• Mehran Mehregany - QuantaEd Solutions, CEO

Must-Know Health Care Ecosystem Terminology

Updated: 5 days ago

Many of us working in digital health space have not been schooled in the U.S. health care system terminology. Here is a basic, but indispensable, overview. For an in-depth study, you are referred to “Essentials of U.S. Health Care Systems” by Shi and Singh [1].

The basic types of systems of care delivery in the U.S. are managed care, integrated care, Veterans Health Administration, and underserved care.In these systems, the patient (i.e., the covered person, referred to as ‘enrollee’ or ‘member’) is not the primary ‘payer’ for the services received.Employers or the government foot the bill for the most part.

Managed care is the dominant system; it integrates, coordinates and prices health care delivery functions. The above figure, adapted from [1], illustrates the elements and construction of a managed care system. The managed care organization acts like an insurance company to the employer or government, with its ‘plan’ analogous to insurance policy. The ‘plan’ sets forth the benefits and costs of care for the enrollees. Enrollees often contribute to a fraction of the plan premium through their employer. They also are usually responsible for a fraction of the cost of the care received, referred to as ‘copay’. Plans usually prescribe a set of health care ‘providers’, collectively referred to as the ‘network’. Out-of-network providers are usually not part of the plan benefit or require higher copay by the patient.

In integrated systems, a provider organization has integrated and coordinates its own network, through which it delivers comprehensive health care services. A few examples of such systems are Mayo Clinic, Kaiser Permanente, Cleveland Clinic, and Geisinger Health System. In contrast to managed care, integrated systems are both the provider and the insurer. The Veterans Health Administration is an integrated system by the government for the benefit of active and retired military personnel. It is part of the Department of Veterans Affairs (VA) and the largest integrated health system in the U.S.

The underserved systems, usually supported by the government or charitable funds, provide health care services (through community health centers, for example) to the uninsured—usually from the disadvantaged groups and communities. Government insurance programs such as Medicare (for qualifying senior citizens), Medicaid (for qualifying low-income citizens), and State Children’s Health Insurance Program (for children of uninsured families) additionally support the underserved.

Table 1 summarizes the terminology associated with the types of care services that the aforementioned systems provide. Primary care is the domain of the primary care physicians and focuses on prevention, diagnostic, therapeutic, health education, counseling, and minor preventive surgery. Care by specialized physicians—usually referred to by the patient’s primary care physician—is noted as secondary care. Tertiary and quaternary are further specialized care services—referred to by the primary care physician or secondary care specialists.

In closing, medical device manufacturers and pharmaceutical companies are also important elements of the health care ecosystem. The former research, develop and commercialize the medical devices—often technology intensive—that aid in disease diagnosis, therapeutic procedures and monitoring needs. The latter are companies that research, develop and commercialize drugs (i.e., medicine). The medical device and pharmaceutical industries are highly regulated, in the U.S. by the Food and Drug Administration.

Table 1: Terminology associated with the different types of health care services


[1] L. Shi and D. Singh, Essentials of U.S. Health Care Systems, Jones and Bartlett Learning, 5th Edition, 2019.

[2] (Accessed July 28, 2020)

[3] care (Accessed July 28, 2020)

[4] July 28, 2020)

[5] (Accessed July 28, 2020)


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