Employer Defined Contribution

What is a Defined Contribution and Why Should I Offer It?

A New Trend

You as the employer can define a specific contribution dollar amount that becomes the benefit, letting your employees spend the defined benefit how they see fit.

How does this work?

With a defined contribution, your out of pocket expenses are controlled.  You define a fixed contribution amount.  This gives the employee the ability to choose the benefits that are important to them.

With the assistance of a Third Party Administrator, the employer is assisted in organizing the defined contribution by using an online administrative platform.  The employer decides an amount to “contribute”.  The employer is assisted in setting up the online portal the employees will visit.  The employees then visit the portal online to spend their defined contribution on the benefits they want to have.

Employers are now beginning to allow their employees to shop for their own health insurance coverage so the employees don’t just have 1 or 2 plans to choose from.  Instead, they define a contribution amount and allow their employees to choose which benefits they want.  The contribution in a specific dollar amount becomes the benefit, and the employees (with guidance from a licensed agent) can then go to a private exchange and shop for the best plan themselves.

Choice is a key component of a defined contribution strategy.  Employees will need to have access to plans that have government subsidies, along with the private “off exchange” plans, plus supplementary benefits such as dental, vision and life.  This option allows the families to control and choose what’s best for them.

Three Ways to Enroll

1).  Apply by Phone

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2).  Apply in Person

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3).  Get a FREE quote

Benefits to the Employer

♦ Get out of the insurance business

♦ Reduced Administration costs

♦ Simple Renewal Process

♦ Manage contributions and payroll deductions through an online portal

♦ FICA savings

Benefits to your Employees

♦ All Nevada health plans and metal tier levels available, with/without Government Subsidy

♦ Licensed Private Exchange Agents assisting your employees

♦ Employees manage their benefits

♦ Access tax advantaged plans like HSA’s and FSA’s

♦ Easy access to defined contribution account online anytime

♦ FICA/FUTA Savings Plus Income Tax Savings

Employers are looking for ways to control their costs, and by “defining a contribution” instead of defining benefits (typical group insurance) it allows employers to have a pre-calculated budget for their employees’ benefits plans.  This allows the employer to get out of the benefits business and get back to running their own business.

Think of the Defined Contribution as giving them a gift card to spend on benefits, instead of choosing their benefits for them with group insurance.  And when you compound that benefit to the employee receiving a subsidy from the government, the benefits stretch that much farther.  Some of your employees may even qualify for the “Cost Sharing Reduction” benefit which is in addition to the APTC “Advanced Premium Tax Credit.”  This is dependent upon their federal poverty level.

Get out of the Insurance Business by “Defining a Contribution”

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