Terms to Know


Health, Welfare and Income Protection Terms

Terms:

Coinsurance
A percentage of the cost of eligible medical expenses you are responsible for paying, after the deductible is met.


Deductible
The amount of money you pay each plan year before the medical/prescription and/or dental plan pay a benefit.


Eligible Charges
Charges for services covered under a benefit plan.


Evidence of Insurability
Any statement of proof of a person's physical condition affecting his/her acceptance for insurance.


Employer-Paid Benefits
A cost incurred by your employer for your health and welfare coverage, income protection, retirement benefit, Social Security / Medicare and taxes. 


Flexible Spending Account (FSA) – Dependent Care
Allows employees to use pre-tax dollars from their paychecks to pay for the cost of care for children or elderly dependents.


Flexible Spending Account (FSA) – Health Care
Allows employees to use pre-tax dollars from their paychecks to pay for qualified health care expenses. You cannot participate in a Health Care FSA if you elect medical insurance through Farm Credit Foundations. You would be eligible to participate in a Health Savings Account (HSA) and Flexible Spending Account (FSA) - Limited Purpose.


Flexible Spending Account (FSA) – Limited Purpose
Allows employees to use pre-tax dollars from their paychecks to pay for the cost of eligible dental and vision expenses. Employees are only allowed to participate in this plan if they are enrolled in a high-deductible health plan (Consumer Choice 1 or Consumer Choice 2).


Generic Drugs
Generic drugs have the same chemical make-up of a corresponding non-preferred brand drug whose patent has expired.


Health Insurance
Includes medical and prescription, dental and vision.


Health Savings Account (HSA)
A Health Savings Account is the vehicle that allows employees in a high-deductible health plan (HDHP) to set aside tax-exempt contributions for current and future qualified medical expenses in an account made available through their employer or financial institution.


High-Deductible Health Plan (HDHP)
An HDHP allows employees to save money on their insurance premium in exchange for a higher deductible. When employees are covered under a traditional medical plan, they pay a substantial monthly premium, whether they use the plan or not.


Income Protection
Includes long-term disability insurance. Some employers also offer short-term disability and sick pay.


Preferred Provider Organization (PPO)
An organization in which networks are created with preferred providers (medical/dental professionals who have contracts with the organization to provide services at a discounted rate). Typically, benefits will be greater and costs will be lower if the participant uses an in-network provider.


Reasonable & Customary (R&C)
The average fee charged by a particular type of provider within a geographic area. Medical and dental plans use this amount to determine the maximum amount to be paid for a service.


Pre-Tax /Tax Advantage Reimbursement Accounts
Consists of Flexible Spending Health Care Account, Flexible Spending Dependent Care Account, Flexible Spending Limited Purpose Account and Health Savings Account. These accounts allow employees to contribute money on a pre-tax basis for a specific purpose. This helps employees lower their taxable income by using tax-free money for allowable expenses. For a list of allowable expenses, reference the IRS website at www.irs.gov, publication 502.


Qualified Status Change
An event that allows you to make coverage changes you could not otherwise make under a pre-tax plan as long as you make those changes within 31 days of the event – (marriage, divorce, etc.) Note: birth of child/adoption is within 60 days of the event. 


Welfare Coverage
Includes Life/Accidental Death & Dismemberment (AD&D) insurance.


Wellness Benefits
Certain services whose priority is the prevention and early detection of conditions. It does not include care or monitoring of an existing condition.