Benefits

Understanding practice perks

An introduction to employee benefits.

Gina Kaspar, Incline Village, Nev.

As is the case in business, medical practices generally offer competitive benefit packages to attract and retain talented employees. Upon hire, an employee is provided information about the company’s benefits. A meeting with management usually follows, during which all options in the package are discussed. After the meeting, employees often have additional questions regarding how to take full advantage of the offering.

Interpreting employee benefits can be complicated and each component could be subject to federal or state laws and mandates. Should an employee have specific benefit questions, they should speak to their manager, seek professional counsel, consult with their tax advisor or contact their insurance provider.

While benefits vary from practice to practice, this article identifies several of the most commonly offered benefits and provides details that might help employees decide which options are right for them.

Medical, dental, and vision insurance

Medical, dental, and vision insurance plans are, by far, the most commonly offered benefits in today’s workplace. These plans usually are offered to full-time employees and qualified part-time employees (meaning the employee meets the minimum hours worked criteria for eligibility). While some employers cover the cost of the employees’ insurance, other employers ask staff members to pick up a portion of the costs through a payroll deduction. Plans vary, and the employer determines the selection of plans.

Health plan varieties

Some of the more common offerings for insurance may be a health savings account (HSA) accompanied by a high-deductible insurance plan, a health maintenance organization (HMO) plan or, most commonly, a preferred provider organization (PPO) plan. PPO plans work with preferred provider networks. Doctors and facilities included in PPOs consent to offer services at an agreed-upon, contracted amount. PPOs usually have an in-network doctor visit co-pay. PPO plans also often offer specialist co-pays as well, but those co-pays tend to be higher. The co-pays do not apply to the member’s annual deductible. A deductible means that a member must pay the in-network or out-of-network amount before qualifying for the coinsurance benefit. This deductible is set when the plan is established. Once that is met, coinsurance is applied. The coinsurance pays a determined percentage of costs and the member picks up the difference until the maximum annual out-of-pocket limit is met. PPO plans also allow members to visit out-of-network doctors, but the fees and rates are higher. Normally, out-of-network doctor visits do not have copays; the cost of the visit is paid for by the member and applied towards the deductible.

Retirement planning

Some employers offer retirement benefits to their employees in the form of a 401k plan. The 401k plan is set up by the employer. Employees can add money to their retirement account on a pre- or post-tax basis, depending on the plan. Employers may match contributions made by the employee up to a certain percentage of the employee’s salary. 401k plans come in many varieties.

In the event a retirement benefit is not offered, an employee may choose to open an individual retirement account (IRA) such as a traditional IRA or a Roth IRA. Funds invested in an IRA grow in the account without yearly tax implications. The main difference between these IRAs is the time at which taxes are paid. For traditional IRAs, taxes are paid on the entire amount when the funds are drawn from the account. With Roth IRAs, taxes are paid at the time the contribution is made and not when funds are drawn. Traditional IRAs require account holders to begin withdrawing from the account at a certain age; Roth IRAs are more flexible. Each type of IRA has a different requirement for how long the monies can remain invested in the account. Employees should check with a tax advisor to determine the best scenario for their needs.

Bonus plans

In many cases, bonuses or company profit sharing are offered in lieu of a 401k plan. Bonuses are not always guaranteed, as they are often tied to the well-being of the company’s balance sheet. If an employee anticipates owing taxes at year-end and is expecting a bonus, they may want to consider working with the payroll department to see if the bonus can be applied toward paying federal taxes.

Flex-spending accounts

Some employers offer flex-spending accounts, which help with other out-of-pocket medical expenses such as chiropractic care and hearing aids. It also can be used to pay for child-care costs.

Understand the details

Employer-sponsored benefits are nearly as important as an employee’s rate of pay. Understanding the details of one’s benefit package can have a direct impact on work satisfaction, retention and ultimately, quality of patient care. OP

Gina Kaspar is the Human Resource Manager for BSM Consulting located in Incline Village, Nev. She can be reached via e-mail at gkaspar@bsmconsulting.com.