If a group medical plan says they pay 75% of employee and 50% family how is that calculated?

[yorkriver1]

Having a discussion with a new partner in group plan admin.
The employer has had the following and the new partner says otherwise:
me:
take the employee only rate at 75%
subtract the full employee rate from the full family rate
Take the remaining balance for dependents at 50%
Add the two numbers together for the payroll deductions.
My new partner says just take each rate other than employee only and calculate the whole thing at 50%
That will increase the cost for family coverage, EE/spouse/EE/children for employees if this change is made.
Norms? if any?

 

[Lee Vena]

Been doing group for 41 years and your statement confused me greatly. Your question is missing some important information. You say the employer pays 75% of employee and 50% family, but family what? Is it the full family premium rate or is it the incremental cost above the EE premium rate? My guess is that it is the family premium, not the incremental increase. If so, the employer pays 75% of the EE rate, and 75% of the family premium rate. By way of example, EE is $600 and Family is $2,400. Employer funds 75% or $450 for EE and $1,800 for Fam.

If not, then the employer pays 75% of $600 for EE's and 75% of $1,800 (incremental difference) for the family unit.

Does this help?

 

[LilyBrown]

Thanks for the explanation.

 

[yorkriver1]

To clarify, the team working on the account made the calculations work same as last year.
The app for the employer for the 50-100 size had an explicit fill in for employers contribution:
employee: _75___% dependent cost __50___%
So that's how it was calculated.
I am told this is not how many groups do the calculation, but this one does.
Note: in other words, the whole cost for employee and dependents in each category had to be broken down by subtracting the employee only cost, then 50% of the remainder added to the 25% the employee would pay, mirror, the employer paying 75% of employee on all tiers, then 50% of dependent cost.
In a side note, the way the mid size group rates were calculated at the carrier, the single parent + dependent rate was a goodly amount lower than last year, a big relief for the single parents.