(by Andres Rojas)
The healthcare industry is one of the most strictly regulated industries in America. Every year, new regulations and organizations come into being. With things changing so fast, it’s no wonder that even some HR workers have trouble remembering what basic healthcare terms like HRA or QSEHRA mean. In this guide, we’ll continue where we left on Part 1.
Administrative Services-Only is a term that refers to self-funded health plans where employers provide the funding but hire third-party administrators to run their system. This type of plan has many benefits for businesses of all sizes, namely their low-cost when compared to conventional health plans.
The Centers for Medicare and Medical Services is a federal agency within the U.S. Department of Health and Human Services that is responsible for overseeing most of the country’s national healthcare programs – such as Medicare, Medicaid, the Children’s Health Insurance Program, and both state and federal health marketplaces.
The 1985 Consolidated Omnibus Budget Reconciliation Act is a law that allows workers and their dependents who lost their health benefits due to specified circumstances to temporarily extend their coverage – only workers who are enrolled in a company’s group healthcare insurance plan before the qualifying event occurred are eligible for COBRA benefits.
An Exclusive Provider Organization is a type of health insurance plan that only allows their insured to receive medical services from doctors, specialists, hospitals, clinics, and other healthcare providers within their network – though exceptions are made for emergencies.
Fee-for-Service is a payment arrangement where each visit and service used is paid for separately. Though this model is usually more expensive than managed care plans, FFS plans incentivize healthcare providers to diversify their treatments as payment depends more on the quantity than on the quality of care.
Federally Qualified Health Centers are community healthcare providers funded through the Health Resources and Services Administration‘s Health Center Program. They are defined by the Medicare and Medicaid statutes mostly found in underserviced areas where they offer primary care services for people of all ages.
A Health Savings Account allows employees enrolled in an HDHP to save untaxed money and use it to pay for qualified healthcare expenses. HSAs are fully owned and controlled by employees, help workers with high-deductible plans to cover their out-of-pocket expenses and allow employers and family members to contribute to them.
A High-Deductible Plan is a health insurance plan with a high minimum deductible for healthcare expenses – in 2020, the IRS defined them as any plan with a deductible of at least $1,400 for individuals and $2,800 for families. Though these plans have lower premiums than others, their high out-of-pocket ceiling can leave their insured with a bill they can’t afford.
A Health Maintenance Organization provides health insurance coverage for a monthly or annual premium. HMOs are typically less expensive than other health insurance providers – though at the cost of limiting their medical coverage within their network of doctors and healthcare providers.
A Preferred Provider Organization is a managed health plan that provides access to a network of healthcare providers at a discount rate. While HMOs have lower premiums, PPOs have fewer restrictions about seeing non-network providers – though they tend to lower rates for non-network providers.
Paid-Time-Off or Personal-Time-Off is a policy that bundles sick days, vacation days, parental leave, sick leave, and personal time into a single pool of paid vacation hours that employees can use at their discretion. Besides being an attractive employee benefit, these types of policies can simplify administrative tasks – particularly for employers who rely on PTO banks.
A Qualified Health Plan is a healthcare insurance plan that meets ACA’s basic requirements, such as providing minimum essential coverage; being certified by the Health Insurance Marketplace; and using standard limits on cost-sharing for premiums, out-of-pocket amounts, and other expenses.
The Small Business Health Options Program allows small businesses with up to 50-full time employees to provide medical and dental coverage to their workers. SHOP insurance has no limited enrollment period – employees can pick and drop plans at any moment – and allows some small employers to qualify for tax credits.
Didn’t find the term you were looking for? Then check this link for more healthcare acronyms and their meaning.