Health Care Industry Terminology

A network of providers jointly responsible for the quality and total cost of care for a defined population under value-based contracts, sharing savings and sometimes losses.

Short-term, intensive treatment for severe injury, illness, urgent medical conditions, or during recovery from surgery, typically delivered in hospitals.

A non–fee-for-service payment approach that ties reimbursement to quality and cost outcomes (e.g., ACOs, bundled payments, PCMH), often including downside risk.

The average number of inpatient days per discharge; a key utilization and efficiency metric often benchmarked by DRG and case mix.

Comparing performance metrics to peer organizations or standards to identify gaps and drive improvement.

A single, predetermined payment for all services in an episode of care across multiple providers and settings, incentivizing coordination and cost control.

Organizing patient care activities and sharing information among stakeholders to achieve safer, more effective, and efficient care across settings.

A structured, multidisciplinary, evidence-based plan outlining best-practice steps and timelines for managing a specific clinical condition or procedure.

A weighted average of DRG relative weights representing the clinical complexity and resource intensity of a hospital’s patient population.

A hospital’s comprehensive list of billable items, procedures, and services with associated codes and prices, used to generate claims.

EHR-integrated tools (alerts, order sets, risk scores, guidelines) that deliver patient-specific recommendations to support clinical decision-making.

Processes that enhance the accuracy, completeness, and specificity of clinical documentation to reflect true patient severity, support coding, quality metrics, and reimbursement.

The U.S. federal agency administering Medicare, Medicaid, and quality programs, setting payment policies, coverage decisions, and data standards.

A standardized coding system maintained by the AMA for reporting medical, surgical, and diagnostic procedures and services, primarily for physician/outpatient billing.

A classification system that groups inpatient stays with similar clinical characteristics and resource use; used by Medicare to determine hospital payment per discharge.

A longitudinal digital system for storing, managing, and sharing patients’ clinical information, workflows, orders, and documentation across care settings.

Integrating the best current research evidence with clinical expertise and patient preferences to make care decisions.

A payment model that reimburses providers for each discrete service rendered, typically using CPT/HCPCS codes and fee schedules.

An approved list of prescription drugs covered by a health plan or hospital, often tiered and governed by clinical and cost-effectiveness criteria.

An infection a patient acquires during the course of receiving health care that was not present or incubating at admission.

The electronic sharing of health-related information across organizations, enabled by standards, networks, and governance frameworks.

U.S. law establishing national standards for the privacy and security of protected health information and for electronic transaction standardization.

A widely used set of standardized performance measures across preventive, chronic, and behavioral health domains, used by payers and regulators to assess quality.

A diagnosis grouping methodology used for risk adjustment to predict future health care costs, informing plan payments and quality comparisons.

A standardized, publicly reported patient experience survey for hospitals that influences reputation and certain payment programs.

U.S. clinical modification and procedure coding systems for diagnoses (CM) and inpatient procedures (PCS), enabling classification, reporting, and reimbursement.

A Medicare billing provision allowing certain non-physician services in an office setting to be billed under a supervising physician’s NPI if strict requirements are met.

The ability of different health IT systems to exchange, interpret, and use data seamlessly, enabled by standards, APIs, and governance.

A private-plan alternative to traditional Medicare in which plans receive risk-adjusted, capitated payments and manage networks, benefits, and quality.

A CMS payment program under QPP that adjusts physician FFS reimbursement based on performance in quality, cost, improvement activities, and promoting interoperability.

A unique, 10-digit identifier assigned to health care providers in the U.S. for standard transactions and billing.

The extent to which a health plan’s provider network meets time, distance, availability, and specialty access standards for enrollees.

A serious, preventable, and unacceptable adverse event (e.g., wrong-patient procedure) that should never occur if proper safeguards are in place.

Providers or facilities without a contract with a patient’s health plan, typically resulting in higher costs and different billing rules.

A primary care model emphasizing comprehensive, coordinated, accessible, and patient-centered care supported by data and quality improvement.

An intermediary that manages prescription drug benefits for payers, including formulary design, rebates, utilization management, and pharmacy networks.

The health outcomes of a group of individuals, the distribution of such outcomes, and strategies to improve them by addressing clinical and nonclinical drivers.

A payer requirement to obtain approval before delivering certain services or medications to qualify for coverage.

Individually identifiable health information regulated under HIPAA, including demographic data and medical details linked to a person.

A standardized metric used to evaluate health care performance, often categorized as structure, process, outcome, or patient experience measures.

A patient’s return to an acute care hospital within a defined period (often 30 days) after discharge; a key quality and cost metric.

End-to-end administrative and financial processes that capture, manage, and collect patient service revenue—from scheduling and coding to billing and collections.

A methodology that accounts for patient health status and demographics when setting payments or comparing outcomes, preventing bias due to case mix differences.

Nonmedical factors—such as housing, education, food access, transportation, and income—that influence health outcomes and health care utilization.

Quality performance scores (e.g., 1–5 stars for Medicare Advantage and Part D) based on clinical, experiential, and administrative measures that affect payment and marketing.

The use of telecommunications technologies to deliver clinical and related services remotely, including video visits, remote monitoring, and e-consults.

The process of prioritizing patients based on acuity and resource needs to allocate care efficiently and safely.

A framework for optimizing health system performance by simultaneously improving the patient experience, improving population health, and reducing per capita costs.

The evaluation of the medical necessity, appropriateness, and efficiency of health care services, often conducted prospectively, concurrently, or retrospectively.

Delivery and payment models that reward outcomes, quality, and cost efficiency instead of volume, often involving shared savings, capitation, or bundles.