The Pre-Tax PlaybookThe employer's briefing on Section 125 benefits
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For HR & recruiting

The first benefit they'll actually use.

For the people your medical plan doesn't reach, and the ones it doesn't reach far enough.

Illustrative photo · not a real employee

Required federal noticeFixed indemnity insurance

IMPORTANT: This is a fixed indemnity policy, NOT health insurance

This fixed indemnity policy may pay you a limited dollar amount if you're sick or hospitalized. You're still responsible for paying the cost of your care.

  • The payment you get isn't based on the size of your medical bill.
  • There might be a limit on how much this policy will pay each year.
  • This policy isn't a substitute for comprehensive health insurance.
  • Since this policy isn't health insurance, it doesn't have to include most Federal consumer protections that apply to health insurance.

Looking for comprehensive health insurance?

  • Visit HealthCare.gov or call 1-800-318-2596 (TTY: 1-855-889-4325) to find health coverage options.
  • To find out if you can get health insurance through your job, or a family member's job, contact the employer.

Questions about this policy?

  • For questions or complaints about this policy, contact your State Department of Insurance. Find their number on the National Association of Insurance Commissioners' website (naic.org) under "Insurance Departments."
  • If you have this policy through your job, or a family member's job, contact the employer.

The recruiting moment

A benefit you can say out loud in the interview.

When someone quits for a dollar more an hour, it costs about 40% of a frontline salary to replace them.[100] Employers rank health benefits as the single most important category.[101] This one is built for frontline pay: a doctor by phone any hour, $0 copay, for the family — and take-home that can go up, not down.[21, 37]

Say: “pre-tax supplemental hospital coverage with $0-copay virtual care.”
Don't say: “free,” “wellness,” or “get paid to be healthy.”

A young employee on a video counseling call in her car
Nearly half of adults with mental illness get no treatment. $0-copay virtual behavioral health changes the first step.

What it takes to run

The work for HR and payroll.

  1. Set up the pre-tax deduction and an earnings code; pass through the carrier's claim payments and report them on the W-2.[32]
  2. Employees get notice and an easy opt-out.[45]
  3. Section 125 plan document and SPD — provided per Elysian; ask to see them.[46, 54]
  4. Only W-2 employees participate pre-tax; Elysian screens for about $240+/week.[43, 44]

Without it

  • Turnover you can't backfill fast enough[100]
  • Hourly staff who decline the medical plan as too expensive[94]
  • People working sick[96]

With it

  • Something every eligible W-2 employee can use[21, 22, 23]
  • A paycheck-level reason to stay[37]
  • Members' tax advice line for questions[27]
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