Glossary

A cafeteria plan is a flexible benefits plan that meets the requirements of IRC Section 125 and offers eligible employees a choice between cash salary and a variety of nontaxable benefits (e.g., health insurance), known as qualified benefits.  Employees are allowed to pay for the benefits they choose on a pre-tax basis.

A carrier is the stop-loss insurer for a self-funded plan that agrees to underwrite (i.e., carry the risk) and provide excess-loss coverage and service.

The term "CDHC" means consumer-driven health care.

A change in status refers to an event that modifies the employee's legal marital status, the number of the employee's dependents, the employment status of an employee or one of the employee's dependents, the place of residence of an employee or one of the employee's dependents, or the eligibility status of a dependent for coverage under a plan.

A claim is a request made of a plan for payment of medical services rendered.

Claim adjudication refers to the review and processing of a claim based on eligibility, fee schedules, usual and customary amounts, and benefit coverage.

A claim administrator is the person or firm, if any, that a plan administrator retains to handle the processing, payment, and settlement of benefit claims and other duties that are specified in a written administration agreement.  If there is no claim administrator (for any reason, including the termination or expiration of the administration agreement with the initial claim administrator), or if the term is used in connection with a duty not expressly assumed by the claim administrator in signed writing, the term means the plan administrator.

Claim lag refers to the time interval between the date a service is rendered or an item is supplied and the date a service or item is processed and paid.

The term "COB" means coordination of benefits.

The term "COBRA" means the Consolidated Omnibus Budget Reconciliation Act of 1985.

Coinsurance is the amount that a covered person must pay for covered health care during a benefit year after meeting the deductible.

A collectively bargained plan is an employee benefits plan that is negotiated between a union and an employer.

COBRA is federal legislation that requires employers who maintain 20 or more employees (including part-time employees who are counted as fractions of full-time employees) during at least 50 percent of the business days in a calendar year to offer extended group health coverage to certain classes of employees and dependents when specific qualifying events occur (e.g., termination of employment, reduction in number of hours of employment, or the divorce or death of the covered employee).  Coverage generally may last for up to 18 months for employees and up to 36 months for dependents.

CDHC is an arrangement that is intended to encourage cost-conscious use of health care by giving individuals a financial stake in reducing their health care costs (e.g., by increasing insurance deductibles or by providing access to a medical savings/reimbursement account).

COB is a cost-savings feature that applies when a participant is covered by multiple plans.  In this situation, one plan normally pays its benefits in full and the other plan pays a reduced benefit.  COB guarantees that the total paid by all plans will not exceed 100 percent of the billed charges.

A co-payment is a cost-sharing arrangement under a health plan in which a participant pays a specified dollar amount for a service, such as $10 for a prescription or $20 for a doctor's office visit.

Cost containment refers to activities such as pre-certification, case management, and benefit incentives, all of which aim to reduce the cost of medical care or limit its rate of increase.

A covered entity includes health plans, health care clearinghouses, and health care providers that conduct covered transactions electronically.  Covered entities are subject to HIPAA's Administrative Simplification mandates.

Covered expenses are charges a covered person incurs for any medically necessary treatments, services, or supplies that the plan does not specifically exclude from coverage.  A covered person incurs covered expenses on the date that he or she receives any medically necessary treatments, services, or supplies.

A CPT code is a current procedural terminology code.

Creditable coverage is coverage of an individual under a group health plan, a group or individual health insurance policy, a health maintenance organization (HMO), Medicare, Medicaid, the State Children's Health Insurance Program (S-CHIP), a public health plan, or any other health plan as set forth in Section 401 of the Health Insurance Portability and Accountability Act of 1996 (HIPAA), as amended, and federal regulations issued pursuant to HIPAA.

A CPT code is a five-character, alpha-numeric code that providers use to bill a specific service to an individual or plan.  The American Medical Association maintains CPT codes.

A custodian is an organization such as a bank, brokerage firm, or mutual fund company that holds the cash and securities of a 401(k), IRA, health savings account, or mutual fund and performs a variety of clerical services (e.g., collecting income and reporting on the value of the assets).