Health care glossary: What they're talking about

Confused by some of the jargon you've heard related to managed health care? Here are a few of the more important terms that have come from this fast-growing industry:

Capitation: When an HMO pays primary-care physicians a fixed monthly or quarterly fee for each patient in their care. Doctors are expected to use that pool of money to cover all patient care, from routine checkups, to referrals, to specialists. If the cost of patient care is less than the fee, doctors keep the difference. If it's more, doctors must absorb the extra cost.

Deselected: When an HMO drops a doctor from its network because it is dissatisfied with the doctor's performance. It could be for any number of reasons, from failing to stay within the HMO's budget to providing substandard care. According to sources on both sides of the managed-care debate here in Massachusetts, this happens rarely here.

Drive-by and drive-through procedures: To save the cost of long-term hospital stays, HMOs increasingly push for more outpatient operations (drive-by mastectomies) and 24-hour hospital stays (drive-through hysterectomies).

Gag rules: Clauses within HMO contracts that prohibit physicians from telling their patients about expensive treatment alternatives, how they are paid by the HMO or anything bad about the health plan. While there have been reports of gag rules in other parts of the country, local HMOs question whether such contract clauses exist. In Massachusetts, a recent law protects physicians who tell their patients about treatment alternatives. Also, the state's attorney general has recommended legislation that would prohibit HMOs from including any gag rules in their contracts.

Leakage: When an HMO member chooses to see a doctor outside the health plan's network of primary-care physicians and specialists. Sometimes the patient pays his own way. Other times the HMO pays a portion of the medical costs equal to what it would have cost within the network. It's considered leakage because the network loses money or a patient every time it happens.

Preferred provider organization: Also known as a PPO, this health insurance plan is a hybrid of traditional fee-for-service policies and HMOs. A PPO has a network of doctors that patients are encouraged to use. However, patients can see doctors outside the network if they pay a higher fee.

Utilization review: When an HMO keeps track of every service a doctor provides to prevent overtreatment and undertreatment. Most HMOs review doctors' records to monitor what drugs they prescribe, what tests they order and how many referrals they make to specialists. Some HMOs also require doctors to get permission for everything from ordering tests to doing surgery.

Withholds: The portion of a doctor's salary that is withheld by an HMO to encourage the physician to stay within the health plan's budget. If he does, he gets the money at the end of the year. This is one of the various ways HMOs provide incentives for doctors to cut costs.