How Does Health Compass Save Me Money?

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The Health Compass Wellness program deductions start with a pre-tax deduction for the Plan premium (SIMERP).

Any non-401k pre-tax deduction – medical, dental, vision, SIMERP, etc – lowers a participant’s SS/Medicare taxable wages.  These taxes are often referred to as FICA. 

An employee’s FICA taxes are matched by their employer and both amounts get forwarded to the IRS.  If an employee’s FICA taxes are reduced, so are the FICA taxes for the employer!  A $100/week reduction in an employee’s FICA wages means the employee pays $7.65 less per week in FICA taxes, and by consequence the employer also pays $7.65 less taxes!

A win for the employee, is a win for the employer!

I thought you said my employees didn’t have to pay for anything?

What we mean by “no reduction in take-home pay”, is that our program doesn’t change the employee’s Net (take-home) Pay when they participate.  The employee receives a Wellness Reimbursement (WEL125) on each paycheck for agreeing to complete 4 Required Wellness Activities in their Health Compass App by the end of their plan year.

This creates the tax savings (Benefit Allowance/Reserves) which the employee uses on the qualified benefits, which may result in an additional deduction. The employee and employer savings also cover our Admin fee that is for the employee’s unlimited access to our medical services.  At the end, those deductions don’t reduce the employee’s Net Pay due to the reimbursement.

I got an invoice from Health Compass AND another benefit carrier. All my FICA savings are going away!

Don’t worry, you still have the same FICA savings per participant we said you would!  The benefit carrier’s bill is for the qualified benefits your employees chose to spend their Benefit Allowance on.  Those funds are already deducted from their pay, and are held in your payroll until the Carrier sends you their bill. 

Health Compass will send you an invoice for the Wellness Program after the month has ended.  This will total the WELSVC fee that was collected in payroll from the employees, plus your employer fee that was built into your savings quote calculation.

The Benefit Carrier and Health Compass are separate, unaffiliated companies, which is why you received two separate bills!

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