Human Resources and Benefits

Health Insurance Acronym Reference Guide

healthcare program

Health insurance is a complex topic, but all of the acronyms and abbreviations make the subject even more difficult. Whether you’re trying to understand the latest developments in health care reform law or trying to make sense of your own health plan documents, you are likely to run into many of these acronyms. We know that not everyone can become an expert on health insurance or health care law, but everybody can understand the issues much better with this helpful reference.

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ACA The Patient Protection and Affordable Care Act (also Affordable Care Act or Obamacare) (2010) is most significant change to the U.S. health care system since the passage of Medicare and Medicaid in 1965. The goal of the ACA was to increase the quality and affordability of health insurance, lower the uninsured rate through both private and public coverage, and reduce the overall cost of health care.
ADA The Americans with Disabilities Act (1990) prohibits discrimination against people with disabilities in the areas of employment, public accommodation, transportation, communications, and government services. It also establishes equitable requirements for telecommunications services for those requiring assistive devices and technology.
ADEA The Age Discrimination in Employment Act (1967) prohibits wage, hiring, advancement, and other employment discrimination by employers and labor organizations against persons 40 years of age or older.
ALE An Applicable Large Employer, as defined within the ACA, is any company or organization that employs an average of 50 or more large employees or full-time equivalents (FTEs), who work 30 or more hours each week. Under the ACA, ALEs must offer health insurance to their employees or face a penalty.
CFR The Code of Federal Regulations, published annually, contains the general and permanent rules published in the Federal Register by the various departments and agencies of the U.S. federal government.
CHIP Children's Health Insurance Program. See SCHIP, State Children's Health Insurance Program.
CMS The Centers for Medicare & Medicaid Services is a federal agency that administers Medicare and regulates state stewardship of Medicaid and State Children’s Health Insurance Program (SCHIP) activities. (Formerly known as the Health Care Financing Administration, or HCFA.)
COBRA The Consolidated Omnibus Budget Reconciliation Act (1985) establishes the right of workers who lose their employer-provided health benefits to choose to continue them under certain circumstances. A covered loss of benefits could be triggered by job loss, reduction in hours worked, transition between jobs, death, divorce, and other life events.
CRA The Civil Rights Act (1964) outlawed discrimination based on race, color, religion, sex, or national origin, effectively ending segregation in schools, workplaces and other public accommodations.
CRC The Civil Rights Center, part of the U.S. Department of Labor (DOL), develops, administers, and enforces policies and procedures relating to Title VI and Title VII of the Civil Rights Act (CRA).
DHHS The U.S. Department of Health and Human Services was established to help protect the health of Americans and provide essential human services—especially for at-risk populations. The DHHS takes up almost a quarter of the federal budget and administers more grant dollars than all other federal agencies combined.
DOL The U.S. Department of Labor is a cabinet-level department of the federal government responsible for wage and work hour standards, workplace safety, and unemployment insurance benefits. It includes the Bureau of Labor Statistics, which tracks and manages such metrics as the Consumer Price Index, employment/unemployment numbers, and workplace injury figures.
DOT The U.S. Department of the Treasury is an executive agency of the federal government responsible for managing U.S. economic and financial systems. As stewards of the public treasury, the DOT is responsible for both collecting and disbursing taxpayer funds. (Not that another agency, the U.S. Department of Transportation, shares the same acronym.)
EAP An Employee Assistance Program is an employee benefit that makes counselling and other services available to employees to help them work through personal and family problems that could potentially affect the performance of job duties.
EBSA The Employee Benefits Security Administration, part of the U.S. Department of Labor (DOL), administers, regulates and enforces the provisions of Title I of the Employee Retirement Income Security Act of 1974 (ERISA). (Formerly known as the Pension and Welfare Benefits Program, or PWBA.)
EDI Electronic Data Interchange generally refers to a specific rule within the Health Insurance Portability & Accountability Act (HIPAA>) that defines a set of data transmission specifications to govern the way sensitive health data is electronically transferred between computer systems.
EEOC The Equal Employment Opportunity Commission is a federal law enforcement agency that investigates claims of discrimination based on an individual’s race, color, national origin, religion, sex, age, disability, genetic information (or retaliation for complaining about a violation) in order to enforce laws against workplace discrimination.
EGTRRA The Economic Growth and Tax Relief Reconciliation Act (2001) amended many sections of the Internal Revenue Code (IRC), including income tax rates, estate and gift tax exclusions, and qualified and retirement plan rules. Often referred to as one of the two “Bush tax cuts,” the provisions of EGTRRA were renewed by Congress in 2010.
EIC See EITC, Earned Income Tax Credit.
EITC An Earned Income Tax Credit is a federal tax subsidy for working individuals and families to reward and encourage work and offset federal payroll and income taxes.
EO Equal Opportunity is a concept and official government policy aimed at reducing and eliminating discrimination and promoting the employment/business prospects of minorities and traditionally under-served populations.
EOB An Explanation of Benefits is a statement produced by an insurance company to a health plan participant to itemize specific medical services that were provided and explain the amount that was paid on the participant’s behalf.
EOI Evidence of Insurability, sometimes called “fitness to receive insurance,” is often required by insurers before issuing a long-term disability or life insurance policy. Generally produced after an extensive medical exam, EOI indicates that a potential insured does not represent a specific risk to an insurer.
EPO An Exclusive Provider Organization is a health plan that combines some features of an HMO and a PPO. As indicated by the word “exclusive,” EPOs don’t generally cover care provided outside the network. Like PPOs, they may not require a primary care physician’s referral to see a specialist.
ERISA The Employee Retirement Income Security Act (1974) provides minimum standards for employee pension plans and establishes extensive regulations regarding the tax impact of transactions related to employee benefit plans.
FFE A Federally Facilitated Exchange is a health insurance marketplace for expanding health care coverage under the ACA. All marketplace functions with FFEs are performed by DHHS, through the federal government’s Healthcare.gov portal. FFEs contrast with state-based marketplaces, state-partnership marketplaces and federally supported marketplaces.
FICA The Federal Insurance Contribution Act (1935) established a tax paid by workers and their employers to fund Social Security and Medicare. Originally instituted as part of the New Deal, FICA was expanded in the 1960s.
FMLA The Family and Medical Leave Act (1993) provides the option for covered workers to take unpaid, job-protected leave (with continuation of group health insurance coverage) for family and medical reasons including the birth or adoption of a child, a serious health condition in the worker’s family, and a qualifying exigency related to an active-duty service member in the worker’s immediate family. The program is administered by the Wage and Hour Division of the U.S. Department of Labor (DOL).
FSA A Flexible Spending Arrangement (also Flexible Spending Account), allows workers to contribute pre-tax dollars to a personal fund to be used for qualifying medical and/or dependent care expenses.
FTE A Full-Time Equivalent is a ratio of employees to hours worked, used to calculate how many virtual “employees” an organization has for the purposes of federal health care regulations. For examples, if a company has four part-time employees who work 25 hours per week, the total employee output is 100 hours per week, or 2.5 FTEs (based on a 40-hour work week).
FUTA The Federal Unemployment Tax Act (1939) is a benefit paid to workers who have lost their jobs, passed by Congress in the wake of the Great Depression. In most states, there is both a state and federal tax that employers must pay for each worker on the payroll.
GINA The Genetic Information Nondiscrimination Act (2008) is a federal statute that makes it illegal for companies to discriminate in employment or the provision of health benefits on the basis of genetic information, or on a proven or perceived genetic predisposition to develop a particular disease or condition.
GLBA The Gramm-Leach-Bliley Act (1999) sought to modernize financial services by requiring businesses such as banks, finance companies, investment advisors and insurance companies to safeguard private consumer information. The law served as a partial repeal of the Glass-Steagall Act (1933), which place strict controls on specific types of corporate mergers.
HCE Highly Compensated Employee designation can go to a someone who has at least a five-percent ownership in a company, who receives a salary above a specific amount ($120,000 in 2015), or whose salary is in the top 20 percent for a particular company. According to IRS rules, benefits administrators have to be able to prove to regulators that HCEs and NHCEs are treated the same way.
HCFA Health Care Financing Administration. This agency has been renamed. See CMS, Centers for Medicare & Medicaid Services.
HCTC A Health Coverage Tax Credit is an IRS tax credit for health insurance premiums that helped pay for health care for qualified recipients between 2002 and 2013. Since the legislation that provided HCTC expired in 2013, it is no longer available as a credit.
HFSA A Health Flexible Spending Arrangement (also Health Flexible Spending Account) puts pre-tax dollars to a personal fund to be used for medical expenses. See also FSA, Flexible Spending Arrangement.
HHS Health and Human Services. See DHHS, U.S. Department of Health and Human Services.
HIPPA The Health Insurance Portability & Accountability Act (1996) made two major changes in health insurance/health care law. First, it protected the health insurance coverage of employees (and their families) after a job change or loss. Second, it created national standards for the electronic transfer and exchange of health information. HIPPA also sought to eliminate fraud and waste from health insurance and health care, and to promote health savings accounts as a way to pay for health care.
HIT Health Information Technology (also Health IT) refers to the exchange of patient and other health information through electronic means. This field has become increasingly important as health insurance companies and care providers have turned to technology to lower costs and improve outcomes—while at the same time endeavoring to stay in compliance with HIPAA privacy requirements.
HMO A Health Maintenance Organization is a health insurance plan that restricts health coverage to doctors and other providers who are employed or contracted by the HMO. Generally, out-of-network care is only available on an emergency basis.
HMOA The Health Maintenance Organization Act (1973) is a federal law that required companies with at least 25 workers to offer a federally certified HMO option in addition to traditional healthcare plans. It was amended several times, most recently by in 1996 by the Health Insurance Portability and Accountability Act (HIPAA).
HRA A Health Reimbursement Arrangement (also Health Reimbursement Account) allows an employer to contribute to an employee’s personal account in order to provide reimbursement for eligible medical expenses. Unlike similar plans, an HRA is funded by the employer and not by salary deductions.
IRC The Internal Revenue Code (1986) is the section of federal law that governs the collection of income, payroll, estate, gift and excise taxes.
IRS The Internal Revenue Service was established in 1862, though the agency’s current name dates back to 1918. It is the bureau of the U.S. Department of the Treasury (DOT) responsible for collecting taxes and administering the Internal Revenue Code (IRC).
JGTRRA The Jobs and Growth Tax Relief Reconciliation Act (2003) was a package of tax cuts that lowered individual tax rates as well as the rates on capital gains, dividends and estates. Considered one of the “Bush tax cuts,” the goal of the legislation was to counter the post-9/11 recession. Though the cuts were originally set to expire, they have been extended several times.
LTD Plan A Long-Term Disability Plan (also Long-Term Disability Income Plan) is a type of insurance policy that pays a benefit if an employee has a covered illness or injury that prevents that person from earning an income.
MHPA The Mental Health Parity Act (1996) mandated that the limits of mental health benefits in a group health plan be on par with limits for medical and surgical benefits. This legislation was enhanced and replaced by the Mental Health Parity and Addiction Equity Act (MHPAEA).
MHPAEA The Mental Health Parity and Addiction Equity Act (2008) built on the Mental Health Parity Act (MHPA) by extending coverage requirements to mental health/substance use disorders. The requirements were substantially expanded with the passage of the Patient Protection and Affordable Care Act (ACA).
MSA A Medical Savings Account (also known as an Archer MSA) was a tax-deferred savings account often offered as part of a group benefits package designed to enable participants to pay for health-related expenses within a high-deductible medical insurance plan. MSAs have been replaced by Health Savings Accounts (HSAs), which were introduced in 2003.
NAIC The National Association of Insurance Commissioners is the standards and regulatory agency in the U.S. created and governed by the chief insurance regulators from U.S. states, territories, and the District of Columbia.
NHCE A Non-Highly Compensated Employee is a worker who doesn’t fit the definition of a Highly Compensated Employee (HCE) for the purpose of IRS regulation. According to IRS rules, benefits administrators have to be able to prove to regulators that HCEs and NHCEs are treated the same way.
NMHPA The Newborns’ and Mothers’ Health Protection Act (1996) requires health insurance plans that offer maternity coverage to pay for at least a 48-hour hospital stay (96-hours, in the case of a cesarean section) following the birth of a child.
OCR The Office for Civil Rights is an agency within the U.S. Department of Health and Human Services (DHHS) charged with preventing discrimination in health care and social service programs. (Note that there is also an Office for Civil Rights within the U.S. Department of Education.)
OFCCP The Office of Federal Contract Compliance Programs is a bureau within the U.S. Department of Labor (DOL) that enforces affirmative action and equal employment opportunity provisions of federal law for companies that do business with the federal government.
OHCA An Organized Health Care Arrangement allows two or more companies or entities to share Protected Health Information (PHI) about patients in accordance with HIPAA privacy regulations. The most common type of OHCA involves the sharing of information between a physician and a hospital where the physician has medical privileges.
OMB The Office of Management and Budget is the bureau within the Executive Office of the President of the U.S. responsible for preparing the president’s budget proposals. In addition, the OMB evaluates other executive branch policies and procedures to determine whether they are in compliance with the president’s goals and policies.
PDA The Pregnancy Discrimination Act (1978) established that discrimination on the basis of pregnancy, childbirth, or related medical conditions is considered unlawful sex discrimination under Title VII of the Civil Rights Act (CRA).
PEO A Professional Employer Organization is a company that provides human resources, employee benefits, payroll and workers compensation services to client businesses on an outsourced basis.
PHI Protected Health Information is personally identifiable health information is protected by HIPAA privacy and security rules. When PHI data is maintained or transmitted in electronic or other media, it is subject to HIPAA requirements.
PHSA The Public Health Services Act (1944) assigned the responsibility of preventing communicable diseases within the U.S. to the United States Public Health Service. It also gave the federal government authority to set quarantines. The PHSA has been amended many times, notably by the Health Insurance Portability and Accountability Act (HIPAA) and the Patient Protection and Affordable Care Act (ACA).
POP A Premium-Only Plan (also called a Section 125 Premium-Only Plan) is special type of cafeteria plan that allows employees to pay for employer-sponsored group health plans or even individual health insurance plans with employer-subsidized pre-tax dollars.
PPACA See ACA, Affordable Care Act.
PPO A Preferred Provider Organization is a health plan that features a network of health care providers similar to an HMO. PPOs tend to cost more than HMOs, but they also generally have fewer restrictions on getting care from non-network providers. Another major difference is that it’s generally possible within a PPO to see a specialist or other doctor without a referral or authorization from your primary care physician.
PWBA See EBSA, Employee Benefits Security Administration.
QDRO A Qualified Domestic Relations Order (issued by a court as a judgement, decree or order) establishes a recipient’s right to receive benefits such as child support, alimony payments, or marital property rights payable under a retirement plan.
QMCSO A Qualified Medical Child Support Order is a requirement (introduced by a 1993 amendment to the Employee Retirement Income Security Act, ERISA) that employer group health plans extend health coverage to the children of a parent-employee who is divorced, separated, or never married when ordered to do so by state authorities.
RARC The Reasonable Accommodation Resource Center is an agency within the U.S. Department of Labor (DOL) that serves as a clearinghouse for information, technology and other assistance to support accommodations of workers with disabilities.
SAR A Summary Annual Report is a document furnished to benefit plan participants that condenses the information in the Form 5500 annual report for the information and benefit of the enrollee.
SBJPA The Small Business Job Protection Act (1996) was enacted with the goal to provide tax relief for small businesses, to protect jobs, to create opportunities, to increase the take-home pay of workers. The effective result was to allow smaller businesses to offer 401(k) and pension plans for their workers.
SCHIP The State Children's Health Insurance Program (sometimes called the Children's Health Insurance Program) is a health care program run by the U.S. Department of Health and Human Services (DHHS). Established in 1997, SCHIP is a federal-state partnership similar to Medicaid that gives states some leeway in how to structure and manage their programs.
SMM A Summary of Material Modifications is a document that must be given to a benefits plan participant any time a substantial change is made to the plan. Distribution of the SMM is mandated by ERISA and monitored by regulators.
SPD A Summary Plan Description is a document required by ERISA that informs a benefits plan participant about their rights and benefits under the plan. Regulations also require that an SPD delineate the plan’s sponsor, administrator, and other key elements.
SSA The U.S. Social Security Administration is an agency of the federal government that manages Social Security, a social benefits package that includes retirement, disability, and survivors’ benefits programs.
TITLE VII TITLE VII of the Civil Rights Act (CRA) prohibits employment discrimination based on race, color, religion, sex and national origin. It has been amended several times—notably by the Civil Rights Act of 1991 and the Lily Ledbetter Fair Pay Act of 2009—to allow for compensatory and punitive damages for intentional violations.
TPA A Third-Party Administrator is an agent or entity that processes claims and performs other administrative services, usually for an employee benefits program such as a health cafeteria plan.
USC The United States Code is prepared by the Office of the Law Revision Counsel of the U.S. House of Representatives, and contains a consolidation and codification of all U.S. laws, grouped by subject matter.
USERRA The Uniformed Services Employment and Reemployment Rights Act (1994) protects the reemployment rights of U.S. service members when returning from duty in the uniformed services, prohibiting employer discrimination based on military service or obligation.
VEBA A Voluntary Employees’ Beneficiary Association is a specific type of exempt trust fund that serves as a funding vehicle for health and welfare benefits.
WHCRA The Women’s Health and Cancer Rights Act (1998) protects for patients who elect breast reconstruction in connection with a mastectomy, requiring coverage for reconstructive surgery in a manner determined in consultation with the patient’s doctor(s).
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