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Consistent EE Health Benefit Premiums
Benefits & Compensation
Consistent EE Health Benefit Premiums
Exchange ideas about health plans, retirement, work/life benefits, and employee assistance.
Is there any legal requirements around the issue of the employee paid portion of the health benefit premium being consistent between employees? For instance, can the ER pick up a different portion of
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Forums » Topic Forums » Benefits & Compensation » Consistent EE Health Benefit Premiums
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Consistent EE Health Benefit Premiums
posted at 8/17/2011 1:01 PM EDT
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Posts: 4
First: 11/20/2009 Last: 8/17/2011 |
Is there any legal requirements around the issue of the employee paid portion of the health benefit premium being consistent between employees? For instance, can the ER pick up a different portion of the cost for employees at different locations (we already do this)? Within the same location (we'd like to do this)? Setting aside the internal equity question, some managers are symphetic to differnt employees individual circumstances, and would like to "help them out". Is this legal? Or does it have to be couched in terms of a salary level, etc? |
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Consistent EE Health Benefit Premiums
posted at 8/17/2011 4:55 PM EDT
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Posts: 562
First: 11/12/2009 Last: 9/14/2011 |
You may run into problems with your SPD (summary plan description). Check it first.
But your biggest liability might be in discrimination. Older men get more of their premiums paid that young women? Gender discrimination suit. Hispanics getting more paid than whites? Another lawsuit. Use an objective measure such as pay grade or FLSA status if you're going to do this. Don't do it by individual. And even if you do it, you might want to get a legal opinion. |
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Consistent EE Health Benefit Premiums
posted at 8/18/2011 1:00 PM EDT
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Posts: 1047
First: 4/11/2002 Last: 9/14/2011 |
So long as you can class it out (location, exempt vs. non-exempt, hourly vs. salary, etc.), you're fine. Paying more for employees in the same classification is a no-no per Section 125. |
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Consistent EE Health Benefit Premiums
posted at 8/19/2011 5:44 AM EDT
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Posts: 2146
First: 2/15/2006 Last: 9/14/2011 |
Agree that you can set up classes, but you still need to make sure there is NOT disparate impact That is that you aren't unintentionally discriminating. If you do it on pay grade/level, you might find that your older employees are being required to pay more than younger. Or if you have more high level men than women, some thing. So you need to review your classes carefully.
And I agree, you do NOT want to do it based upon the individual. That is way too inconsistent and can easily lead to a discrimination issue! |
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Consistent EE Health Benefit Premiums
posted at 8/31/2011 10:02 AM EDT
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Posts: 1
First: 8/31/2011 Last: 8/31/2011 |
Don't forget the PPACA non-discrimination rules in effect after 3/23/10. If your health plan is grandfathered, you would lose grandfathered status. You also want to make sure that premiums cannot be tied in any way to health status. Here is the code section - http://webapps.dol.gov/federalregister/HtmlDisplay.aspx?DocId=23983&AgencyId=8&DocumentType=2. |
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Re: Consistent EE Health Benefit Premiums
posted at 10/19/2011 1:19 PM EDT
on Workforce Management
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Posts: 1
First: 10/19/2011 Last: 10/19/2011 |
In Response to Consistent EE Health Benefit Premiums: Don't forget the PPACA non-discrimination rules in effect after 3/23/10. If your health plan is grandfathered, you would lose grandfathered status. You also want to make sure that premiums cannot be tied in any way to health status. Here is the code section - http://webapps.dol.gov/federalregister/HtmlDisplay.aspx?DocId=23983&AgencyId=8&DocumentType=2. Posted by rdoug732 You also need to take into account if the employees are highly compensated versus non highly compensated, always a consideration. |
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Re: Consistent EE Health Benefit Premiums
posted at 10/24/2011 3:00 PM EDT
on Workforce Management
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Posts: 13
First: 10/24/2011 Last: 8/22/2012 |
Whoever administers your Section 125 plan would be able to perform discrimination testing in regards to HCE's. Whether or not you decide to keep your plan grandfathered or not is something to consider as rdoug pointed out, however, virtually every plan is going to be non-grandfathered down the road. So that shouldn't be the sole factor when deciding to make any contribution changes. |
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