Key Benefit Terms

Annual Deductible – The amount you must pay each year before the Plan begins to pay for covered healthcare expenses you use. With an aggregate family deductible, the Plan doesn’t begin paying for the healthcare expenses of anyone in the family until the entire family deductible has been met.

Aggregate Deductible – The Plan doesn’t begin paying benefits until the entire family deductible has been met. Once the entirety of the family deductible has been met, by one family member or a combination of family members, then the cost sharing begins.

Appeal – Notifying an insurer of your disagreement with how they have/will cover your claim. An appeal most typically involves denials and payments after a procedure is complete, but an appeal can also be made during a pre-certification for a procedure or prescription. Insurers have an internal procedure to conduct an appeals process. You have the right to be informed of that process.

COBRA (Consolidated Omnibus Budget Reconciliation Act) – Federal law that requires continuation coverage to be offered to covered employees and dependents when group coverage is lost due to certain events. You pay 100% of the premiums including the employer share, plus a small administrative fee. The plans that may be continued under COBRA are medical, dental, vision, General Purpose FSA, Limited Purpose FSA, and the Employee Assistance Program (EAP).

Coinsurance – The percentage of eligible health care expenses the Plan pays after you meet any required annual deductible. You are responsible for paying the remaining difference.

Copayments (Copay) – The fixed dollar amount you pay for certain services.

EAP – Employee Assistance Program

Evidence of Insurability (EOI) – An application process where you provide information on the condition of your health or your dependent’s health in order to be considered for life insurance coverage.

HMO (Health Maintenance Organization) – A health insurance plan that limits coverage to care from doctors who work for or contract with the HMO. The plan generally will not cover out-of-network care except in an emergency. An HMO usually requires you to live or work within its service area to be eligible for coverage.

Family Coverage – Regarding your deductible, family coverage is defined as employee + one or more dependents (e.g. employee + spouse/domestic partner, employee + child(ren), employee + family).

Flexible Spending Account (FSA) – An arrangement through your employer that allows you to pay for many out-of-pocket health expenses with tax free dollars for the calendar year. You could forfeit unused dollars if expenses are not incurred during the calendar year.

Formulary – A list of prescription medications, usually brand-name, that an insurer will allow you to access. These medications are usually not as inexpensive as generic but will cost less than non-formulary medications.

Guaranteed Issue (GI)Life insurance coverage that is guaranteed to be issued to applicants regardless of health status. Evidence of insurability (EOI) is not required.

Health Savings Account (HSA) – A savings account used in conjunction with a high deductible health insurance policy that allows users to save money tax-free against medical expenses. HSA’s can be used for out-of-pocket medical, dental, and vision expenses. HSA funds roll over and accumulate year to year if they are not spent and are yours to keep even if you leave your employer.

High Deductible Health Plan (HDHP) – A type of health plan with a deductible larger than what’s found in a traditional health plan. HDHP’s typically access the same PPO network as a traditional plan. In order to make contributions to an HSA, the IRS requires election into a plan with a deductible larger enough to meet the minimum deductible and out-of-pocket requirements.

In-Network Provider – A provider who contracts with a health care plan to offer certain services at a discounted rate.

LTD – Long Term Disability

Non-Preferred Medications – Drugs that are not on the Plan’s preferred formulary list. These medications typically cost more, and you may be subject to pay the full cost without the cost being applied to the plan deductible or out-of-pocket maximum, unless you receive prior authorization approval from your physician and pharmacy.

Out-of-Network Provider – A provider who does not have a contract with the health plan and can charge you over and above what is considered reasonable and customary.

Out-of-Pocket Maximum (OOPM) – The most you will pay out of your pocket in a year before the Plan begins paying 100% of eligible expenses including prescription drugs.

Premium Contributions – The amount deducted from your pay for the cost of benefits coverage. The amount deducted is based on which benefit plan and coverage level (employee only, employee + family, etc.) you elect. The amount is deducted on a semi-monthly basis (24 times a year).

PCP – Primary Care Physician

Preferred Provider Organization (PPO) – A managed care organization of medical doctors, hospitals, and other health care providers who have agreed with an insurer to provide health care at reduced rates to the insurer’s clients. You generally do not need a referral from a primary care physician to see a specialist and some coverage is available for out-of-network care.

Preventive Care – Measures taken for disease prevention, as compared to a diagnosis or disease treatment. In most cases, in-network preventive care (e.g. screenings, immunizations, preventive medications) are covered at 100%.

Qualified Life Event (QLE) – A qualified life event may allow you to make changes to your existing benefit elections, consistent with the event. A qualified life event may include marriage or newly eligible domestic partner, divorce or legal separation, birth or adoption, death of a dependent, you or your spouse/domestic partner losing or gaining other coverage.

Run-Out Period – A period of time in the new plan year during which FSA participants can file claims for expenses incurred during the previous plan year.

Specialty Drugs – High-cost prescription medications used to treat complex, chronic conditions.

STD – Short Term Disability

Step Therapy – A process where an insurer requires a member try certain medications before agreeing to cover a medication that the member’s physician is trying to prescribe.

Usual, Customary and Reasonable (UCR) – The amount paid for a medical service in a geographic area based on what providers in that area usually charge for the same or similar medical service. The UCR amount is used to determine the allowed amount.

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