Plan design

[Guest pinsall]

Can one design a 125 plan as such

Employer will pick up 75% of benefits selected

Benefits offered medical, medical FSA & dependent care FSA

If ok, does anyone see any problems with this design?

Much thanks

Pat Insall

[Joe Priselac]

As long as the credit strategy is implementedon a nondiscriminatory basis, there is no problem. You should have no problems with your approach if everyone gets the same credits.

[Guest pinsall]

Thanks Joe for your responses.

A follow to this thread---

I am fairly a newbie to flex ben design, having only dealt mostly with simple POPs and a few with health FSA & dependent care FSA all ee paid

This concept of credits is new to me

In my example the employer will pay 75% of medical premium elected so if person chooses indemnity plan, er is actually paying a higher dollar amount for that selection and if monhtly amount is 100 er will pay 75

If ee chooses $ 100 per month to go to FSA er will contribute 75 toward that

same for dependent care

There would be a total overall monthly cap of $ 200 that employer will pay.

Someoen could potentially not choose anything or I gues that get $ 200 /month in cash?

A draw back I see in medical part is that er is funding more of the higher cost plan $wise

Thanks

Pat Insall, CPC

[Guest Lee Ann Jenkins]

Sounds to me like your er just needs to lay down $200 on the table and let employees choose what they want. I'd ask for proof of other coverage if they opt out and I might even force any leftover to go into a medical FSA just to be safe. He doesn't "have" to let it go back in the paycheck.