."

Grievance:

A grievance is a complaint or dispute (other than a coverage or payment dispute) expressing dissatisfaction with any aspect of the operations, activities, or behavior of a Medicare health plan, or its providers, regardless of whether remedial action is requested.

Health Insurance Portability and Accountability Act (HIPAA):

The Administrative Simplification provisions of the Health Insurance Portability and Accountability Act of 1996 (HIPAA, Title II) require the Department of Health and Human Services (HHS) to adopt national standards for electronic health care transactions and national identifiers for providers, health plans, and employers. Provisions under the Affordable Care Act of 2010 will further these increases and include requirements to adopt:

operating rules for each of the HIPAA covered transactions
a unique, standard Health Plan Identifier (HPID)
a standard and operating rules for electronic funds transfer (EFT) and electronic remittance advice (RA) and claims attachments.

In addition, health plans will be required to certify their compliance. The Act provides for substantial penalties for failures to certify or comply with the new standards and operating rules.