W-2 Health Insurance Reporting

[Guest RuthBH]

Hi -

We offer our employees self-insured medical plans. For 2011 tax year, we will have to report the value of the team member's health insurance coverage on the W-2. Easy enough. However, my quesiton is this... if we were fully-insured, that would involve providing the employer's portion of the full premium. But, we're self-insured. So, do we simply report the employer's portion of the COBRA equivalent or do we need to get deep into the bowels of the plan and determine the amount the company truly paid for the plan (claims, admin fees, etc.) and then divvy up accordingly? I'm assuming (and hoping) it's the former, not the latter.

Thanks.

[Guest jims]

A lot of the current thinking has people using the employer portion of the COBRA equivalent like you said. That would be quick straight forward method. That assumes your self-insured rates are set accurately and covering your costs. It seems the more you think on it, the harder it gets. But ultimately more guidance will be needed - so you're a little early on this.

[GBurns]

Your COBRA premium should be a reflection of the costs of providing the health coverage and therefore should include all costs including claims, administrative fees etc etc.

[Guest RuthBH]

Thanks to both of you.

We're trying to get this plotted out so we can implement as quickly as we can in January, in case we have any terminations early in the year that want a copy of their W-2 right then. (Doesn't happen much at all, but knowing our luck...!)

Thanks again!

[lvena]

Just a quick thought, and it may not be much of an impact, but you may need to calculate the value without the employer administrative load on the cobra rates. With so much unknown still out there, it seems to me that the term "value" will be defined along the lines of the actives costs. Just a thought.