Employer Contributions

saieddie · 09-04-2008, 09:37 AM

Does anyone know if an employer can change what they contribute for benefits in the middle of the year?
(ie, has paid 100% of health premiums all year, but has decided to make employees pay 50% in the middle of the year - and no, its not open enrollment)

moonlightandmargaritas · 09-04-2008, 09:44 AM

Originally Posted by saieddie

Does anyone know if an employer can change what they contribute for benefits in the middle of the year?
(ie, has paid 100% of health premiums all year, but has decided to make employees pay 50% in the middle of the year - and no, its not open enrollment)

I don't see any reason why not. Their employee morale will be shot though...

somarco · 09-04-2008, 09:57 AM

Participation may be affected as well. Especially if the plan allows off-anniversary drops.

ABC · 09-04-2008, 02:08 PM

The employer can do that.

Employers are hurting so they want to cut costs any way they can.

A good way to offset costs for the employer is to run a dual option plan. Have a base plan that the employer will pay X% and then the employee can buy up for the richer plan.

Labman · 09-04-2008, 08:03 PM

Or maybe the employer could get a higher deductible and still be able to afford a product like Colonial's Medical Bridge 3000 to fill the gaps.

We've gotten some business unde the above scenario.

moonlightandmargaritas · 09-04-2008, 08:13 PM

Originally Posted by ABC

A good way to offset costs for the employer is to run a dual option plan. Have a base plan that the employer will pay X% and then the employee can buy up for the richer plan.

This sounds like a very smart solution...

ABC · 09-05-2008, 11:09 AM

Originally Posted by Labman

Or maybe the employer could get a higher deductible and still be able to afford a product like Colonial's Medical Bridge 3000 to fill the gaps.

We've gotten some business unde the above scenario.

I have used this approach before. I sold it as a voluntary product for the employees.
Sometimes I think the employee is better off putting the money in the HSA account instead of electing a "gap type" policy.

Executive Benefits · 09-05-2008, 12:00 PM

Originally Posted by ABC

A good way to offset costs for the employer is to run a dual option plan. Have a base plan that the employer will pay X% and then the employee can buy up for the richer plan.

I second that, all my clients LOVE this option, and it gives the employee more cost control