The ad is confusing. That's the point. “Your CEO wants a PPO.COO an HMO. CFO to IPO. You need a good TPA,” announces the piece,created for Entrust, a third-party benefits administration companyin Houston.

The clever spoof underlines a real problem. The benefitsadministration world is awash in alphabet soup, with acronyms todenote everything from medical products and procedures to laws andregulations. As long as everyone in a conversation knows what anacronym means, the shorthand referrals are harmless ways to save alittle time.

Trouble can arise, however, when not everyone knows what a givenacronym means. “The use of acronyms in our industry can lead toconfusion for employees or their dependents, and it's incumbent onus to be as clear as possible so they understand their benefits andtheir rights as they relate to those benefits,” says Robyn M.Jacobson, Entrust's chief operating officer. Achieving thatclarity, she says, means paying attention to how and where you useacronyms.

A necessary tool 

For all their potential for confusion, acronyms serve alegitimate function, allowing people in the benefits industry—orany group—to say and write things faster.

“I wouldn't want to say Consolidated Omnibus BusinessReconciliation Act instead of COBRA every time I refer to that law,” says Patsy Grooms, chiefoperating officer at North American Administrators inNashville.

“Acronyms are the new way of life,” agrees Tina Ann Davis,general counsel at Flex-Plan Services Inc., a third-partyadministrator in Bellevue, Wash. They're quick and concise, shenotes, a perfect fit for email and text messaging.

As specific acronyms become common, some of them enter thestandard lexicon. When Grooms refers to COBRA, for instance, shecan be fairly sure that her audiences understand that she's nottalking about snakes. That acronym has joined scuba, laser, and FYIas a commonly understood abbreviation.

Other acronyms are common in the benefits industry—but not amongthe general public. ERISA is one example.

Confusion is a virtual certainty when a benefits company uses anacronym to mean something different than it means in commonparlance. Grooms' firm, for instance, uses DOA as a shorthand fordetails of accident—not dead on arrival.

Davis notes that she “has a hard time disconnecting from thebenefits lexicon when I'm talking to family and friends, andthey'll say that they have no idea what I'm talking about. That'swhen I understand how non-intuitive the benefits industry canbe.”

Managing muddle

There's no escaping acronyms—so benefits professionals have tomanage them. That can be particularly tricky for third-partyadministrators, whose job description puts them in contact withboth other industry professionals, including brokers and humanresources executives, and also with clients and employees. Manythird-party administrators find that their benefits industrycolleagues are familiar with many of the acronyms they use. Thosesame acronyms, however, can leave clients and employees in thedust.

Third-party administrators often adopt a two-part strategy: Theyuse acronyms as much as they like with other industryprofessionals, being careful to check in when they hear anunfamiliar term or sense that someone doesn't understand whatthey're saying.

“If I'm getting a communication from another source and theacronym is different, I check to make sure we're talking about thesame thing,” Davis says.

The same professionals avoid acronyms, or use only those in verycommon circulation, when they talk with clients and employees.David Rubenzahl, president of Maxon Administrators in Irvington,N.Y., follows that two-part strategy. With other benefitsprofessionals, he uses acronyms.

With clients and employees, however, “I don't use acronyms. Iuse the actual terms they refer to until they become part of thelexicon,” Rubenzahl says. That process, he estimates, takes betweeneighteen months and two years.

“With clients, I use acronyms that everybody knows, like HMO orPPO. I've never run into anybody who doesn't know what those mean,”he says.

Using acronyms at all, of course, means trying to keep up withthe new ones—and that's not easy. New laws, treatments and otherunwieldy terms are a bountiful source of new acronyms.

“Every area of our business has acronyms associated with it:claims paying, the administration of our plans, and all of thelegislation that comes down,” Grooms says, adding that differentcompanies may use different terminology. That exposure keepsbenefits professionals encountering new, acronym-based terminology,especially when they go from one company to another.

New health care legislation is a particularly generous source ofnew abbreviations, Davis says, citing the Center for ConsumerInformation and Insurance Oversight as just one example.

As health care reform moves along, she says, the acronyms itgenerates will become better known.

“But as we move toward full implementation, we'll havedepartments that are implementing different sections of the law.Those departments will spawn their own new acronyms, so we'll havemore unfamiliar acronyms before we have fewer,” she points out.Those acronyms may stay obscure or become well known, depending onhow central they are to important concepts within the new law andhow frequently they're used.

All these new acronyms can require special care, to make surethere's no misunderstanding.

No matter whom she's addressing, Davis says, “I definitely tryto reference the actual law before I use any acronym.”

She's particularly careful to write out terms when she firstmentions them in an email or other written communication, she says,noting that this is also a good legal practice.

“We try to explain at least once what we're talking about by itsofficial, total name, so we aren't making assumptions about whatour audience understands,” Grooms agrees. “We use NAA for NorthAmerica Administrators, and I would never use that on the firstmention without writing North America Administrators and thenputting NAA in parenthesis.”

Some third-party administrators even go upstream, to try andstem acronyms at their sources. Jacobson and other members of theTexas Association of Benefit Administrators and Society ofProfessional Benefit Administrators work directly with theregulators, medical associations and lawmakers who often createbenefits industry acronyms in the first place.

“We work behind the scenes on a regular basis to clarify anddefine our roles, and we specifically try to stay away fromacronyms,” Jacobson says.

The work proceeds in small steps, she adds. Jacobson and otherbenefits industry professionals have met with the Texas MedicalAssociation multiple times to clarify that a TPA is a third-partyadministrator, not a PPO.

Staying clear for clients

Even third-party administrators who vow to use only widelyunderstood acronyms around clients and employees can findthemselves misunderstood. That's because it's often difficult toknow which acronyms a particular audience understands, and evenharder to know whether their particular translation of that acronymis correct.

“It's common during a meeting with a prospective employer orduring enrollment meetings for a question to arise that requiresmore explanation in order to be clear,” Entrust's Jacobson says.“For example, a PPO is a preferred provider organization, otherwiseknown as a network. But some clients think the PPO is their plan.That's an example of how an acronym can confuse an end user.”

The distinction can be legally important, Davis says, notingthat the right word might affect how contracts are written.

“Using the word the customer understands can be important, butdepending on the situation, you may also need to do some customereducation,” she says.

Glossaries help, particularly as part of material that peoplecan later read on their own. But glossaries do little to helpduring live presentations. Some clients, like many benefitsprofessionals, will ask for clarification when they hear anunfamiliar acronym. Others, however, never speak up.

“I've done seminars where a colleague has noticed that someone'seyebrow is raised and they have no idea what's going on,” Davissays. “I go back and explain.”

Many bright people simply aren't familiar with benefits industrylingo, and some may not feel comfortable interrupting apresentation or conversation to get more information. “We deal withmany people who don't have access to some of the education thatothers might have. Our clients and participants are doingeverything, including cleaning lumberyards and houses. We need tobe sensitive to their ability to understand what you're talkingabout and encourage questions,” Grooms says.

Sometimes that means thinking hard about potentially unfamiliarterms.

“Someone once didn't understand what the ID in ID card stoodfor,” Grooms says.

In addition to trying to correct misunderstandings as theyoccur, Jacobson and other members of the Texas Association ofBenefit Administrators and Society of Professional BenefitAdministrators work directly with the regulators, medicalassociations, and lawmakers who often create benefits industryacronyms in the first place. “We work behind the scenes on aregular basis to clarify and define our roles, and we specificallytry to stay away from acronyms,” Jacobson says.

In the end, Jacobson says, benefits professionals have to takeresponsibility for making sure colleagues, clients, employees, andother audiences understand them.

“We need to do whatever necessary to clarify what we mean,” shesays. “The clearer we can be, the better the health care marketwill be.”