Managing payroll while offering solid employee benefits is a balancing act. Employers want to attract and keep top talent, cut payroll taxes, and control healthcare costs. But hitting all three targets at once is tricky. That’s where a smart IRC 125 strategy comes in. With a well-designed plan 125, businesses can save on taxes, improve employee benefits, and modernize their payroll approach without adding costs or headaches.
Healthsphere has two plans, Revive and Thrive, that make this possible.
What is an IRC 125 Plan?
An IRC 125, also called a cafeteria plan, lets employees pick from a menu of pre-tax benefits offered by their employer. It reduces taxable income for employees and saves employers money on payroll taxes.
The real advantage of a plan 125 is flexibility. Employees can choose what matters most to them, whether it’s telemedicine, mental health support, prescription coverage, or family-focused care. Healthsphere takes this setup and turns it into two plans that bring real value: Revive and Thrive.
Payroll Savings and Cost Efficiency
A big reason to implement an IRC 125 plan is the cost savings. Healthsphere focuses on reducing employer costs while keeping employee benefits strong.
- Revive can save roughly $1,100 per W2 employee per year and reduce healthcare costs by 5-10%.
- Thrive saves about $600 per W2 employee per year, with the same 5-10% reduction in healthcare costs.
These savings come from smart use of pre-tax contributions and employee benefits while staying fully compliant with IRS rules. From section 125 benefit plan, businesses can reclaim money they would have lost to payroll taxes and put it toward meaningful employee perks or other priorities.
Giving Employees More Without Adding Cost
A good IRC 125 plan doesn’t just save money for the company. It gives employees benefits they actually use, often at $0 out-of-pocket cost. Healthsphere’s Revive and Thrive plans make this the focus, covering employees and their families.
What Employees Get With Revive
- 24/7 Telemedicine & Virtual Care
- Family Coverage with 12 Annual Care Visits
- Employee Assistance Program (EAP)
- Mental Health & Counseling
- Mayo Clinic Programs
- Minimal Essential Coverage (MEC)
- Group Term Life Insurance ($60-100/month)
- Discounts on Vision, Dental & Prescriptions
- RX Coverage (No Copays)
- In-person Urgent Care
- $0 Copays on Everything
Group Term Life Insurance is important because it gives employees peace of mind that their loved ones are protected. Family coverage matters too. Spouses and dependents are included, which makes the plan more valuable for households.
What Employees Get With Thrive
- Increase Net Pay by $100/month
- 24/7 Telemedicine & Virtual Care
- Spousal & Dependent Coverage
- Employee Assistance Program (EAP)
- Mental Health & Counseling
- Mayo Clinic Programs
- Addiction Recovery Support
- Couples Counseling & EAP
- Health Vitals Facial Scan Tool
- Diet & Stress Programs
- $0 Copays on All Services
Thrive focuses on well-being and mental health while keeping costs down. All benefits apply to both employees and their families, which makes it a solid, practical plan.
Why Family Coverage and Zero Copays Are a Big Deal
Two things make a plan 125 really work: family coverage and $0 copays.
- Family Coverage
Many plans cover only the employee, leaving their spouse and kids exposed. Revive and Thrive include everyone. That matters to employees and shows employers are serious about caring for their team.
- $0 Copays
Hidden fees or copays stop people from using benefits. With $0 copays, employees get the care they need without worrying about the cost. This encourages preventive care, keeps people healthier, and reduces time off work.
Getting a Plan 125 Up and Running
Setting up a plan 125 might seem complicated, but Healthsphere makes it simple. Their plans integrate with existing payroll systems, so deductions happen automatically. Employers can choose Revive or Thrive and know that compliance, communication, and support are all handled.
Steps to Make it Happen
- Check Current Setup
Look at payroll, healthcare costs, and employee needs to figure out which plan fits best.
- Payroll Integration
Healthsphere works with multiple payroll systems for smooth pre-tax deductions.
- Employee Enrollment
Employees pick benefits from the IRC 125 menu, with guidance on coverage for themselves and their families.
- Ongoing Support
Healthsphere keeps the plan compliant and adjusts as employee needs change.
The Dual Advantage
A good IRC 125 plan creates wins for both sides:
- Employers save money and reduce healthcare costs without extra work.
- Employees get meaningful health benefits, family coverage, and support programs at zero cost.
Healthsphere’s two-plan approach lets businesses choose what fits best. Revive is great for maximum savings and life insurance coverage. Thrive is better for boosting net pay and holistic well-being.
Conclusion
Using a smart IRC 125 plan is more than a tax trick. It’s a strategy that helps businesses save money, provide better benefits, and keep employees happy. Healthsphere’s Revive and Thrive plans make this real. They focus on family coverage, zero copays, and benefits employees actually want to use.
A modern payroll strategy isn’t just paying employees. It’s about building a benefits system that supports your team and your bottom line. Healthsphere makes it simple, practical, and valuable for both employers and employees.
Ready to upgrade your payroll strategy with real savings and better benefits?
Schedule a Free Section 125 Plan Consultation
FAQ
How does a Section 125 plan work?
It lets employees use pre-tax dollars for benefits, lowering their taxable income and reducing employer payroll tax costs.
What are the 5 basic steps in processing payroll?
Collect employee data, calculate gross pay, apply deductions, run payroll, then file taxes and keep accurate records.
What is the payroll implementation process?
It’s the setup phase where payroll data, deductions, and integrations are configured and tested before going live.
What is medical 125 on a paystub?
It shows a medical deduction taken pre-tax under a Section 125 plan, reducing the employee’s taxable income.
