Adopted Child
A child who is adopted or placed for adoption, as defined by the state
in which the adoption takes place.
Affiliation Period
A period of time that must pass before health insurance coverage
provided by an HMO (Health Maintenance Organization) becomes
effective.
If a group health plan provides
coverage to you through an HMO with an affiliation period, the affiliation
period cannot be longer than 2 months (3 months for a late enrollee) from your enrollment date, and the plan cannot impose a
pre-existing condition
exclusion. During the affiliation period, the plan cannot charge you
premiums, and the HMO is not required to provide benefits.
The affiliation period must run concurrently with any waiting period
for coverage under the plan.
Certificate of Creditable Coverage
A written certificate issued by a group health plan or health insurance issuer
(including an HMO) that
shows your prior health coverage (creditable coverage).
A certificate must be issued automatically and free of charge when you lose
coverage under a plan, when you are entitled to elect COBRA
continuation coverage or
when you lose COBRA continuation coverage. A certificate must also be provided free
of charge upon request while you have health coverage or within 24 months after
your coverage ends. For more information, see Questions and Answers: Recent Changes in Health Care Law.
COBRA (Consolidated Omnibus Budget
Reconciliation Act of 1985)
COBRA is a Federal law that provides rights to temporary continuation of group health plan coverage for certain employees,
retirees and family members at group rates when coverage is lost due to
certain qualifying events.
COBRA Continuation Coverage
The temporary continuation of group health plan coverage available after a
qualifying event to certain
employees, retirees and family members who are qualified beneficiaries.
Those who are eligible may be required to pay for COBRA continuation coverage and are generally
entitled to coverage for a limited period of time (from 18 months to 36
months), depending on certain circumstances.
Covered
Employee
An individual who is (or was) provided coverage under a group health plan that is subject
to COBRA because that individual was employed by one or more persons maintaining the
group health plan.
Creditable Coverage
Health coverage you have had in the past, such as coverage under a
group health plan (including
COBRA continuation coverage), an HMO, an
individual health insurance policy, Medicare or Medicaid, and this prior
coverage was not interrupted by a significant break in coverage. The
time period of this prior coverage must be applied toward any
pre-existing condition
exclusion imposed by a new health plan. Proof of your creditable coverage
may be shown by a certificate of
creditable coverage or by other documents showing you had health
coverage, such as a health insurance ID card. For more information, see Questions and Answers: Recent Changes in Health Care Law.
Drug
Formulary
A list of all the medicines that will be covered by your
group health plan.
Elect
When referring to health coverage, this means to choose, generally in writing, to participate in a
group health plan.
Election Notice
Written notification that you are eligible for
COBRA continuation coverage. This notice should explain how long
you will have to decide whether or not to elect COBRA continuation coverage. The
group health plan
must give you at least 60 days from the
date the notice is provided to you, or from the date your coverage ended,
whichever is later, to elect COBRA continuation coverage. The election notice should explain,
among many other things, how much you must pay for coverage and when and to
whom the payments are due.
Employee Organization
Any labor union or organization of any kind in which employees
participate and which exists for the purpose of dealing with employers
concerning an employee benefit plan (including group health plans) or other
matters involving employment relationships. An employee organization can also be an employee
beneficiary association.
ERISA (Employee
Retirement Income Security Act of 1974)
ERISA is a Federal law that
regulates employee benefit plans, such as group health plans, that
private sector employers, employee organizations (such as unions), or both, offer to employees
and their families.
Enrollment
Date
The first day of coverage or, if there is a
waiting period, the first day of
the waiting period. If you enroll when first eligible for
coverage, your enrollment date is generally the first day of employment.
If you enroll as a late enrollee, your enrollment date is the first
day of coverage.
Exhausted COBRA Coverage
The end of your
COBRA continuation coverage because the period
of time that this coverage was available to you has lapsed, or for any
reason other than your failure to pay premiums on time or for cause (such as
making a fraudulent claim or an intentional misrepresentation of a material fact
in connection with your plan). Additional reasons for exhaustion of COBRA
coverage are possible besides the time being up. You have exhausted your
COBRA continuation coverage if the coverage ends because your employer failed to pay the
premiums on time or you no longer live or work in an HMO service area and there is no similar COBRA
coverage available to you. You need not accept a conversion policy at
the end of your COBRA coverage in order to exhaust your COBRA coverage.
Genetic
Information
Information about genes, gene products and
inherited characteristics that may derive from you or a family member. This
includes information regarding carrier status and information derived from
laboratory tests that identify mutations in specific genes or chromosomes,
physical medical examinations, family histories and direct analysis of genes or
chromosomes.
Gross
Misconduct
The term "gross misconduct" is not specifically
defined in COBRA or in regulations under COBRA. Therefore, whether a
terminated employee has engaged in "gross misconduct" that will justify a
plan in not offering COBRA to that former employee and his
or her family members will depend on the specific facts and circumstances. Generally,
it can be assumed that being fired for most ordinary reasons,
such as excessive absences or generally poor performance, does not
amount to "gross misconduct."
Group
Health Plan
An employee benefit plan established or maintained by an employer or by an
employee organization (such as a union),
or both, that provides medical care to employees and their dependents directly
or through insurance (including an HMO),
reimbursement or otherwise.
HMO (Health Maintenance
Organization)
Legal entity consisting of participating medical
providers that provide or arrange for care to be furnished to a given population group for a fixed fee
per person. HMOs are used as alternatives to traditional indemnity plans.
HIPAA (Health
Insurance Portability and Accountability Act)
HIPAA is a Federal law that limits
pre-existing condition
exclusions, permits special enrollment
when certain life or work events occur, prohibits discrimination against
employees and dependents based on their health status, and guarantees
availability and renewability of health coverage to certain employees and
individuals.
Late Enrollee
An individual who enrolls in a group
health plan on a date other than either the earliest date on which coverage can
begin under the plan terms or on a special
enrollment
date. Under HIPAA, a late enrollee may be subject to a maximum
pre-existing condition
exclusion of up to 18 months.
Mental Health Parity
Act (MHPA)
MHPA is a Federal law that requires annual
or lifetime dollar limits on mental health benefits provided by a group
health plan to be no
lower than the annual or lifetime dollar limits
for medical
and surgical benefits offered by that plan. MHPA applies to employers with
more than 50 employees.
NOTE:
The Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA)
requires group health plans and health insurance issuers to ensure that
financial requirements (such as co-pays, deductibles) and treatment
limitations (such as visit limits) applicable to mental health or substance
use disorder (MH/SUD) benefits are no more restrictive than the predominant
requirements or limitations applied to substantially all medical/surgical
benefits. For more information on MHPAEA, see the
fact sheet.
Newborns' and Mothers' Health Protection Act (Newborns' Act)
The Newborns' Act is a Federal law that prohibits group
health plans and
insurance companies (including HMOs) that cover
hospitalization in connection with childbirth from restricting a mother's or newborn's benefits for such
hospital stays to less than 48 hours following a vaginal delivery or 96 hours
following delivery by cesarean section, unless the attending doctor, nurse
midwife or other
licensed health care provider, in consultation with the mother, discharges earlier.
Plan
Administrator
The person who is responsible for the management of the plan. The
plan administrator is a person specifically designated by the terms of the
plan. If the plan does not make such a designation, then the
plan sponsor is generally the plan administrator.
Plan
Sponsor
Generally, the employer, the employee organization (such as a union), or both, that establishes or
maintains an employee benefit plan, including a group health plan.
Pre-existing Condition
An illness or condition that was present before an
individual's first day of coverage under a group health plan. For more information, see Questions and Answers: Recent Changes in Health Care Law.
Pre-existing Condition
Exclusion
A limitation or exclusion of benefits for a condition based on the
fact that you had the condition before your enrollment date in the group health plan. A pre-existing condition
exclusion may be applied to your condition only if the condition is one for
which medical advice, diagnosis, care or treatment was recommended or received
within the 6 months before your enrollment date
in the plan. A pre-existing condition exclusion cannot be applied to pregnancy
(regardless of whether the woman had previous coverage), or to
genetic information in the absence of
a diagnosis. A pre-existing condition exclusion also cannot be applied to a
newborn or a child who is adopted or placed for adoption if the child has
health coverage within 30 days of birth, adoption or placement for adoption and
does not later have a significant
break in coverage. If a plan provides coverage to you through an
HMO that has an affiliation
period, the plan cannot apply a pre-existing condition exclusion. A
pre-existing condition exclusion can not be longer than 12 months from your
enrollment date (18 months for a late enrollee).
A pre-existing condition exclusion that is applied to you must be reduced by
the prior creditable coverage you have that
was not interrupted by a significant
break in coverage. You may show creditable coverage through a
certificate of creditable
coverage given to you by your prior plan or insurer (including an HMO) or
by other proof. The plan can apply a pre-existing condition exclusion to you
only if it has first given you written notice. If your plan has both a waiting period and a pre-existing condition
exclusion, the exclusion begins when the waiting period begins. In some states,
if plan coverage is provided through an insurance policy or HMO, you may have
more protections with respect to pre-existing condition exclusions.
Pre-existing Condition
Exclusion Period
The period of time that a group health plan can legally limit your access to
the health benefits offered by that plan because of a
pre-existing condition. Under
HIPAA, the maximum pre-existing condition exclusion
period that can be applied to an individual is 12 months (18 months for late enrollees).
Qualified Beneficiary
Generally, qualified beneficiaries include covered employees, their spouses and their
dependent children who are covered under the group health plan on the day before the
qualifying event. In certain cases,
retired employees, their spouses and dependent children may be qualified
beneficiaries. In addition, any child born to, or placed for adoption with,
a covered employee during a period of
COBRA continuation coverage is a qualified beneficiary.
Qualifying
Event
Certain events that would ordinarily cause an individual to lose health coverage. The type of
qualifying event will determine who the qualified beneficiaries for the qualifying event
are and the length of time COBRA continuation coverage is available.
For more information, see Questions and Answers: Recent Changes in Health Care Law.
Significant Break in
Coverage
Generally, a significant break in coverage is a period of 63
consecutive days during which you have no creditable coverage. In some states, the
period is longer if your plan coverage is provided through an insurance
policy or HMO. Days in a waiting
period during which you had no other health coverage cannot be counted
toward determining a significant break
in coverage. For more information, see Questions and Answers: Recent Changes in Health Care Law.
Similarly Situated
Non-COBRA Beneficiaries
The group of covered employees, their
spouses or dependent children who are covered under a group health plan maintained
by the employer or employee
organization. This group is receiving their
benefits under the group plan and not through
COBRA continuation coverage. They are most similarly situated to the circumstances
of the qualified beneficiary immediately
before the qualifying event.
SPD
(Summary Plan Description)
An important document that the plan administrator must provide
to participants and beneficiaries that explains what coverage the plan offers,
how the plan operates and the rights and responsibilities of participants and beneficiaries.
Each SPD is different. If you need a copy of the SPD, contact your plan
administrator.
Special
Enrollment
The opportunity to enroll in a group
health plan when certain work
or life events occur, regardless of the plan's regular enrollment dates. Generally,
if certain conditions are met, special enrollment is available when
you, your spouse or your dependents lose other coverage (including
exhaustion of
COBRA continuation coverage), when you marry or when you have a new child by
birth, adoption or placement for
adoption. The plan must give you at least 30
days--from the loss of coverage or from the date of the marriage, birth,
adoption or placement for adoption--to request special enrollment. The maximum
pre-existing condition
exclusion that may be applied to a person upon special enrollment is 12
months (reduced by the person's prior creditable coverage). However,
if enrolled within 30 days of birth, adoption or placement for
adoption, children may be exempt from any pre-existing condition
exclusion. A
description of a plan's special enrollment rules must be given to the
employee on or before the time the employee is offered the opportunity to
enroll in the plan. For more information, see Questions and Answers: Recent Changes in Health Care Law
Waiting
Period
The period that must pass before an employee or dependent is
eligible to enroll (becomes covered) under the terms of the
group health plan. If the employee or
dependent enrolls as a late enrollee or on a
special enrollment date, any period before
the late or special enrollment is not a waiting period. If a plan has a waiting
period and a pre-existing condition
exclusion, the pre-existing condition exclusion period begins when the
waiting period begins. Days in a waiting period are not counted toward
creditable coverage unless there is other
creditable coverage during that time. You should try to maintain creditable
coverage during a waiting period to reduce any pre-existing condition exclusion
that may apply. Days in a waiting period are also not counted when determining
a significant break in coverage.
Women's Health and Cancer Rights
Act (WHCRA)
WHCRA is a Federal law that
provides important protections for individuals who have undergone a mastectomy.
For more information, see Your Rights After
a Mastectomy: The Women's Health and Cancer Rights Act.
U.S. Department of Labor
