After-tax LTC insurance in cafeteria plan

[Guest Cindyd]

I understand after HIPAA that cafeteria plans cannot include LTC insurance as a qualified benefit. However, are employers allowed to included LTC insurance on an after-tax basis in a cafeteria plan, as a type of taxable benefit, treated similarly to cash?

[This message has been edited by Cindyd (edited 01-21-99).]

[SLuskin]

Actually, LTC policies were always prohibited from Cafeteria Plans. After Congress/IRS decided that they would give the LTC plans tax qualification, they just restated that "LTC Plans can still not be a part of a Cafeteria Plan". Therefore, I would not put it in, even as a taxable benefit. It can be offered on a group basis outside of the plan just like UL should be offered outside the plan. The Benefits and Health Insurance lobbies are working on this issue.