For companies who want to offer health insurance as a benefit to their employees, Section 125 premium only plans (POP) offer a viable option. Increases in premiums have made insurance program costs prohibitive for businesses and employees. With more of the burden shifting to employees, enrollment in employer sponsored health insurance has decreased over the last several years. For companies who are looking at their options, they may be comparing POP and cafeteria plans in order to determine their differences.
A Section 125 Cafeteria Plan is a way for companies to offer employees a choice in health benefits. They can offer many different group insurance programs, including term life, health, dental, vision, accident and cancer plans. The employees can select among the offered benefits, similar to menu choices at a cafeteria.
These plans offer more than just the ability to offer health insurance with a side of dental benefits. There is also the ability to pay related expenses with pre-tax funds that are deducted from the employees pay. This makes the money go farther and cover more expenses than employees would be able to afford if the money was subject to payroll deductions.
A Premium Only Plan (POP) is also a part of the Section 125 Program. A POP is a Cafeteria plan; the difference is what employees can do with the money that is deducted from their pay each week.
Many Cafeteria Plans offer the option of a flexible spending account. With this account, the money deducted from payroll can be used later for qualified medical expenses. These expenses include insurance programs, prescriptions, co-pays, eyeglasses, or certain medical procedures.
POP, on the other hand, does not allow for a flexible spending account. The money that is deducted from an employee is only applied to the insurance premiums. Therefore, a POP is a Cafeteria Plan, but a Cafeteria Plan doesn't necessarily have to be a POP.
When a business is deciding on which type of Cafeteria Plan to offer, management may want to consider the needs of the employees. If a company has many older workers or employees with families, a flexible spending account may be an important option for them to help cover out-of- pocket expenses. A small company with many single employees may decide that a POP offers enough coverage for their people.
A POP will help cover expenses for employees and still allows them the ability to select among different benefits. This may help create a benefit package that will entice workers and help a company reduce employee turnover rates.
IRS Section 125 Premium only plans (POP), a tax-free cost saving strategy, provide employers the opportunity to render their sponsored healthcare costs affordable and accessible. Taxfreepremiums provides employers entirely web-based POP support services. With document preparation, automatic compliance updates, and free nondiscrimination testing software, Taxfreepremiums is the premier authority on all premium only plan information, documentation, and services. For more information, feel free to visit http://www.taxfreepremiums.com/
A Section 125 Cafeteria Plan is a way for companies to offer employees a choice in health benefits. They can offer many different group insurance programs, including term life, health, dental, vision, accident and cancer plans. The employees can select among the offered benefits, similar to menu choices at a cafeteria.
These plans offer more than just the ability to offer health insurance with a side of dental benefits. There is also the ability to pay related expenses with pre-tax funds that are deducted from the employees pay. This makes the money go farther and cover more expenses than employees would be able to afford if the money was subject to payroll deductions.
A Premium Only Plan (POP) is also a part of the Section 125 Program. A POP is a Cafeteria plan; the difference is what employees can do with the money that is deducted from their pay each week.
Many Cafeteria Plans offer the option of a flexible spending account. With this account, the money deducted from payroll can be used later for qualified medical expenses. These expenses include insurance programs, prescriptions, co-pays, eyeglasses, or certain medical procedures.
POP, on the other hand, does not allow for a flexible spending account. The money that is deducted from an employee is only applied to the insurance premiums. Therefore, a POP is a Cafeteria Plan, but a Cafeteria Plan doesn't necessarily have to be a POP.
When a business is deciding on which type of Cafeteria Plan to offer, management may want to consider the needs of the employees. If a company has many older workers or employees with families, a flexible spending account may be an important option for them to help cover out-of- pocket expenses. A small company with many single employees may decide that a POP offers enough coverage for their people.
A POP will help cover expenses for employees and still allows them the ability to select among different benefits. This may help create a benefit package that will entice workers and help a company reduce employee turnover rates.
IRS Section 125 Premium only plans (POP), a tax-free cost saving strategy, provide employers the opportunity to render their sponsored healthcare costs affordable and accessible. Taxfreepremiums provides employers entirely web-based POP support services. With document preparation, automatic compliance updates, and free nondiscrimination testing software, Taxfreepremiums is the premier authority on all premium only plan information, documentation, and services. For more information, feel free to visit http://www.taxfreepremiums.com/
