Chapter 12 - Managing Employee Benefits Flashcards
Define “Gross-Up”.
-To increase the net amount of what the employee receives to include the taxes owed on the amount.
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Define “Flexible Benefits Plan”.
-Program that allows employees to select the benefits they prefer from options established by the employer.
Page 418
Define “Adverse Selection”.
-Situation in which only higher-risk employees select and use certain benefits.
Page 419
Define “Open Enrollment”.
-A time when employees can change their participation levels in various benefit plans and switch between benefit options.
Page 420
Define “TPAs”.
-Third-party administrators
-Vendors that provide enrollment, record-keeping, and other administrative services to organizations.
Page 420
Define “Workers’ Compensation”.
-Security benefits provided to workers who are injured on the job.
Page 423
Define “No-Fault Insurance”.
-An injured worker receives benefits even if the accident was the employees’ fault.
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Define “Exclusive Remedy”.
-Workers’ compensation benefits are the only benefits injured workers may receive from the employer to compensate for work-related injuries.
Page 425
Define “Three-Legged Stool”.
-A model showing the 3 sources of income to fund an employee’s retirement.
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Define “Vesting”.
-A benefit that cannot be taken away.
Page 426
Define “Portability”.
-A retirement plan feature that allows employees to move their retirement benefits from one employer to another.
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Define “Retirement Plan”.
-A program established and funded by the employer and/or employees to fund employees’ retirement years.
Page 427
Define “Defined Benefit Plan”.
-Retirement program in which employees are promised a pension amount based on age and years of service.
Page 427
Define “Defined Contribution Plan”.
-Retirement program in which the employer and/or employee makes an annual payment to an employee’s retirement account.
Page 427
Define “401(k) Plan”.
-Plan allows for a percentage of an employee’s pay to be withheld and invested in a tax-deferred account.
Page 428
Define “Auto-Enrollment”.
-Process by which employee contributions to a 401(k) plan are started automatically when an employee is eligible to join the plan.
Page 428
Define “Auto-Escalation”.
-Automatic increases of 1 percent a year to a 401(k) plan.
Page 428
Define “Deductible”.
-Money paid by an insured individual before a health plan pays for medical expenses.
Page 432
Define “Health Spending Account”.
-A tax-favored savings plan to provide funds for paying medical expenses.
Page 433
Define “Consumer-Driven Health (CDH) Plan”.
-Health plan that provides employer financial contributions to employees to help cover their health-related expenses.
Page 433
Define “Copayments”.
-The portion of medical expenses paid by an insured individual for medical treatment.
Page 433
Define “Managed Care”.
-Approaches that monitor and reduce medical costs through restrictions and market system alternatives.
Page 433
Define “Well-Being”.
-The overall level of employee physical, mental, financial, and social wellness.
Page 434
Define “Qualifying Event”.
-An event that causes a plan participant to lose group health benefits”.
Page 434
Define “Stock Purchase Plan”.
-Plans where employees may buy shares in the company at a discount, or the company pays the brokerage fees.
Page 437
Define “Serious Health Condition”.
-An illness or injury that requires inpatient care or continuing treatment by a health care provider for medical problems that exist beyond three days.
Page 439
Define “Paid-Time-Off”.
-Plans that combine all sick leave, vacation time, and holidays into a total number of hours or days that employees can take off with pay.
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