Allowed amount
This is the maximum amount that a plan will pay for a covered health service. It is sometimes referred to as the “negotiated rate,” because it is the amount stated in the contract with providers.
Beneficiary
This is the person who will receive the benefit in the event of your death. You must choose beneficiaries for your HSA, 401(k), and life insurance.
COBRA
The Consolidated Omnibus Budget Reconciliation Act (COBRA) gives workers and their families, who lose their health benefits, the right to choose to continue group health benefits provided by their group health plan for limited periods of time under certain circumstances such as voluntary or involuntary job loss, reduction in the hours worked, transition between jobs, death, divorce and other life events.
Coinsurance
This is the amount you pay for a covered health care service after you reach your deductible. It is calculated as a percentage of the total allowed amount. For example, the plan may pay 90 percent of the cost of a service, and you pay the remaining 10 percent.
Deductible
This is the flat dollar amount you pay each year before the plan begins paying benefits. The deductible varies based on whether you’re covering only yourself or yourself and another family member.
Dental health maintenance organization (DHMO)
A type of dental plan that usually limits coverage to care from providers who work for or contract with the DHMO. It generally won’t cover out-of-network care except in an emergency. A DHMO may require you to live or work in its service area to be eligible for coverage. One of Honeywell’s dental plans is a DHMO (dental health maintenance organization) and the plan only pays for your care if you see an in-network dentist.
Evidence of insurability (EOI)
This is sometimes called “proof of good health” and is used to qualify for certain amounts of group universal life insurance coverage and long-term disability coverage if not elected when you are first eligible. This process can involve urine and blood tests, along with a physical exam, to be scheduled at your work or at home by a physician.
Formulary
A formulary is the list of prescription drugs covered by your prescription drug plan. A formulary can contain both brand-name and generic drugs. If a drug is not on the list, you will pay much more, up to the full cost of the drug.
Highly compensated employee (HCE)
In 2024, a highly compensated employee is someone who makes $155,000 or more. IRS policy sets annual limits for things such as contributions to a 401(k) plan or dependent care flexible spending account (DCFSA) that are lower for highly compensated employees.
Out-of-pocket maximum
This is the maximum amount you need to pay toward your health care for the plan year. Once you reach your out-of-pocket maximum, the plan pays at 100 percent for eligible expenses. Depending on the plan you choose, deductibles may or may not be included in the out-of-pocket maximum.
Preventive care
This refers to health care services provided for disease prevention, as opposed to treatment of a problem. It includes annual physicals, as well as recommended vaccinations and screenings. Honeywell’s health care plan fully covers the cost of preventive care.
Provider network
A provider network is a list of the doctors, other health care providers and hospitals that a plan contracts with to provide medical care to its members. These providers are called “network providers” or “in-network providers.” A provider that isn't contracted with the plan is called an “out-of-network provider.” It typically saves you money to use a provider who is in-network.
Qualified status change or qualified life event (QLE)
A significant event in your life, like getting married or divorced or having a baby, allows you to make changes to your benefits plans. In the absence of such an event, you can only make changes to your plans during the annual enrollment period.
Summary of Benefits and Coverage (SBC)
The SBC is a snapshot of a health plan’s costs, benefits, covered health care services and other features that are important to consumers. SBCs also explain health plans’ unique features, like cost sharing rules, and include significant limits and exceptions to coverage in easy-to- understand terms.
Summary Plan Description (SPD)
An SPD is a document that employers must give free to employees who participate in Employee Retirement Income Security Act-covered retirement plans or health benefit plans. The SPD is a detailed guide to the benefits the program provides and explains how the plan works.
