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A
Adjudication
The process of reviewing a claim to determine eligibility under the group contract.
Administrative Services Only Plan (ASO)
Employer self-insures selected benefits, and contracts a Third Party Administrator to adjudicate and pay claims. The employer then reimburses the Third Party Administrator for claims paid plus an administration fee and taxes.
All Source Maximum
Term used in connection with disability benefits. It ensures that a plan member’s total income from all sources does not exceed a specified percentage of pre-disability income.
Anti-selection
The inclination of a plan member to only choose benefits based on a known or expected medical condition.
Any Occupation
Term applicable to the definition of disability for disability benefits. Under this definition, a plan member is considered totally disabled if unable to perform the duties of ‘any occupation’ for which the plan member is able or may reasonably become able, by means of education, training or experience.
Assignment of Benefits
Benefits are made payable to the provider, as authorized by the plan member.
Assistive Devices Program
A program provided by the province of Ontario to financially assist residents with long-term physical disabilities to obtain assistive devices appropriate for the individual’s needs. Learn more about the Assistive Devices Program.
B
Beneficiary, Contingent
In the event that the Primary Beneficiary predeceases the plan member, benefits are made payable to the Contingent Beneficiary.
Beneficiary, Primary
The person(s) a plan member selects to receive benefits payable from Life and/or AD&D insurance.
Benefit Period
The maximum length of time payments will be made for a disability claim.
C
Co-ordination of Benefits
If a person has health and/or dental coverage with more than one insurer, co-ordination of benefits allows for the payment of eligible expenses from all plans, up to a total of 100%.
Consumer Price Index (CPI)
Provides a broad measure of the cost of living in Canada.
Conversion Privilege
On termination of group Life Insurance, a plan member may apply to receive an individual life policy without providing evidence of insurability.
Cost Plus
On behalf of an employer, an administrator will pay eligible medical and dental expenses. The employer agrees to pay the cost of the claim plus an administration fee and taxes. Learn more about MDM’s Cost Plus Program.
Cost of Living Adjustment
If this option has been included in a Long Term Disability plan, a disabled plan member’s benefit amount is increased to offset inflation following one full year of benefit payments. The adjustment is based on the average Canadian Consumer Price Index for the previous October 1st to September 30th, but will not exceed a specified percentage as outlined in the group contract.
D
Deductible
The amount a plan member must pay before the insurer will pay for health and/or dental expenses.
Demographics
The statistical characteristics of a specific group of people. These statistics may be based on age, gender, income, occupation, and marital status.
Dental Fee Guide
A guide published by the dental association of each province and territory (except Alberta), listing the recommended fees for dental procedures.
Dependent Life Insurance
Life Insurance coverage for a plan member’s eligible dependents. Benefit is made payable to the plan member.
Dispensing Fee
A fee charged by a pharmacy to dispense medication. It is also called a filling fee.
E
Early Intervention
A Disability Management program designed to assist a plan member to make a healthy recovery, with the intention of returning to their previous, or modified job. Learn more about MDM’s Early Intervention Program.
Electronic Data Interchange
Real-time electronic claims adjudication. Claims information is electronically transmitted and exchanged between the provider and the insurer.
Elimination Period
A period of time a plan member must complete in order to qualify for disability benefits.
Employee Assistance Program (EAP)
Provides support to plan members and eligible dependents facing challenges due to personal or work-related issues.
Endodontic
Dental treatment of tooth pulp and root canal.
Evidence of Insurability
If an employee is a late applicant, or is eligible for coverage above the Non-Evidence Maximum, or is applying for coverage, health evidence must be submitted to the insurer before coverage can be approved.
An individual will be required to complete a questionnaire, and may be required to have a medical examination by a physician, or blood work etc.
Experience-Rated Benefit
The premium for this type of benefit is calculated based in whole or in part on a group’s claims experience. Also called a prospectively rated benefit.
Explanation of Benefits
A statement sent to a plan member to provide details on the payment of a submitted claim.
F
Filling Fee
A fee charged by a pharmacy to dispense medication. It can also be called a dispensing fee.
G
Generic Drugs
A generic drug has the same active ingredients at the same doses as the original brand name drug, but is normally less expensive than the brand name drug.
Grandfathering
When a group plan changes insurers, the new insurer may agree to maintain Life, AD&D and/or Long Term Disability benefit amounts for certain individuals.
H
Health Evidence Maximum
The maximum Life and/or Disability coverage that a plan member can receive, in excess of the Non-Evidence Maximum.
Health Spending Account (HSA)
An employer-funded account for each plan member that can be used to reimburse medical and dental expenses. Expenses must qualify under the Income Tax Act in order to be paid. Learn more about MDM’s Health Spending Account Program.
I
Incurred But Not Reported Reserve
The portion of premium the insurer will set aside to cover claims that plan members have incurred, but not yet submitted.
It also covers any ongoing liability the insurer has after a plan has terminated.
Insured Year
12-month period starting from the effective date of coverage. The insured year can vary between plan members, depending on each person’s effective date of coverage.
L
Late Applicant
An employee that applies for coverage after the grace period following the waiting period has expired.
Loss Ratio
The ratio of claims plus expenses to premium.
M
Major Restorative
Dental treatment related to dentures, crowns and bridgework.
Minor Restorative
Dental treatment related to oral surgery, restorations, prosthetic repairs and relines.
Morbidity Rate

The rate at which individuals become disabled. It is normally calculated separately by age and gender.
Mortality Rate
The frequency of death claims. It is normally calculated separately by age and gender.
N
Non-Evidence Maximum
Relating to Life and Disability benefits, this is the maximum coverage an individual can receive without submitting evidence of insurability.
Non-Taxable
If disability premium is paid completely by the plan member, then disability benefits will be not be subject to tax.
O
Optional Life Insurance
This coverage is in addition to basic group insurance. Both the plan member and his/her spouse can apply for this coverage. The plan member pays the premium, and evidence of insurability is required. Learn more about MDM’s Optional Life Insurance Policies.
Other Health Practitioner
Provider of a health service such as a massage therapist or physiotherapist.
Over-the-Counter Drugs
Drugs legally available without a prescription.
Own Occupation Definition of Disability
Term applicable to the definition of disability for disability benefits. Under this definition, a plan member is considered totally disabled if unable to perform the usual and customary duties of his/her own occupation for a specific period of time, usually two years. After two years, the definition of disability changes to any occupation.
P
Palliative Care
Treatment for the relief of pain in the final state of a terminal condition.
Participation Requirements
As stipulated by the insurer, the percentage of employees that must be enrolled in the group plan.
Periodontal
Dental treatment of gums.
Pre-determination of Benefits
A pre-determination will show whether or not a medical or dental treatment is covered by the plan, and at what cost to the plan member. A detailed treatment plan is submitted to the insurer prior to treatment. It is usually recommended that a plan member obtain a pre-determination for treatment likely to exceed $400.
Pre-existing Condition
A medical condition, for which a plan member sought and/or received treatment, that existed within a specified period of time before the effective date of coverage.
Prescribed Drug Plan
Drugs covered under this type of plan include over-the-counter medications that have been prescribed by a physician or dentist.
Prescription Drug Plan
This type of plan only covers drugs that legally require a prescription from a physician or dentist. This means that over-the-counter medications are not covered even if they have been prescribed.
Prospectively-rated Benefit
The premium for this type of benefit is calculated based in whole or in part on a group’s claims experience. Also called an experience-rated benefit.
R
Recurrent Disability Provision
If a disabled plan member tries to return to work, but within a specified period of time becomes totally disabled again due to the same or related causes, disability benefits will continue without the need to satisfy another elimination period.
Rehabilitation Program
A program provided for a plan member receiving long-term disability benefits. The purpose is to assist the plan member return to work, and may include coverage for the cost of assessment, vocational retraining or an education program.
Renewal
An insurer’s annual review of a group policy to determine whether or not premium levels are appropriate.
Retention Accounting Plan
This type of plan allows an employer to share in the financial results of a group plan at the end of the policy year.
S
Schedule of Benefits
Located near the front of a benefit booklet, the schedule of benefits gives a condensed breakdown of the coverage provided.
Stop Loss Insurance
Offsets the risk of unexpectedly high claims under a self-insured health plan. Once claims for an individual or family have reached a certain amount, the cost for any further claims during the policy year transfers from the employer to the insurer.
Survivor Benefits
Health and dental benefits are extended to eligible dependents of a deceased plan member for a specified period of time, without payment of premium.
T
Target Loss Ratio (TLR)
This represents the percentage of the paid premium that will be actually used to pay claims. The difference represents the amount that the insurer needs for expenses.
Taxable
If the employer pays any portion of disability premium, then disability benefits will be subject to tax.
Trend Factor
Expected increase in claims consumption due to inflation and increased costs.
Trillium Drug Program
A program provided by the province of Ontario to help people who have high drug costs in relation to their income.
W
Waiting Period
The period of time an employee must wait before joining the group plan.
Waiver of Premium
While a plan member is totally disabled, premium for certain benefits does not have to be paid to the insurer.

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