Medicare Glossary

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Term Definition
Coordinated Care

See Managed Care.

Coordinated care plan

CMS terminology for a plan that includes a CMS-approved network of providers that are under contract or arrangement with the Medicare + Choice organization to deliver the benefit package approved by CMS.


A plan benefit cost-sharing feature involving a set flat amount per service to be paid by the member

Creditable Coverage

The Medicare Modernization Act (MMA) requires entities (whose policies include prescription drug coverage) to notify Medicare eligible policyholders whether their prescription drug coverage is creditable coverage, which means that the coverage is expected to pay on average as much as the standard Medicare prescription drug coverage. For these entities, there are two disclosure requirements: 1) to provide a written disclosure notice to all Medicare eligible individuals annually who are covered under its prescription drug plan; and 2) to complete the annual Online Disclosure to CMS Form to report the creditable coverage status of their prescription drug plan.


A specified amount of dollars that is deducted (and thus the subscriber is entirely responsible for) before benefits apply.

Demonstration Projects

Projects and contracts that CMS has signed with various health care organizations. These contracts allow CMS to test various or specific attributes such as payment methodologies, preventive care, social care, etc., and to determine if such projects/pilots should be continued or expanded to meet the health care needs of the Nation. Demonstrations are used to evaluate the effects and impact of various health care initiatives and the cost implications to the public.

Diagnostic Related Group

Diagnostic Related Groups (DRGs) are used to reimburse hospitals and other healthcare providers. They are a means of classifying inpatient hospital services, where they are rated, based on diagnoses, procedure, age, sex, and intensity of services.

Doughnut Hole

In regard to the Medicare Part D prescription drug benefit, refers to the annual gap in coverage after both the deductible is met and 25% coinsurance applies to the next level of coverage in drug costs; then 100% of prescription costs are out of pocket up to a specified amount, and then the "doughnut hole" is ended and 95% coverage/5% coinsurance applies the remainder of the year. Under the Affordable Care Act, the doughnut hole will be phased out by 2020.


See Diagnostic Related Group.

Dual Eligible

A Medicare beneficiary who qualifies for some assistance from Medicaid. A dual eligible may qualify either for full Medicaid benefits, or only for Medicaid coverage of Medicare cost-sharing amounts.


Encounter Data Processing System


A process used by the Plan and providers to determine if a person is a covered member by the Plan at the time provider services are to be rendered. If so, the person is determined to be an eligible Member. If not, they are determined to be ineligible.

Encounter Data Processing System

(EDPS) A CMS initiative to collect Part C utilization and cost data from Medicare Advantage plans. CMS will use the encounter data to measure and price utilization in the managed care sector.

ESRD Eligibility Requirements

To qualify for Medicare under the renal provision, a person must have ESRD and either be entitled to a monthly insurance benefit under Title II of the Act (or an annuity under the Railroad Retirement Act), be fully or currently insured under Social Security (railroad work may count), or be the spouse or dependent child of a person who meets at least one of the two last requirements. There is no minimum age for eligibility under the renal disease provision. An Application for Health Insurance Benefits Under Medicare for Individuals with Chronic Renal Disease, Form HCFA-43 must be filed.

ESRD Facility

A facility, which is approved to furnish at least one specific, ESRD service. These services may be performed in a renal transplantation center, a renal dialysis facility, self-dialysis unit, or special purpose renal dialysis facility.