How does a POP work?

Premium Only Plans are self-administered by the employer. The employer adds a section 125 premium only deduction code to their list of payroll deduction codes. The employer keeps good records of employees that are participating in the plan, and keeps a set of plan documents.

The employer then takes the cost of insurance premiums that are deducted from the employees' paycheck on a pre-tax basis. Some types of insurance premiums that can be run through a Premium Only Plan are group medical insurance premiums, dental premiums, vision premiums, disability premiums,  prescription drug premiums.

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