Benefits Outsource has simplified managing your Section 125 plan. As an expert in administering the Section 125 plan, otherwise known as the Cafeteria Plan, Benefits Outsource provide clients with a cost effective initiative for outsourcing their Section 125 administration.
When outsourcing with BOI, not only will you be able to devote more time to your company’s growth and profitability, but you would also effectively rid your company of any potential liability that could result from non-compliance.
Let us carry the administrative burden for your company’s SECTION 125 PLANS.
Section 125 – Cafeteria (Flexible Spending Account) Administrative Services Includes:
A. Record monthly payroll deductions received via automated system and maintain by participants’ account through secured web site.
B. Perform monthly reconciliation and maintenance of participants’ account.
C. Process qualifying/eligible expenses for reimbursement; prepare and mail disbursement checks or direct deposit into participant checking or savings account weekly.
D. Checks are prepared immediately for mailing after processing; direct deposits are in the respective accounts two (2) days after processing. Participants receive statements of account after each reimbursement.
D. Prepare and mail participants’ benefit statements with each reimbursement, as well as prepare and mail reminder statements to participants during the fourth quarter of the plan year. Account balances and activity are also available to participant via secured internet access at mbicard.com.
E. Conduct annually or as requested, comprehensive orientation/presentation to educated employees of benefits.
E. Provide open enrollment assistance as needed; as well as provide enrollment material for employees. (There is no minimum participation requirement).
- Provide enrollment and claims reimbursement forms, which can be loaded on the City’s on-line portal for employee convenience or accessible by BOI online Website.
G. Respond to employees’ inquiries via website or local or toll free telephone numbers.
H. Provide monthly summary report of all participants’ balances, as well as individual statements quarterly, to include detailed pay period contributions and disbursements. Prepare any additional reports as requested by management.
- Initial Plan Design and Setup
- DCA /FSA/HRA/HSA Administration
- Plan Documents and Amendments
- Debit Cards Issuance
- Reconciliation and maintenance
- Participant Reimbursements
- Provide on-line Access to clients with the ability to:
Run reports
Check balances
Funding/Contributions
- Monthly Reporting
- Statements & Account Balances
- Non Discrimination testing
- Compliance with Government Regulations (ERISA)
- Customer Support Helpdesk
Employers Guide:
Plan Definition:
A Section 125 Cafeteria Plan is a non-discriminatory written plan where all participants are employees of the sponsoring organization, and which offers the choice between two or more benefits consisting of cash or certain non-taxable benefits. The components of a Section 125 Cafeteria arrangement are:
- Premium Only Plan:
Allow employees use of pre-tax dollars to pay insurance premiums.
- Health Spending Flexible Arrangement:
Allow employees to use pre-tax deductions or employer credits to pay for un-reimbursed, out-of-pocket medical, dental and vision expenses not covered by your group health plans.
- Dependent Care Flexible Spending Account:
Allow employees use of pre-tax deductions or employee credits to pay for certain dependent care expenses.
- 401(k) and other Qualified Plans :
Allow employees use of an employer to set aside a portion of their current taxable pay to tax-sheltered retirement fund.
What are your responsibilities as Sponsor of a Section 125 Plan?
The employer or business sponsoring a Section 125 Plan has ongoing responsibilities for the Plan’s operations. As Plan Sponsor, you are charged with the responsibilities to establish, maintain, and operate the plan in accordance with the law and IRS rules and regulations. This means that your Section 125 benefit plan must be tested in each year to ensure that it is not discriminating in favor of highly compensated or key employees. The safe approach to meeting the technical difficulties inherent in the regulations is to engage a Third Party Administrator to handle every aspect of your plan administration. This is where BENEFITS OUTSOURCE, INC. can help.
For information on how Benefits Outsource, Inc. can assist you with your Section 125 administrative needs, please click here or call to speak to a benefits expert at (888) 877-2780.
Section 125 Helpful links: