Account Manager

Non terminated plans that the COBRA participants are currently eligible to enroll in.

Active Plans

The frontline liaison between Client and WageWorks operational departments. Responsible for continued client support and education. Also serves as a conduit to keep management apprised of any improvements or challenges that may impact WageWorks, Inc.

Adverse Selection

The tendency of an individual to recognize his or her health status in selecting the option under a retirement system or insurance plan that tends to be most favorable to him or her (and most costly to the plan). Sometimes referred to as ‘anti-selection’.

Affiliation Period

A period of time that must elapse before health insurance coverage provided by an HMO becomes effective, and during which the HMO is not required to provide benefits.

Age Limit

Stipulated minimum to maximum ages below and above which the company will not accept applications, forms or may not review policies. Usually subject to ADEA (Age Discrimination in Employment Act of 1967) and state laws. The COBRA Qualifying event would be Loss of Dependent Status.

Anticipatory Action

Under COBRA, if an employer (or a covered employee) discontinues coverage for employees, spouses or dependents in anticipation of a qualifying event, such an action will not be considered in determining whether those individuals lost coverage due to the qualifying event.

Applicable Premium

The cost to the plan for the period of the continuation coverage for similarly situated covered beneficiaries who have not had a qualifying event. In its simplest form, for an insured employer, this would be the premium paid to the insurance company for the coverage, regardless of any employee contribution. Under COBRA, required premium payments may not exceed 102% (150% for certain disabled individuals) of the applicable premium.

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Beneficiary

A person designated by a participant or by the terms of an employee benefit plan, which is or may become entitled to a benefit thereunder.

Benefit

Rights of the participant or beneficiary to either cash or services after meeting the eligibility requirements of the pension or other benefit plans.

Benefit Type

A classification of services within a benefit plan consisting of one or more of: medical, dental, vision, and pharmacy.

Benefit Year

The maximum time period during which elections are in effect. Generally, this is a twelve-month period, which coincides with the calendar year. Benefit year is client defined and generally applicable to all plans.

Bundling

Offering benefits such as vision and dental in addition to medical coverage and requiring employees to accept the ‘package’ rather than allowing them to chose one coverage without the other.

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Cafeteria Plan

A benefit program under Section 125 of the Internal Revenue Code that offers employees a choice between permissible taxable benefits, including cash, and nontaxable health and welfare benefits such as life and health insurance, vacation pay, retirement plans and child care.

Calendar Year

A year that ends on December 31.

Carrier

Any commercial insurance company, Blue Cross/Blue Shield plan, or other underwriter that provides insurance protection, such as medical, dental, life, and disability for employer benefit plans.

Carrier Name

The name of the provider that sponsors the client plan.

Civilian Health and Medical
Program of the
United States (CHAMPUS)

Provides health coverage for the families of members of the armed services, including the families of reservists called for active duty.

Claim

A demand to the insurer or an employee benefit plan by the insured person, plan participant or beneficiary, for the payment of certain benefits.

Claim Denial Appeal Procedure

ERISA requires that summary plan descriptions explain the steps that a participant may take if a claim for a welfare or pension benefit is denied partially or wholly. The procedure includes the participant’s right to review the denied claims and the time frame for the plan administrator’s response.

Comprehensive
Open Enrollment

WageWorks will conduct Open Enrollment for the client, which includes: Updating system with new plans and rates. Inputting elections for the participants.

Company

The client.

Continuation Coverage

That coverage which is being made available for continuation.

Continuation Period

The period during which a qualified beneficiary may continue his or her coverage under the employer’s plan.

Continuant or COBRA Continuant

A qualified beneficiary who has elected COBRA coverage.(see Qualified Beneficiary)

COBRA

COBRA is the acronym for the Consolidated Omnibus Budget Reconciliation Act of 1985. COBRA provides that virtually all employers who sponsor group health plans must permit covered individuals who lose coverage under the plan as a result of certain enumerated events to elect to continue their coverage under the plan for a prescribed period of time based on a self-pay basis.

Coupon Billing

A method of billing participants for continuation of coverage in which payment coupons are given at the time of enrollment intended to allow participants to keep track of the premium payments they must make to continue their coverage.

Coverage Class

An employer defined group to which a participant belongs. Examples: salary, hourly, union, non-union.

Coverage Level

The number of individuals enrolled in a plan, within a benefit type, at a group level. Examples of coverage levels are: Beneficiary, Beneficiary + 1, and Family.

Coverage Tier

The Coverage Tier, also referred to as coverage class, is the billing status for the plan, and listed separately for each plan.

Church Plans

Employers operating a church plan as defined by Internal Revenue Code section 414(e) are exempt from all COBRA requirements. A church plan is a plan established and maintained by a church, convention, or association of churches that is tax exempt under the Internal Revenue Code Section 501.

Conversion Privilege

A contractual right of a terminating employee to convert from group coverage to an individual policy without providing evidence of insurability. COBRA stipulates that individuals who have this right must be allowed to convert to individual coverage after the required COBRA continuation period.

Covered Employee

A covered employee is any individual who is or was provided coverage under the employer’s group health plan by virtue of performing services for that employer.

Creditable Coverage

Coverage that is ‘credited’ toward reducing or eliminating a group health plan’s pre-existing condition exclusion period. Coverage under almost any type of medical plan may be considered creditable coverage, including coverage under; group health plans, individual insurance, Medicare, Medicaid, CHAMPUS, Indian Health Service medical care or care through a tribal organization, state health benefits risk pools, the Federal Employees Health Benefits Program, a public plan of a state or local government, and a Peace Corps Plan.

Current

A term used by WageWorks, Inc. in reference to a qualified beneficiary who has elected and paid for COBRA continuation coverage.

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Default Plan

Replacement of the terminated plan with another plan.

Dependent Child

A natural child, adopted child, foster child, stepchild or legal ward of a covered employee or covered individual. The plan document defines who is an eligible dependent child.

Determination Period

The 12-month period during which the premium charged to qualified beneficiaries for continuation coverage must remain constant. The determination period may be set for all qualified beneficiaries as a group, rather than individually.

Domestic-Partner Coverage

Benefit coverage that recognizes as a family the relationship between two unrelated people that is the approximate equivalent of marriage, but does not involve formal marriage.
Benefit plans that recognize domestic partnerships treat the partners of participants as if they were spouses. However, no requirement exists, as a matter of federal law, that a plan must extend COBRA rights to domestic partners who lose coverage due to what would otherwise be qualifying events.

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Election Period

The period during which a qualified beneficiary may elect to receive COBRA continuation coverage. This period must last at least 60 days and begins on the later of the date on which coverage actually terminated or the date the qualified beneficiary was provided with a notice of COBRA rights.

Eligible

The concept of being permitted to enroll in a benefit based upon meeting certain predefined requirements or conditions.

Eligibility

Conditions that must be met to qualify for coverage under a plan, such as length of service, full-time status, or attaining a certain minimum age.

Eligibility, Medicare

A person is generally ‘eligible’ for Medicare due to age when they reach age 65. A person ‘eligible’ for Medicare is not necessarily ‘entitled’ to Medicare. An ‘eligible’ person must actually apply for Social Security benefits before they can become ‘entitled’ to Medicare. For COBRA purposes, merely being ‘eligible’ to enroll in Medicare is not considered as being ‘entitled’ to Medicare.
(see Entitlement, Medicare)

Employee Assistance Plan (EAP)

An employer-maintained program that provides counseling and referral services for the treatment of drug abuse, alcoholism, emotional, mental and physical problems, and financial or legal difficulties that can affect job performance.

Employee Retirement Income Security Act of 1974 (ERISA)

A federal law primarily enacted to enforce pension equality. ERISA subjects the persons engaged in the administration, supervision and management of employee welfare benefit plans to numerous responsibilities.

Employee Welfare Benefit Plan

A plan, fund or program maintained by an employer or employee organization, or both, for the purpose of providing benefits, other than pension benefits, to its participants or their beneficiaries through the purchase of insurance or otherwise.

Employer Plan Code

Employers’ identification code for a particular plan.

Enrollment Date

The first day of coverage under a plan, or if there is a waiting period, the first day of the waiting period.

Entitlement, Medicare

The IRS final regulations of February 1999 specify that a qualified beneficiary becomes ‘entitled’ to Medicare upon the effective date of enrollment in Medicare Part A or Part B, whichever occurs earlier. A person ‘entitled’ to Medicare is more than merely ‘eligible’ for Medicare – they have actually enrolled in Medicare and their otherwise reimbursable claims will be paid by Medicare.

ERISA

See Employee Retirement Income Security Act of 1974

Evidence of Insurability

Proof, provided through a medical examination or through a personal statement, concerning factors regarding a person’s physical condition, medical history, and other information of which an insurer could base an underwriting decision.

Exclusions or Exceptions

Specific conditions or circumstances listed in the policy or employee benefit plan for which the policy or plan will not provide benefit payments.

Exhaustion of COBRA Continuation Coverage

COBRA coverage ends for any reason other than either the failure of the individual to pay premiums on a timely basis or for cause (such as making a fraudulent claim or an intentional misrepresentation of a material fact in connection with the plan).

Existing Plans

Plans that are currently in effect.

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Family and Medical Leave Act (FMLA):

The federal law enacted to provide employees with the right to take an unpaid leave of absence without jeopardizing their jobs or their benefits, including health coverage.

Fiduciary

One who acts in a capacity of trust and who is therefore accountable for whatever actions may be construed by the courts as breaching that trust. Under ERISA, fiduciaries must discharge their duties solely in the interest of the participants and beneficiaries of an employee benefit plan. In addition, a fiduciary must act exclusively for the purpose of providing benefits to participants and beneficiaries in defraying reasonable expenses of the plan.

Flexible Spending Account (FSA)

An account funded by an employee salary reduction, employer contribution, or both, and used to pay the employee’s share of the cost of certain benefits or to reimburse him or her for expenses. It is a device for converting after-tax expenses to pre-tax ones.

Fulltime Student Status

A designation meant to identify a covered dependent of a qualified beneficiary under the specified age that is currently enrolled as a fulltime student.

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Good Faith

Honesty in fact in the conduct or transaction concerned.

Grace Period

A period that follows the due date of the premium after which the policy continues in force.

Group Health Plan

A broad definition under the tax code that includes all types of arrangements for the provision of medical care, such as insured arrangements, on-site facilities and cafeteria plans or flexible-benefit arrangements to an employer’s employees, former employees or their families.

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Health Insurance

Protection that provides payment of benefits for covered sickness or injury. Included under this heading are various types of insurance, such as accident insurance, disability income insurance, medical expense insurance, and accidental death and dismemberment insurance.

Health Maintenance Organization (HMO)

A pre-paid medical group practice plan that provides a comprehensive predetermined medical care benefit package and are usually characterized by very small co-payments for treatment received and low or no deductibles. HMOs are both insurers and providers of health care.

Health Insurance Portability & Accountability Act of 1996 (HIPAA)

A federal law, which limits the use of pre-existing condition exclusions, waiting periods and health status exclusions.
One of HIPAA’s main purposes is to increase an individual's ability to make his or her health insurance ‘portable’ between jobs. The idea was to enable more individuals to be able to change jobs and not experience substantial decreases in their health plan coverage.

I

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Indemnity Plan

Provides benefits in the form of specific, cash payment reimbursement for designated covered services. These payments can be either made to the enrollee or, assigned directly to health providers.

Issuer

An issuer is an insurance company, insurance service, or insurance organization (including an HMO) that is required to be licensed to engage in the business of insurance in a state and that is subject to state law that regulates insurance.

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Late Enrollee

Individual who enrolls in a group health plan later than on:

• The earliest date on which coverage can becomeeffective under the plan; or
• A special enrollment date.

Loss of coverage

When an individual is no longer covered under the same terms and conditions as was in effect immediately before a qualifying event.

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Medicaid

A medical benefits program for low-income persons paid for jointly by the federal government and the applicable state and administered by the applicable state. Medicaid provides medical benefits to persons who meet certain criteria and whose incomes fall below specified maximums.

Medicare

A federal program of medical and hospital benefits, generally for those over age 65. Individuals deemed to be disabled by the Social Security Administration and receiving Social Security Disability Benefits for 24 months, may also become entitled to Medicare, regardless of age.

Milestone Document

A document that defines the timeline for open enrollment deliverables by the client and WageWorks.

Multiple Qualifying Event

An initial qualifying event (e.g. termination of employment or a reduction in hours of employment) is followed by another qualifying event (e.g. divorce, death, loss of dependent status). The occurrence of the second qualifying event may entitle the qualified beneficiaries to an additional 18 months of continuation coverage.

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Newly Acquired Dependents

New dependents who, during the COBRA coverage period, are added onto the plan by qualified beneficiaries. These individuals are generally not considered qualified beneficiaries. However, HIPAA expanded the definition of a qualified beneficiary to include a child born to or adopted by the covered employee during a period of COBRA continuation.

Non Contributory

Benefits programs in which the employer pays the entire cost of premiums.

Non-Core Benefits

Coverage for dental and vision benefits. These types of coverage are usually provided in plans that are separate from medical benefits (core coverage).

Non-resident alien

Individual who is not a U.S. citizen and is not a permanent or temporary resident of this country. The right to elect COBRA coverage does not have to be given to these individuals if they receive no U.S. source of income.

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Open Enrollment

Is the annual period when employees, retirees and COBRA participants are given the option of adding, deleting or modifying health care coverage. It allows employees, retirees or COBRA participants the opportunity to make changes to their current benefit elections without having to experience a change in family status.

Open Enrollment Begin Date

The date the actual open enrollment period starts for participants or employees to begin making their coverage selections.

Open Enrollment Confirms

A document sent to the participant or employee validating the open enrollment selection made by the participant or employee.

Open Enrollment End Date

The date the actual open enrollment period ends for participants or employees to begin making their coverage selections.

Open Enrollment Period

A period during which active employees and qualified beneficiaries are permitted to change certain elements in their insurance coverage and / or other benefits.

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Passive Enrollment

The enrollment activity that does not require each potential enrollee to respond. If the potential enrollee does not respond, a decision is made for them (default coverage as defined by the employer).

Plan

The package of services in which eligible individuals may elect coverage.

Plan Name

A descriptive name given to a particular plan to ease the identification of the plan. For example: CIGNA Dental for Washington DC.

Plan Status

An indicator denoting whether the plan is currently active or inactive.

Plan Rate 100%

The true plan rate. This rate does not include the legally allowed 2% administrative fee.

Plan Termination Date

The date the plan ceases to exist and benefits are settled.

Plan Type

A classification of plans delivering services. Examples include: HMO, PPO, and indemnity.

Point-of-Service Plan

Members do not have to choose how to receive services until services are needed. In some plans, for example, members decide whether to use a PPO or an outside provider. Although the services of an outside provider are covered, benefits are greater if members select a preferred provider (70% vs. 100% coverage).

Positive Enrollment

The enrollment activity that requires each potential enrollee to respond even if their response is to continue existing coverage.

Preferred Provider Organization (PPO)

A group of hospitals or physicians that contract on a fee-for-service basis with employers, insurance plans or third party administrators to provide health care.

Premium Distribution

The premium payment to the employer (or your designee if mutually agreed) will consist of a check in the amount of the total premiums collected, not including the 2% COBRA administrative fee that WageWorks COBRA Services will retain.

Primary Contact

The individual designated as the principle contact for a client.

Provider

A physician, other health professional, hospital, or other entity that provides health care services.

Q

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Qualifying Event

A qualifying event is an event which would cause an employee, former employee, covered spouse, and/or covered dependent child to lose coverage under the employer’s group health plan due to the following reasons:

• The covered employee’s termination of employment
• The covered employee’s reduction of work hours
• Divorce from the covered employee
• A dependent child ceases to be eligible under thegroup health plan
• Death of the covered employee
• The covered employee becomes entitled to Medicare

Qualified Beneficiary

A qualified beneficiary is any individual (employee, spouse, or child) that was covered under the group healthcare plan immediately prior to the qualifying event. HIPAA expanded this definition to include a child born to or placed for adoption with the covered employee during the period of COBRA coverage.

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Rate Start Date

The date the plan rate becomes effective.

Rate Structure

The various values of a rate dependent upon various parameters such as Coverage Class, Coverage Level, etc.

Retroactive Coverage

Once a qualified beneficiary has elected COBRA coverage, coverage must be provided from the date on which coverage was lost, not from the date on which the election was made.

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Self-Funded or Self-Insured Plan

An arrangement under which some or all of the risk associated with providing benefits is not covered by an insurance contract. Rather, the plan sponsor establishes the necessary reserves to assure payment of claims.

Service Area

The geographic areas serviced by health plan as approved by state regulatory agencies and / or as detailed in the certification of authority.

Services

The specific items, processes, or functionality offered to a client.

Significant Break in Coverage

A significant break in coverage refers to a break in coverage of 63 days or more. Under HIPAA, if an individual has a break in coverage of at least 63 days, any creditable coverage before that break can be disregarded by a plan evaluating whether to impose a pre-existing condition limitation period.(see Creditable Coverage)

Similarly Situated Individual

An individual defined by the plan as being similarly situated and for whom no qualifying event has occurred.

Social Security (SS)

A federal program of old age and related benefits covering most workers and their dependents.

Solicitation Letter

A document that describes and offers to a client WageWorks Open Enrollment services.

Summary Plan Description (SPD)

A brief, clear description of provisions in an employee benefit plan that is distributed to employees whenever the plan is adopted or amended.

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WageWorks Plan ID

The identification number assigned to a client's plan.

Waiting Period

The period between employment or enrollment in a program and the date when an insured person becomes eligible for benefits.