Health and Welfare Plan
Health and Welfare (HW) plans are employer-sponsored plans that offer a group of employees benefits to ensure their health and well-being. It also protects employees against catastrophic events. HW plans primarily provide employees access to important services during their working years and potentially in retirement.
Here are some benefits of an HW plan:
Preventive care It encourages employees to have regular doctor visits to detect potential health-related problems before they progress to a serious stage.
Tax advantages Employees are able to pay for benefits on a before-tax basis.
Financial security through cost control Benefits are more affordable when employer-provided. Because a larger group of employees is covered, each employee in the group receives a group-rate which is lower than if they receive coverage on their own.
Listed below are some key characteristics of an HW plan:
Employees choose the type of coverage (from an employer-defined list) as well as which individuals to cover (e.g., spouse or spouse and children).
Employers and/or employees pay for all or part of these benefits. Coverage cost varies, depending on the type and extent of the coverage.
Employee costs are usually deducted from employee paychecks.
There are several common types of HW plans:
Flexible Spending Accounts
Health Care benefits provide coverage for health-related services (e.g., doctors, hospitals, and other service providers). Below are examples of health care benefits:
Mental health/substance abuse
Accidental Death and Dismemberment (AD&D)
Business Travel Accident (BTA)