What Is an IRS Section 125-Based SPC Plan? 5 Reasons It’s a Game-Changer for Employers

Employee benefits are more than just perks—they’re a competitive advantage. In an evolving workplace, employers are seeking smarter ways to support their teams and their bottom line. Enter Supplemental Preventative Care (SPC) Plans, built on the trusted framework of IRS Section 125.

If you’re not familiar with how these plans work or why they’re such a buzzword, don’t worry. Let’s break it down.

1. IRS Section 125: The Foundation of Tax Savings

IRS Section 125, often called a “Cafeteria Plan,” allows employees to allocate pre-tax dollars toward specific benefits. This lowers taxable income for employees while reducing payroll taxes for employers. It’s the rare win-win scenario in employee benefits.

SPC Plans take this concept further by pairing IRS Section 125 tax advantages with a suite of preventative healthcare services. Think of it as tax savings with benefits that actually benefit.

2. Immediate Financial Impact for Employers

Every employer’s favorite word? “Savings.” SPC Plans deliver an average of $561 in annual payroll tax savings per qualified employee. For mid-sized companies, that’s tens—or even hundreds—of thousands of dollars in savings. And here’s the kicker: these savings are visible as early as the next payroll cycle.

Employers only pay a nominal, fixed monthly fee—but only after these savings have already been achieved. Translation: zero risk, guaranteed reward.

3. Proactive, Preventative Care Is the Future

The healthcare landscape is shifting. Employers can no longer afford to react to rising healthcare costs—they need to prevent them. SPC Plans include:

• Free biometric screenings to identify health risks early.

• 24/7 telehealth access for immediate care.

• Mental health resources like therapy sessions and stress management tools.

• Cost-saving financial tools, including pre-tax options and common medication coverage.

The result? A healthier workforce, fewer major medical claims, and long-term cost savings.

4. Employees Win, Too

SPC Plans aren’t just about what employers save. They’re about what employees gain:

• Increased take-home pay through pre-tax contributions.

• Improved access to care, from physical health to mental health.

• Reduced financial stress, thanks to lower out-of-pocket costs and built-in savings tools.

Happier, healthier employees stay longer, work harder, and help build a stronger company culture. It’s a virtuous cycle of success.

5. Compliance? Handled.

IRS, ACA, and HIPAA regulations are enough to make anyone’s head spin. Luckily, SPC Plans are designed with compliance baked in. From automated eligibility checks to seamless payroll integration, these plans take the burden off HR teams and keep everything running smoothly.

Why This Matters in 2024

The start of a new year is the perfect time to evaluate your employee benefits strategy. Companies that embrace forward-thinking solutions like SPC Plans set themselves apart in a competitive job market. You’re not just keeping up—you’re leading.

Want to learn more about how SPC Plans can revolutionize your benefits program? Let’s talk.

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About SilverPoint Strategies

SilverPoint Strategies specializes in SUPPLEMENTAL PREVENTATIVE CARE (SPC) Plans. These plans are built on IRS Section 125 and paired with a best-fit provider to unlock significant payroll tax savings. Employers save an average of $561 per qualified employee annually, with savings realized as early as your next payroll cycle. Additionally, SPC Plans reduce claims on your existing primary medical plan, which can lower renewal costs and deliver even greater long-term savings.

As an independent consultant, SilverPoint Strategies serves as your single point of contact, working solely in your best interest to align you with the most impactful and value-driven solutions. By continuously monitoring the market, we ensure access to the latest innovations and provide seamless guidance through every step of the process. With a commitment to white-glove service and meticulous attention to detail, we help maximize ROI, enhance employee benefits, and foster healthier, more engaged workplaces. Contact us today for a free no-obligation consultation.