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What are Cafeteria Plans

A cafeteria plan, often tied to an , is a benefits structure that lets employees choose from a menu of benefit options. Think of it like walking into a cafeteria: you pick what works for you; health, dental, vision, etc., all in one structured program.

Although Section 125 is a part of the IRS code that regulates these plans (125 cafeteria plan IRS), Core360 goes beyond this. It combines a Preventative Care Management Plan (PCMP) and a Self-Insured Medical Reimbursement Plan (SIMRP), thereby making sure that the employees are able to get preventive health services, family coverage, and high-value perks at no cost to their take-home pay.

Key Features Include:

  • Wide-ranging benefits options which include health, vision, dental, and prescription coverage.
  • Integration with mental health and counseling programs.
  • Family-first benefits with coverage for spouses and dependents.
  • 24/7 Telemedicine and Virtual Care access.
  • Group Term Life Plan ($60–100/month), fully included.


By combining traditional Section 125 elements with Core360’s PCMP and SIMRP, employers create a plan that feels personal, flexible, and valuable.

Who Can Benefit From a Section 125 Cafeteria Plan?

Cafe 125 deductions are not solely meant for large corporations; they are advantageous for all companies, no matter their size, and for the staff that rely on them as well.

For Employers:

  • Reduced healthcare costs by 5–10% per employee.
  • Average savings of ~$1,100/year per W2 employee.

  • Immediate bottom-line impact with no out-of-pocket costs.
  • Boosted retention and employee engagement through meaningful benefits.


For Employees:

  • 24/7 telemedicine and virtual care with no copays at all. 
  • Support of mental health, counselors, and addiction;
  • Mayo Clinic health tools & wellness dashboards.

  • Family coverage, including spouse and dependents, with 12 annual care visits.
  • Group Term Life Plan coverage.
  • No copay for RX coverage, vision, dental, and in-person urgent care.

Health Sphere’s Core360 plan is already attractive to over 35,000 employees, showing that the contemporary workforce is quite receptive to flexible cafeteria-style options.

Benefits of Section 125 Cafeteria Plans for Employers and Employees

Cafeteria plans go beyond savings to a section 125 benefit plan; they create tangible advantages for both sides of the employment equation.

Employer Benefits:

  • Reduced administrative burden thanks to automated, fully managed programs.

  • Lower healthcare claims over time, with predictable cost management.

  • Fast implementation (30–45 days).
  • Strengthened company culture through family-first, employee-centered benefits.


Employee Benefits:

  • Flexibility to choose the benefits that fit personal and family needs.
  • Significant enhancement of net paycheck without affecting take-home pay.
  • Access to a broad range of preventive care and wellness tools.

  • Security from life plan and family coverage is included at $0 copay.


When employers use Core360, they leverage Section 125 with integrated programs to deliver a benefits experience that supports well-being and work-life balance.

What Expenses Can a Cafeteria 125 Plan Cover?

Cafeteria plans are designed to cover a variety of employee benefits beyond standard plan, unlike IRS tax code section 125.

Some common categories include:

  • Health, dental, and vision plans.
  • Prescription drug coverage.
  • Flexible spending accounts for qualifying medical, dependent care, and health expenditures.
  • Telemedicine and online consultations services.
  • Preventive health check-ups and vaccinations - health programs.
  • Support in the form of psychological support and counseling.
  • Life Plan and Disability.

With Core360, these benefits are bundled seamlessly, making it easy for employees to select options that suit their lifestyle while still optimizing cafeteria 125 deductions for the company.

Setting Up a Section 125 Cafeteria Plan

The implementation of a Section 125 Cafeteria Plan requires thorough planning, observance of laws, and communication with the employees. However, Core360 makes it a lot easier by taking over the majority of the steps via automation.

Key steps include:

  1. Assessment of Needs – Get to know your workforce and their preferences regarding benefits.
  2. Plan Design – Select the types of coverage, determine the contribution arrangements, and include family and employee perks.
  3. Implementation – Core360 takes care of the automated onboarding, compliance, and training aspects.

  4. Ongoing Management – Monitoring claims, changing coverage, and offering employees 24/7 support are part of the service.


What you get is a plan that is compliant, fully managed, and at the same time, it ensures maximum savings for the employer and satisfaction for the employees.

What Is Included in a Section 125 Plan?

A well-structured Section 125 plan goes beyond basic healthcare coverage. Core360 from HealthSphere includes:

  • Preventive Care Management Plan (PCMP) is for health monitoring that is done proactively.
  • Self-Insured Medical Reimbursement Plan (SIMRP) provides the flexibility of medical expenditure.
  • Through telemedicine and virtual care, patients receive professional help all day long.
  • Patients are offered counseling and mental health services.


  • Family coverage, including spouse and dependents
  • Life Plan coverage with $0 copays for all included services
  • Access to Mayo Clinic wellness programs and dashboards
  • RX coverage, vision, dental, and urgent care benefits

This combination ensures both employees and employers enjoy measurable, real-world benefits while maintaining compliance and automation.

Bottomline on Cafeteria 125 Benefits

Cafeteria 125 plans are no longer just an administrative tool—they’re a strategic advantage. When executed properly through a program like Core360, employers get cost savings and reduced claims, while employees gain access to an extensive suite of benefits, all at $0 copay, including family coverage.

Employers can maximize their tax efficiency by utilizing cafeteria h125 deduction, which also allows them to provide significant, flexible, and compliant benefits. The collaboration with PCMP and SIMRP makes it a richer, simpler, and more impactful experience for all.

Frequently Asked Questions

What are the benefits of the 125 cafeteria plan?

Gives workers different benefit choices, family protection, remote doctor consultation, psychological assistance, and death coverage as well, while on the other hand making employers save on health care expenses.

Gives workers different benefit choices, family protection, remote doctor consultation, psychological assistance, and death coverage as well, while on the other hand making employers save on health care expenses.

Gives workers different benefit choices, family protection, remote doctor consultation, psychological assistance, and death coverage as well, while on the other hand making employers save on health care expenses.

Gives workers different benefit choices, family protection, remote doctor consultation, psychological assistance, and death coverage as well, while on the other hand making employers save on health care expenses.