POP Plan self-insured?

[Guest Carolyn Barnard]

I've never been clear on this. Is a "Premium Only Plan" (POP) only considered a POP when there are actual pre-tax insurance premiums through an insured product, or can the benefit funded through the POP plan be self-insured as long as it's an employer-sponsored group benefit?

[Chaz]

In general, a POP plan exists to permit participants to participants to pay for qualified benefits on a pre-tax basis. It doesn't matter whether the qualified benefit is self-insured or fully insured.

[Guest Carolyn Barnard]

I thought that's how it worked, but the word "premium" throws me and I've also seen guidance both ways from different practitioners via the internet. Scary.

[QDROphile]

POP is just slang. Slang is not precise and often does not have an accepted meaning. Don't use it and there is nothing scary about it. Sloppy use of language is often associated with sloppy learning and sloppy thinking. If someone is relying on slang to communicate something important, or to sell you something, you need clarification.

Hold on to your hat: "pre-tax" is also slang and the use of the term is behind a lot of misunderstanding.

[Guest Carolyn Barnard]

OK, I guess I need more help. Self-insured or fully insured? Employee $$ only or Employer & employee $$ OK? Again, I've seen it both ways. Is a "POP" plan just the simplest version of a cafeteria plan?

[Chaz]

A POP is the term that is sometimes used for a cafeteria plan that is in place just to permit employees to pay their portion of the premium pre-tax, so, yes, a POP is simple cafeteria plan (as compared to other cafeteria plans that offer FSAs and other benefits).

As I stated in my earlier post, it doesn't matter if the coverage is self-insured or fully insured (in the self-insured context, an employee contribution is still a "premium"; it just goes to the employer rather than an insurer).

It also doesn't matter if the employee is paying the full boat (as is sometimes the case with dental and vision coverage) for the coverage or the employer contributes a portion.

Does this make sense?

[Guest Carolyn Barnard]

Compeltely. Thank you.