Open Enrollment Glossary
Open enrollment can introduce a lot of unfamiliar terminology, making it difficult for employees to compare plans and choose the benefits that best fit their needs. This glossary defines common health insurance and employee benefits terms in plain language to help make the enrollment process easier to understand.
A
Annual Enrollment
The designated period each year when employees can enroll in, change, or waive their employer-sponsored benefits for the upcoming plan year.
C
Coinsurance
The percentage of covered healthcare costs you pay after meeting your deductible. For example, if your plan has 20% coinsurance, you pay 20% of covered costs while your insurance pays the remaining 80%.
Commuter Reimbursement Account (CRA)
A benefit account that reimburses employees for eligible commuting expenses, such as parking or public transportation costs, according to the employer’s plan design.
Copay (Copayment)
A fixed dollar amount you pay for certain healthcare services, such as a doctor’s visit or prescription medication.
COBRA
The Consolidated Omnibus Budget Reconciliation Act (COBRA) allows eligible employees and their dependents to temporarily continue employer-sponsored health coverage after certain qualifying events, such as job loss or reduced work hours.
D
Deductible
The amount you must pay for covered healthcare services before your health insurance plan begins sharing costs.
Dependent Care FSA
A pre-tax benefit account that allows employees to pay for eligible dependent care expenses, such as daycare or after-school programs, using pre-tax dollars.
Direct Primary Care (DPC)
A healthcare model that gives patients access to primary care services for a monthly fee paid directly to their provider. Starting in 2026, eligible individuals enrolled in an HDHP can participate in certain Direct Primary Care arrangements while maintaining HSA eligibility.
E
Eligible Expense
A medical, dental, vision, or dependent care expense that qualifies for reimbursement under an FSA, HSA, HRA, or other tax-advantaged benefit, according to IRS guidelines.
Employer Contribution
The amount an employer contributes toward an employee’s health insurance premium, HSA, HRA, or other benefit.
F
Flexible Spending Account (FSA)
A pre-tax account that allows employees to set aside money for eligible healthcare expenses. Depending on the employer’s plan, unused funds may be subject to carryover rules, a grace period, or the use-it-or-lose-it rule.
G
Grace Period
An optional extension that allows employees additional time after the end of the plan year to incur eligible FSA expenses.
H
Health Insurance Premium
The amount paid each month to maintain health insurance coverage. Premiums are often shared between the employer and employee.
Health Reimbursement Arrangement (HRA)
An employer-funded benefit that reimburses employees for eligible medical expenses and, in some cases, health insurance premiums.
Health Savings Account (HSA)
A tax-advantaged savings account available to individuals enrolled in a qualified High Deductible Health Plan (HDHP). HSA funds roll over year after year and remain with the employee if they change jobs.
High Deductible Health Plan (HDHP)
A health insurance plan with a higher deductible and lower monthly premiums than many traditional plans. Enrollment in a qualified HDHP is generally required to contribute to an HSA.
I
In-Network Provider
A doctor, hospital, pharmacy, or healthcare provider that has contracted with your insurance carrier to provide services at negotiated rates.
Individual Coverage Health Reimbursement Arrangement (ICHRA)
An employer-funded health benefit that reimburses employees for eligible individual health insurance premiums and qualified medical expenses.
L
Limited Purpose FSA
A Flexible Spending Account that generally covers eligible dental and vision expenses and is commonly paired with an HSA
O
Open Enrollment
The annual period when employees can enroll in or make changes to their employer-sponsored benefits without experiencing a qualifying life event.
Out-of-Network Provider
A healthcare provider that does not have a contract with your insurance carrier. Receiving care outside your network often results in higher out-of-pocket costs.
Out-of-Pocket Maximum
The maximum amount you’ll pay for covered healthcare expenses during a plan year. Once this limit is reached, your health plan generally pays 100% of covered services for the remainder of the year.
P
Parking Account (PKG)
A pre-tax benefit account that allows employees to pay for eligible parking expenses related to commuting to and from work using pre-tax dollars.
Premium
See Health Insurance Premium.
Preventive Care
Routine healthcare services, including annual physicals, screenings, immunizations, and preventive tests, designed to detect or prevent illness. Many health plans cover preventive care at no additional cost when using in-network providers.
Q
Qualifying Life Event (QLE)
A significant life event that allows employees to enroll in or change benefits outside of open enrollment. Examples include marriage, divorce, the birth or adoption of a child, or loss of other health coverage.
S
Special Enrollment Period (SEP)
A limited period following a qualifying life event during which employees can make changes to their health insurance elections outside of open enrollment.
T
Transportation Reimbursement Account (TRN)
A pre-tax benefit account that allows employees to pay for eligible transit expenses, such as bus, train, subway, or vanpool costs, using pre-tax dollars.
U
Use-It-or-Lose-It Rule
An FSA rule stating that unused funds may be forfeited at the end of the plan year unless the employer offers a carryover provision or grace period.
W
Waiting Period
The amount of time a new employee must wait before becoming eligible for employer-sponsored benefits.
Need Help?
Choosing employee benefits during open enrollment doesn’t have to be confusing. Whether you’re comparing plans, learning about tax-advantaged accounts, or evaluating benefit options for your workforce, understanding these common terms is the first step toward making informed decisions.
Ameriflex helps employers, brokers, and employees simplify benefits through expert guidance, industry-leading administration, and educational resources designed to make healthcare benefits easier to understand.
Contact us today to learn more about our benefits solutions or request a proposal to see how Ameriflex can support your organization.
This glossary is intended for informational purposes only and should not be considered legal, tax, or financial advice. Employers and employees should consult qualified professionals regarding their specific benefits and compliance obligations.