ACRONYMS

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  • A Highly Compensated Employee (HCE) for 2026 is generally defined by the IRS as someone who owns >5% of a company or earns over $160,000 annually, which can trigger ADP/ACP 401(k) nondiscrimination testing. This status limits 401(k) contributions and affects retirement plan compliance, often requiring refunds of excess contributions if tests are not met.
  • Human Capital Management is a comprehensive strategy and set of practices for managing an organization's workforce as a valuable asset, rather than just a cost. It covers the entire employee lifecycle—hiring, onboarding, compensation, performance management, training, and retention—using technology to align employee skills with organizational goals.
  • A HCMS, Human Capital Management System. is a comprehensive suite of software and practices used to manage an organization's most important asset—its people—from hire to retirement.
  • A High Deductible Health Plan (HDHP) is a type of health insurance that features lower monthly premiums but requires higher out-of-pocket, upfront costs for medical care before insurance begins to pay. Often paired with a Health Savings Account (HSA) for tax-free savings, these plans are best for individuals who are generally healthy and have low, predictable medical expenses.
  • A Highly Integrated Dual Eligible Special Needs Plan (HIDE SNP) is a type of Medicare Advantage plan designed specifically for individuals who qualify for both Medicare and Medicaid. HIDE SNPs are designed to "highly integrate" or coordinate care between the two programs to provide a more seamless experience for members, often including extra benefits at little or no cost
  • HIPAA stands for the Health Insurance Portability and Accountability Act of 1996, a U.S. federal law designed to protect sensitive patient health information from being disclosed without consent. It mandates security standards to guard electronic protected health information (ePHI) and privacy rules for medical records, applying to healthcare providers, insurers, and clearinghouses.
  • An HMO is a Health Maintenance Organization: a managed care plan that offers lower-cost healthcare by limiting coverage to a network of doctors and hospitals. Members typically choose a Primary Care Physician (PCP), need referrals for specialists, and must live or work in a specific service area
  • A Health Reimbursement Arrangement (HRA) is an employer-funded, tax-advantaged health benefit plan that reimburses employees for qualified medical expenses. Employers own the account and set contribution amounts, often covering premiums and out-of-pocket costs, while unused funds may carry over. HRAs provide flexible, tax-free, and personalized health coverage options.
  • A Human Resource Information System (HRIS) is software that digitizes, stores, and manages employee data and HR processes—such as payroll, benefits, and compliance—in a centralized, often cloud-based system. It streamlines HR administration, improves data accuracy, and enhances employee self-service, reducing reliance on manual, paper-based tasks.
  • A Human Resources Management System (HRMS) is a suite of software applications that automates and manages core HR functions—such as payroll, recruitment, employee data, benefits, and performance management—in one central, digital location. It streamlines administrative tasks, reduces errors, improves regulatory compliance, and offers self-service portals.
  • Human Resources Outsourcing (HRO) is a business arrangement where an organization contracts an external provider to manage specific, or all, HR functions—such as payroll, recruitment, benefits, and compliance—to reduce costs and improve efficiency. Unlike a Professional Employer Organization (PEO), standard HRO does not typically involve a co-employment relationship.
  • A Health Savings Account (HSA) is a tax-advantaged personal savings account for individuals with a High-Deductible Health Plan (HDHP) to pay for qualified medical expenses like deductibles, copayments, and prescriptions. It offers a triple-tax benefit: contributions are tax-deductible, growth is tax-free, and withdrawals for medical expenses are tax-free. Funds roll over annually, making them a portable, long-term savings tool.