Group Plans at EBG

Executive Benefit Plans, Qualified Retirement Plans, International Plans

Group Plans

Medical
Health Maintenance Organization (HMO)

Lower in cost than PPO or Indemnity Plans
No deductible, only co-pays for service
Routine physicals and preventative care usually covered
No flexibility - use only prescribed doctors and hospitals
No out-of-plan reimbursement

Point of Service Plan (POS)

Lower in cost than PPO or Indemnity Plans
No deductible in network, deductible applies for out of network services
Co-pays for service in network, deductible applies plus co-insurance for non-network
Routine physicals and preventative care usually covered in network only
Must use only prescribed doctors and hospitals to receive highest benefit
Out-of-plan reimbursement usually lower than that of Indemnity or PPO

Preferred Provider Organization (PPO)

Moderately priced, usually between HMO and Indemnity Plans
Minimal deductible and co-pays in network
Flexibility--point of service decision to use network physician or your own
Out-of-plan reimbursement paid at usual, customary and reasonable (UCR).

Indemnity Plan

Highest premium cost to employer
Employees share cost in deductibles and co-pays
Physicals and routine care usually not covered
Total flexibility--Choose any doctor or hospital

Dental

Dental Maintenance Organization (DMO)

Lower in cost than PPO or Indemnity Plans
No deductible for service
Co-pays for service only
No flexibility--Use only prescribed dentists
Usually least costly option

Dental Preferred Provider Organization (PPO)

Moderately priced, usually between DMO and Indemnity plans
Higher level of benefit if a PPO dentist is used
Benefits in plan typically offer 100% for preventative care; 90%--Basic care; and 60% major care
Flexibility--Point of service decision to use network dentist or your own
Recommended if employees contribute to cost, but want flexibility to choose provider
Out-of-plan reimbursement paid at usual, customary and reasonable (UCR)

Dental Indemnity

Highest premium cost to employer
Employees pay annual deductibles, i.e. $50 or $100
Services generally covered as follows: 100%--Preventative care; 80%--Basic care; 50%--Major care
Annual maximums range from $1,000-$1,500 - Total flexibility--You choose any dentist, anywhere, anytime.

Life

Group Life Insurance

Group Life Insurance is an employer provided benefit that pays the beneficiary of an employee a fixed sum at the death of an employee. Generally, the premium paid by the employer for this benefit is deductible. The Internal Revenue Service has 4 guidelines that employer provided life insurance must meet in order to be considered Group Life Insurance:

The plan must provide a general death benefit which is excludable from income;
It must be provided to employees as compensation for services performed as an employee;
The insurance must be provided under a policy carried directly or indirectly by the employer; and
The amount of insurance provided to each employee must be computed under a formula that precludes individual selection of such amounts.

Employers are given wide latitude in how these plans are set up. For example, an employer can select a flat amount, i.e. $50,000 per employee, or a multiple of each employee's salary, i.e. 1 or 2 times base salary up to a maximum amount.

Disability

Group Long Term Disability

Group Long Term Disability (LTD) is an employer provided benefit that is designed to assist an employee in replacing income lost as a result of a disability. The method in which most insurance companies use to calculate the percentage of replaceable income usually falls in the range of 60% of gross income. The goal being that the LTD plan is designed to replace a portion of an employees lost income that is close to the employee's after-tax take home pay. The following are some provisions that make up the bulk of a Long term Disability contract.

Maximum Covered Salary- This is determined by the employer and the total volume of salary of the employees in the company.
Elimination Period- This is the amount of time that must pass before a disabled employee becomes eligible for benefits. This can be anywhere from 30 to 180 days.
Duration of Benefits- This represents how long benefits will be payable, i.e. to age 65, or standard retirement age.
Own Occupation Protection- This feature ensures that if an employee is disabled, and cannot perform the material duties of his or her own occupation that they were trained for--they will still be considered totally disabled. This can be as short as 2 years or as long as standard retirement age (ADEA).
Conversion Privilege- The policy can be converted to an individual policy if an employee changes jobs.
Residual Disability - If an employee is disabled and then returns to work, and experiences an earnings loss of 20% or greater, the employee will still receive a benefit to offset this earnings loss.

Please note that this is a partial list of some of the contractual features available in LTD contracts today.

Group Short Term Disability

Group Short Term Disability (STD) is an employer provided benefit that is designed to assist an employee in replacing income, on a short term basis, lost as a result of a disability. The method in which most insurance companies use to calculate the percentage of replaceable income usually falls in the range of 60% of gross weekly income. The goal being that the STD plan is designed to replace a portion of an employees lost income that is close to the employee's after-tax take home pay. The following are some provisions that make up the bulk of a Short Term Disability contract.

Maximum Covered Salary- This is determined by the employer and the total volume of salary of the employees in the company.
Elimination Period- This is the amount of time that must pass before a disabled employee becomes eligible for benefits. This can be anywhere from the 1st day of disability to the 30th day.
Duration of Benefits- This represents how long benefits will be payable, i.e. 4 to 26 weeks.
Residual Disability- If an employee is disabled and then returns to work, and experiences an earnings loss of 20% or greater, the employee will still receive a benefit to offset this earnings loss.

Please note that this is a partial list of some of the contractual features available in LTD contracts today.

"Cafeteria" Section 125 Plan

Cafeteria plans also described as "flexible benefit" plans, allow participating employees to choose between a number of non-taxable qualified benefits or taxable cash. Plans typically offer participants a "cafeteria" menu of items including group term life insurance, medical expense insurance, child care expenses and dental care expenses. An employer who establishes such a plan realizes reductions in FICA (Federal Insurance Contributions Act) and FUTA (Federal Unemployment Tax Act) taxes and the expansion of employee benefits, and enhanced employee appreciation of the benefit package.The benefits to the employee are: the opportunity to select benefits most suited to individual needs; to pay for these benefits with before-tax rather than with after-tax dollars; to obtain benefits which may not be available for individual purchase; and to pay less FICA taxes by reducing taxable income.