Cafeteria Plans

Cafeteria Plans include an annual election which is an opportunity to sign up for benefits. Both health and dependent flexible spending accounts must hold an open enrollment because the IRS sets the benefits to a calendar year. Other pre-tax benefits such as group medical and the 401K are not tied to a calendar year, though if you want to make changes to your plans, many employers have an annual open enrollment. This annual open enrollment is normally tied to the group medical plan’s policy renewal, which typically is prior to the new year.  It is during this open enrollment you can change variables like spouse and dependent coverage, voluntary benefits, and dropping or adding coverage for health insurance, HSA accounts, group life insurance, and individual insurance. This is a good time to calculate how pre-tax benefits can affect your gross pay and save you money.

To receive the tax savings benefits for a company, that company must:

• Insure that all eligible employees have a chance to enroll either when they become eligible or at the next enrollment period.  This is generally every 6 months.
• The employer must deduct the premiums from the paychecks for the elected services and pay the premiums
• Employers do not contribute to the benefits in any way, they get the tax benefit with the employee when that premium is deducted.

An employee is eligible when

• They have been hired full time approx 36 hours per week
• They get past their probationary period (either 90 days or up to 6 months, depending on the company’s standard)

What we do?

• We come out every 6 months to enroll new employees
• We re-enroll employees every year with the enrollment period listed upon the company’s closing date in our contract
• We take care of the paperwork for the employer regarding the Section 125 questionnaire

Added Benefit

• When an employee signs up for one or more of the products, upon termination, retirement or leaving the company, the policy will be completely portable as they own the policies we will just transfer the payroll deduction to their new employer.  If they retire the Section 125 tax savings benefits will cease.
• Company has NO out of pocket cost
• Employee can choose one or more or no products at all; they just have to be offered the opportunity.  They are only responsible, premium wise, to the products they choose at the agreed premium price.  They can drop a product if things change or add products at the next re-enrollment period.  They get the benefits of a group rate without it being part of a group policy.
• We are available any time up to 9 PM for existing clients to ask questions or for help filing out a claim.