QUESTIONS & COMPLIANCE
Clear Answers.
Structured Correctly.
Employers and employees naturally have
questions when reviewing alternative benefit structures.
This page addresses common topics of program
design, compliance integration, participation,
and implementation.
Frequently Asked Questions
Employer Questions
The program is designed to help employers provide alternative benefit approaches that improve employee access to healthcare-related services while also creating administrative and payroll benefits and savings.
No. The program is designed to work alongside an employer’s existing major medical coverage rather than replace it. Existing coverage remains an important component of the overall implementation model.
The goal is always net-zero cost to employer and employee. Beyond that, most of our employer clients find they actually save significantly in payroll taxes and employees often expereince higher take-home pay. (For more information see questions under Structure & Compliance below.)
Financial impact varies based on factors such as participation levels, existing benefit structure, payroll composition, and implementation design. Because every organization differs, individualized review is important before discussing potential outcomes or projections.
Participation is voluntary. Employees are provided information regarding available participation options and can review how the structure may apply to their individual circumstances before making elections.
Implementation is coordinated through an onboarding process that begins with the employee census provided for the initial proposal. Then, coordination with HR and your payroll service, employee communication, and finally administrative setup. The process varies depending on employer size, existing benefit structure, and operational requirements. The process is handled by the provider you ultimately choose for the service.
Compliance & Structure
The best program employers want to implement involves employee (and family) access to comprehesive medical and wellness services that saves employees money and is easier to access than their regular medical plan. It must be an integrated benefit with existing major medical coverage to qualify under U.S. laws regualting employee benefits.
Certain components of the structure rely on established sections of the Internal Revenue Code commonly associated with cafeteria plans, self-insured reimbursement arrangements, and qualifying medical expenses. Proper implementation and administration are important, and structures may vary depending on employer circumstances. Specific laws and regulations that support the structure are provided at the time of your review and discovery call.
Yes. Employers should always consult with their own legal, tax, payroll, and benefits professionals when evaluating any benefit structure or administrative arrangement. Individual business circumstances and state-specific considerations may affect implementation.
No. Each employer’s existing benefits, payroll structure, workforce composition, and operational setup should be reviewed individually to determine potential fit and implementation considerations.
No two organizations are identical. Factors such as employee demographics, existing benefit structures, payroll systems, participation levels, and operational goals may all influence how implementation is approached.
Yes. Employee participation decisions and related elections are voluntary and are communicated during the onboarding and review process.
No, not at this stage of overview. Potential outcomes vary based on implementation, participation, employer structure, and individual circumstances. Your specific financial and tax-related outcome is detailed when a proposal is developed for your company based on data collected by your advisor.
Potential outcomes can vary significantly between organizations. Public illustrations without individualized review may create misleading assumptions regarding participation, implementation, or employer-specific circumstances.
Implementation, administrative coordination and onboarding are handled by the chosen service provider with employer team's support. Ongoing administration is handled by the service provider. Your payroll team or payroll provider is given all the data needed to comply with payroll policies for the program. Once it's implemented it runs as smooth as any other benefit you provide your employees.
Yes, thats how it is designed. Existing payroll systems, whether in-house or outside services, find the payroll side of the program is easy to admisiter. If you use a PEO, let your advisor know as there needs to be specific type of coordination with the PEO (Professional Employer Organization).
Employee Participation
No. Participation is voluntary and employees are given the opportunity to review available options and related information before making any elections.
Yes. Family members and household dependants are automatically included in coverage in the same fashion as with the employee's major medical plan.
Most employees participating in the program experience no additional out-of-pocket cost while gaining access to expanded everyday healthcare and wellness services that also are available with no deductible or co-pay required. Some employees may also experience increased take-home pay depending on participation, payroll structure, household circumstances, and existing coverage. Individual evaluations are provided before participation decisions are made.
Yes. Existing major medical coverage is required to be kept in place as a compliance feature of the program. However, many choose to switch to a high deductible medical plan if the employer offers it since most of the everyday healthcare needs can be handled through the program with no need to pay deductibles or co-pays.
Employees are typically introduced to the program through an onboarding and communication process designed to explain available participation options, program structure, financial aspects, and benefit access procedures in a clear and organized manner. ESG or the service provider can make the presentation to the employees or coordinate with employer to provide that information.
Yes. Participation decisions are voluntary, and employees may choose whether participation aligns with their individual circumstances and preferences. They may also opt out later after intially participating with no penalty.
Yes. Employees are encouraged to review program information carefully and ask questions during the onboarding and evaluation process.
Because of easier access and financial advantages, many employees switch to using the program healthcare providers and pharmacy as their primary care and move their major medical coverage services to seconday position. Individual circumstances detirmine whether this is the best method of utilizing the program.
Yes. At minimum all laws and regulations in the Health Insurance Portability and Accountability Act (HIPPA) are adhered to by the service provider, the program and your advisor, just as required of all healthcare providers and administrators in the healthcare industry.
Implementation & Support
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Some employers prefer to involve their CPA, attorney, consultant, HR leadership, or other professional consultants before making decisions.
Learn how Employer Strategy Group approaches independent review and evaluation before recommendations are made.
