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BENEFITS GLOSSARY

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Coinsurance

The set percentage you pay after you meet your annual deductible (or in some cases a copay), but before you reach the out-of-pocket maximum. For example, if you are enrolled in the SureSAVER plan, you will pay 25% after you reach the deductible and Nestlé will pay 75%.

Copays

The set dollar amount you pay for certain medical services even if you haven’t met your deductible. The ExclusiveCARE plan has copays. Copays don’t count toward your deductible; however, they do count toward your out-of-pocket maximum.

Deductible

The amount you must pay each year before the Plan begins to share the cost (e.g., coinsurance). Most eligible medical expenses count toward the deductible; however, copays don’t.

Explanation of Benefits (EOB)

The detailed description provided by medical carriers, such as CareFirst, to show what the plan paid for a service and the remaining amount you need to pay. This is not a bill (the bill will come directly from the provider).

Generic Drugs

These drugs are basically a copy of a brand-name drug but can cost 80% less — which means you pay less. When the patent on a brand-name drug runs out, other companies can make generic versions using the same active ingredients.

Health Savings Account (HSA)

The tax-advantaged account available if you’re enrolled in the SureSAVER or HealthSAVER plan. Think of it like a 401(k) for health care. HSAs are triple-tax-advantaged. Contributions to the account are tax free, money in the account grows tax free and withdrawals are tax free when used for qualified expenses. Nestlé makes a contribution to the HSA, and you can make contributions as well. The money in the account is yours, even if you leave the company.

Tax-free for federal purposes. State tax treatment may vary.

High-Deductible Health Plan (HDHP)

The type of plan that requires you to pay a higher out-of-pocket cost (deductible) for medical care before any costs will be paid by the plan. If the deductible and out-of-pocket maximum meet certain limits set by the IRS, the plan can be coupled with a tax-advantaged Health Savings Account (HSA) to help pay for care.

In-Network Coverage

Medical carriers, like CareFirst, contract with doctors, specialists, hospitals, labs and other facilities across the country to provide you with quality care. These contracted providers are part of our in-network coverage. Going to in-network providers means lower out-of-pocket medical costs.

Maintenance Medications

These are drugs you take on an ongoing basis to treat a chronic condition, such as high blood pressure or high cholesterol. A 30-day supply of a maintenance medication may be filled up to two times at a retail pharmacy. After the second fill, you’ll have to request a prescription for a 90-day supply from your doctor. You can fill the 90-day supply at your local CVS pharmacy, Target or
through the convenience of mail order.

Non-Preferred Brand Drugs

These drugs aren’t on Caremark’s formulary (preferred brand-name) drug list. They typically have a generic or preferred brand equivalent. They’re usually advertised a lot by drug companies and cost more than other types of drugs.

Out-of-Area Coverage

Services delivered in an area where there are not enough network providers used by the NesCARE Plans. Reasonable and customary (R&C) charge limits apply.

Out-of-Network Coverage

Services and providers that are not in the network used by the NesCARE Plans. Receiving services outside of the network results in higher out-of-pocket costs. Reasonable and customary (R&C) charge limits apply.

Out-of-Pocket Maximum

The highest amount you will have to pay each year for eligible medical expenses. If you reach this amount, the plan picks up 100% of eligible costs for the rest of the year. If you’re enrolled in the ExclusiveCARE plan, copays count toward your out-of-pocket maximum.

Preferred Brand Drugs

These drugs are on Caremark’s formulary (preferred brand-name) drug list and typically don’t have a generic equivalent. However, new generic drugs become available each year when brand-name drug patents run out. So a brand-name drug on the preferred brand list today may not be on it
next quarter.

Preferred Provider Organization (PPO)

The type of plan that offers care through a network of providers, but also allows you to use out-of-network providers at a higher cost. There are copays (fixed amounts) for certain services, such as office visits. For other services, such as hospitalization, coinsurance (a percentage) and sometimes a copay apply.

Premiums

The amount you pay annually to have medical coverage provided by Nestlé. Premiums are taken out of your paycheck on a pre-tax basis.

Prescription Drug Out-of-Pocket Maximum

The most you’ll pay in a calendar year for covered prescription drugs before the plans pay 100% for eligible prescription drug expenses. This amount includes your prescription drug copays and coinsurance. Additional charges you pay for filling a prescription with a brand-name drug when a generic equivalent is available (the cost difference) do not count toward this out-of-pocket maximum. If you meet this maximum, you will continue to be responsible for paying the cost difference for any prescription that’s filled with a brand-name drug that has a generic equivalent.

Preventive Care

The type of care that focuses on preventing chronic conditions and diseases in the future. It includes services such as screening tests for blood pressure, glucose, cholesterol and exams such as mammograms and colonoscopies. Nestlé pays for 100% of your eligible in-network preventive care costs. Find more preventive care resources on the Documents page.

Qualified Family Status Change

A qualified family status change is an event that affects your benefits coverage or the coverage of your dependents, such as marriage or divorce; birth or adoption; or a significant change (addition, loss or rate change) in your spouse’s/domestic partner’s benefits coverage.

Reasonable and Customary (R&C) Charge

The maximum amount NesCARE plans will pay for any covered out-of-network or out-of-area services. You are responsible for paying any amount over the R&C charge.

Short-Term Medications

These are drugs you take to treat a temporary condition, such as an infection.

Step Therapy

This approach helps you get the best results from your prescription medications and also saves you money. For certain health conditions (high blood pressure, allergies, etc.), you’ll need to first try a generic drug or the pre-identified, preferred brand-name drug. If it doesn’t work for you, the plans will pay benefits for a higher-cost, alternative brand-name drug.

Tobacco Surcharge

An additional cost added to your medical premiums if you and/or your spouse/domestic partner is a tobacco user. The tobacco surcharge is $50/month for a single user or $100/month for two users.