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Glossary of Benefit Terms

Approved Benefit (AB)
A term used by insurance carriers (like reasonable and customary) which represents the amount of benefit allowed to be paid by the carrier for a procedure or service.

COBRA
COBRA is the abbreviated term for the Consolidated Omnibus Reconciliation Act. COBRA requires employers to provide continuation of coverage to terminating employees or eligible dependents losing coverage up to a minimum of 18 months. Other terms of coverage also apply. Employers may charge up to 102 percent of the premium.

Co-Insurance
Your share of medical expenses normally after you have paid your deductible.

Coordination of Benefits (COB)
COB applies if you or a family member is covered under another medical plan in addition to the coverage you have through AACPS. The benefits payable under you AACPS-sponsored coverage are coordinated with the other plan so that your total benefits from both plans will not exceed 100 percent of the benefit.

Co-Payment
Your out-of-pocket payment when you visit your physician or other healthcare provider (i.e. a $5 co-payment applies to Aetna HMO).        

Covered Expenses
Routine medical care and specific medical expenses incurred as a result of a non-occupational illness, injury or disease which are benefits provided by your health plan.

Deductible
The amount of medical expenses that must be paid in full each calendar year before benefits are usually paid from the plan.

Eligible Expenses
Allowable expenses for necessary medical care, which are determined by the healthcare plan in which you participate. Reasonable and customary guidelines may apply (see definition of reasonable & customary).

Flexible Spending Accounts (FSA’s)
FSA’s provide employees with the opportunity to save money on a pre-tax basis and reduce their taxable income up to permitted IRS limits to save for related expenses. AACPS provides a Dependent Care Account and Healthcare Spending Account option to employees. Careful planning is required for funding the FSA because there is a use or lose concept if funds are not requested by the annual deadline.

Guaranteed Issue
A term associated with applying for coverage with no evidence of insurability required up to certain limits (i.e., long-term care or supplemental life insurance benefits).

Health Care Provider
A doctor, hospital, laboratory, nurse, or anyone who delivers medical or health related care. This is not to be confused with Primary Care Provider.

Health Insurance Portability & Accountability Act (HIPAA)
Healthcare legislation passed to ensure confidentiality of plan members and to ensure safeguards for transmitting healthcare information in a confidential and secure fashion.

Health Maintenance Organization (HMO)
HMO’s provide health care services for a fixed fee and a low co-payment for services. You are covered only for treatment approved by the HMO and you must use HMO physicians and facilities (refer to page 13).

In-Network
Benefits are maximized when you use in-network providers (i.e. CareFirst PPN or UCCI POS). In-Network providers have agreements with health insurance companies to accept the health insurance companies payment for services rendered along with your co-payment.

Lifestyle Change
Normally involves the addition or loss of a dependent family member or a change in your or your spouse’s employment or healthcare coverage. You have 31 days to notify the HR Payroll/Benefits to change your benefits (refer to page 5).

Maintenance Medications
Maintenance medications are considered medications as defined by the prescription drug plan which are usually utilized over a long-term. In this program’s case, if a medication is taken typically over 90 days it is considered a maintenance medication. Examples include blood pressure medication, diabetic products, and birth control pills. Maintenance medications must be ordered through the mail-order plan with CAREMARK
.

Managed Care
Managed care is a concept that permits healthcare plans and employers to administer healthcare plans in a more efficient and cost effective manner. Examples of managed care include networks of providers, pre-certification, preventive care, and health education programs (refer to page 6).

Out-of-Network
Some plans such as the CareFirst PPN and UCCI allow you additional flexibility to seek care outside of your network and still provide coverage but at reduced benefits. Coverage includes satisfying a deductible and then co-insurance where you pay usually 20 percent or 30 percent of the service. Claims forms must be submitted to the carriers for out-of-network visits.

Point of Service (POS)
POS is a category of healthcare plans in which carriers negotiate agreements with a network of participating physicians to provide healthcare at a reasonable co-payment to participants.

Preferred Provider Network (PPN)
A PPN healthcare plan is provided by an insurance carrier whereby the insurance carrier has negotiated agreements with a network of participating providers to accept the carrier’s payment for services rendered and provide a reasonable co-payment to participants. A PPN does not require participants to select a physician and they may seek care from specialists on their own. Most PPN’s provide benefits in and out-of-network (refer to page 11).

Premium
A charge applied either to an employer and/or participant that represents the costs of healthcare.

Primary Care Provider (PCP)
An old fashioned family doctor called by a new name. A general physician, pediatrician, and gynecologist can qualify depending on your healthcare plan. You must specify a PCP if you select an HMO or POS plan.

Referral
If your primary care physician determines that you have a condition that requires the attention of a specialist, a written referral will be provided for you to see a specialist.

Reasonable & Customary
A charge that is determined by the insurance carrier to be considered a reasonable or fair charge for services rendered and the maximum amount the carrier will pay for the services.

Traditional Plan
A Traditional Plan is a type of healthcare plan that is provided by an insurance carrier which provides benefits subject to a deductible and co-insurance and reasonable and customary charges. Participants may see any provider they wish with this type of program. Premiums are generally more expensive due to lack of managed care components.