Module 4 Regulatory Issues for Health Benefits Flashcards
Health and Welfare Benefits Terms:
Define Co-insurance
The amount expressed at a percentage that is shared between the participant
and the insurance company once any deductible has been met.
Health and Welfare Benefits Terms:
Define Co-Pay
A standard, flat dollar amount paid for the participant for specified services.
Health and Welfare Benefits Terms:
Primary Care PHysician
A medical doctor who practices/is specialized in internal medicine,
family practitioner, general practitioner, pediatrician.
Health and Welfare Benefits Terms:
Preventive Care
Proactive, comprehensive care that emphasizes prevention and early
detection. It includes physical exams, immunizations and well-woman and well-man exams.
Health and Welfare Benefits Terms:
Annual Deductible
The amount plan participants must pay toward a health claims for services
rendered before the insurance company makes any payment.
Health and Welfare Benefits Terms:
Fully-insured plan
Organization pays premiums to an
insurance company where risk is pooled.
Health and Welfare Benefits Terms:
Self Insured Plan
Organization bears the risk and pays
claims and administration fees directly out of general assets.
Health and Welfare Benefits Terms:
Qualifying Life Event
A change in status as dictated by the IRS that allows you make a changes to your pretax benefits elections during the tax year. These events include:
* Marriage or divorce
* Death
* Birth or adoption of a dependent
* Change in employment status
* Dependent no longer eligible due to age
* Loss or significant change in current coverage
* Judgment, decree or court order
* Enrollment in or loss of Medicare or Medicaid
* Ceasing to be enrolled in Children’s Health Insurance Program
Health and Welfare Benefits Terms:
Pre-existing conditions
Plan limitation or exclusion for a
physical or mental condition of a newly insured individual that was present before joining the plan. Under the Affordable Care
Act, plans and insurers can no longer deny medical coverage due to such conditions.
Health and Welfare Benefits Terms:
Grandfathered Plan
Existing plan that is exempt from certain
new legislation, restrictions, or requirements.
Health and Welfare Benefits Terms:
Annual Limits
Annual maximum amount of out-of-pocket
expenses or number of visits and/or services for a particular treatment for each covered plan participant. Under the Affordable Care Act, annual limits can no longer be applied for what are deemed as “essential health benefits” under the law.
Health and Welfare Benefits Terms:
Lifetime Limits
Maximum dollar amount or maximum number of visits and/or services that a plan will pay for over the covered participant’s lifetime. Under the Affordable Care Act,
lifetime limits can no longer be applied for most medical plans.
Health and Welfare Benefits Terms:
Define HDHP (High Deductible Health Plan
health insurance plan with a higher deductible (as indexed by the IRS to be a qualified HDHP) than a co-pay health plan. Participant pays the full, network-discounted cost of covered medical expenses to the deductible maximum before the co-insurance begins. A HDHP
does not allow for co-pay for services, except for prescription benefits after the deductible has been met.
Health and Welfare Benefits Terms:
Define: HSA (Health Savings Account)
A tax-advantage savings account you establish exclusively for the purpose of paying for your qualified health expenses. Account belongs to the participant, funds remain even after termination, and account
balance can be rolled over from one employer to another.
Has triple tax advantages:
1. Contributions are pretax.
2. Distributions for qualified health expenses are not taxable.
3. Interest-bearing account is not taxable.
A HSA can only be offered in combination with a qualified High
Deductible Health Plan.
What is a Health Maintenance Organization (HMO)?
prepaid group medical service organization that emphasizes preventive health care
What is a preferred provider organization (PPO).
A network of health care providers (e.g., hospitals, physicians, dentists, etc.) that offers volume discounts to employers sponsoring group health benefits plans; most common plan today
Define Consumer Driven Health Plan (CDHP)
A plan that attempts to contain medical benefits costs by empowering consumers to make informed choices regarding the quality and efficiency of their health care;
usually involves some form of health care account
Define a Health Reimbursement Arrangement (HRA)
A tax-free health care reimbursement arrangement that must be associated with a high deductible health plan. Employees use the funds in the account for general health care expenses prior to utilizing traditional health care coverage.
Define Health Savings Account (HSA)
A tax-advantaged trust or custodial account that must be associated with a high deductible health plan
What are the 2 types of Welfare Plans?
Disability Plans
- Sick Leave
- Short Term Disability (usually 6 months)
- Long Term Disability (usually coordinated after STD is exhausted)
Life Insurance
What entities are covered under COBRA
COBRA applies to group health plans for employers with 20 or more employees on more than 50% of its typical business days in the prior year. Both full-time and part-time employees are counted to determine whether the plan is subject to COBRA.
* A qualified beneficiary generally is an individual covered by a group health plan on the day before a qualifying event. The individual is either the employee, the employee’s spouse, or an employee’s dependent child. In some cases, retired employees, their spouse and dependent
children may be qualified beneficiaries.
What components of the employers health plan does COBRA cover?
Medical, Dental, vision, drugs, and Healthcare Reimbursement Accounts
Under COBRA what are considered qualifying events
Qualifying events are certain events that would cause an individual to lose
health coverage (e.g., termination of employment, divorce, death, reduction in hours, loss of coverage due to the end of student status*, or attainment of maximum age).
Define the notification procedures under COBRA
– Employers must provide an employee with the initial notification of their COBRA rights within 90 days of the employee becoming covered under the employer’s group health plan. In the case of a covered spouse, they must also receive this
notification. The purpose of this notice is to provide a general overview of COBRA rights and responsibilities. While a single notice may be sent to the employee and spouse if they live at the same address, the regulations provide that the notice
must identify the spouse either by name or by relationship. As an example, the notice would be addressed to “Jane and William Jones” or “Jane Jones and Spouse.”
– A qualified beneficiary must notify the plan administrator of some qualifying events within 60 days.
– Employers must notify plan administrators of some qualifying events within 30 days.
– Plan administrators must provide an election notice, either in person or by first-class mail, within 14 days of learning a qualifying event occurred.
