What if you could offer your employees’ the tax benefits of group health insurance without any of the headaches or costs?
Well you can! No need to pinch yourself, you aren’t dreaming… this is REAL! It’s called the Health Care Reimbursement Plan (HCPR Plan). It came out in the 2009 legislation and falls under the Premium Only Plan (P.O.P).
With HCPR employees can have individually owned healthcare premiums deducted from their paycheck on a pre-tax basis. HCPR is designed as an alternative to group coverage. So, let’s get down to the good stuff…. your benefits as an employer. Your benefits include (but aren’t limited to) the following:
- Tax advantage– Don’t pay Medicare, Social Security, or unemployment insurance taxes on the amounts that employees choose to have withheld from their paychecks on a pre-tax basis.
- Fixed benefits costs = control and predictability
- Easy and inexpensive set up
- Better employee retention– you can offer better coverage and more affordable choices!
- Healthier employees! Studies have shown will quit smoking, improve their dieting habits, or start working out in order to lower their own health premiums. This probably means your employees will be using less of those sick days!
- Individual plan = portability. It is the employees plan even if they switch employers, which means you don’t have to worry about COBRA
Now why is Compass-i, a human resource and payroll company, blogging about healthcare?! Several reasons…
- We are responsible for setting up the plan documents. Compass-i works with you and your insurance broker during the enrollment process and completes your HCPR Plan documents.
- We can administrate the HCPR plan through your payroll so you and your employees get the appropriate tax benefits your plan provides.
- A lot of health insurance providers, larger payroll firms and third party administrators (TPAs) aren’t really that interested in supporting HCPR because there is more money in large group plans, but Compass-i is always looking for the most cost-effective solution for our clients.
Thanks for reading! Until next time…
Compass-i. “Giving Direction. Pointing to Solutions.”