Payment of Active Employee Claims

[Guest mwhelan]

How do companies pay for active medical claims? My past experience has been that active medical claims are paid through accounts payable, however, my current employer uses a 501©(9) trust to pay for some of its active employee claims. I'm trying to determine how common is the use of a trust for payment active employee medical claims.

[GBurns]

Some use Trust, some use funds, some use special account and some pay directly from general assets. I do not think that there has been any tallying of who does what when.

Personally, I have only very occassionally seen claims paid through Accounts Payable. Although payment of claims is from general assets, payment is made through an expense account rather than from the Accounts Payable "ledger" which is usually reserved for Vendors.

So maybe the real difference lies in your meaning of Accounts Payable. For example, deductions fron an employee's salary for FICA is kept in what is technically an account payable (and sometimes is titled "FICA Payable") but it is not paid through the Accounts Payable ledger.