Immix Group FAQ
Group Benefits: Answers to your most frequently asked questions
Benefits plans are available for most companies, whether they have many employees or just two. And even if you are a sole proprietor working on your own, there may be options available to you.
1) Your company must be incorporated.
2) Your company needs to have been in business for six months or more.
3) The family content of your company (related individuals) must be less than 50%.
Generally speaking, the two programs are complementary in that services covered through the government, are not covered through benefit programs (and vice versa!). However, there can be some exceptions to this rule.
Provincial health coverage provides basic access to medically necessary services. These are services such as doctor visits, emergency dental/oral surgery performed in the hospital, and some diagnostic servicesX-rays. Extended health and dental care coverage through group plans offers coverage above and beyond the basic services covered under provincial health care. This extended coverage may include prescription drugs, medical equipment, various health practitioners and dental procedures.
If a member has coverage through their partner’s plan, they usually still must enrol in their own employer’s plan. However, they do have the option to waive health and dental coverage. Alternatively, they can enrol for coverage under both plans and coordinate the coverage. In that case, they are eligible to be reimbursed by both plans for eligible expenses up to 100% of the cost.
Most group benefit plans cover a member’s dependents, including their spouse or common-law partner, and their children (natural, step, adopted or foster). If both parents have plans in place, they have two options: waive coverage under one of the plans; or enrol in both plans and coordinate benefits.
Typically, a dependent is your spouse or common-law partner (opposite or same-sex) and child(ren). A dependent child is a child of you or your spouse. To be eligible under most plans, a child must not be married or common-law, and be under age 21 (or 25 if a full-time student and financially dependent on you). Children of any age are typically eligible if they're incapable of self-supporting due to a physical or mental disability. Parents of employees and their spouses are generally not eligible, regardless of caregiving or financial situations.
Most insurance carriers provide individual plans that provide benefits similar to those in a group plan. Individuals may be required to complete a medical questionnaire before being approved for coverage.
For more information on individual plans, please contact our office.
The BC government’s Fair PharmaCare plan subsidizes eligible drugs and other medical supplies prescribed by a physician. Under Fair PharmaCare, individuals are responsible for paying for their prescription drugs until they satisfy the annual deductible. The deductibles and maximums are based on net income from two years prior. Once the deductible amount has been reached, Fair PharmaCare will cover 70% of eligible costs for the rest of the year. If a member reaches a specified maximum, Fair PharmaCare will cover 100% of eligible expenses for the remainder of the year.
Insurance companies will ask an employee to provide their Fair PharmaCare number after they have reached a certain threshold in claims (the threshold differs by insurer). Insurance companies want to ensure the claims they are paying are being coordinated properly with the coverage provided through MSP in BC, under Fair PharmaCare provisions.
Yes, absolutely! Employees who are leaving a group plan for any reason (retiring, moving on to a new job, taking a leave of absence or being terminated) have 60 days to enrol for coverage under an individual plan, without the requirement to provide medical evidence of good health. This is a very important provision, as it allows for those with pre-existing medical conditions to remain insured.
If you are losing your group coverage, please ask us for details about setting up an individual plan.
Most benefits plans include emergency out-of-province coverage under the extended health care benefit. Emergency expenses are defined as unexpected and unforeseen medical emergencies. This benefit usually provides 100% coverage for emergency expenses incurred while travelling. The coverage applies to personal travel and is not limited to work-related travel outside the province. Aside from medical and hospital expenses, the plan may include coverage for: translation services, transportation home or to a different medical facility, return of lost luggage and passports, repatriation, return of vehicle, hotel accommodation for family, etc.
Generally speaking, emergency travel coverage through a group plan will insure individuals and their dependents for up to 60 days of consecutive travel. The maximum coverage amount per person varies from carrier to carrier.
Cost Plus is commonly used for “one-off” expenses and does not entail a set-up process. It is generally allowed with all group insurance extended health care contracts.
Health Spending Accounts (HSAs) provide a pre-determined annual allocation amount per employee. HSAs must be formally set-up with the insurance carrier prior to submitting expenses.
Both plans cover Canada Revenue Agency-eligible expenses. Both may be used for services and supplies not covered under a benefits plan or where a maximum limit has been reached. Essentially, reimbursement through either Cost Plus or a Health Spending Account allows a CRA-eligible medical expense to become a tax-deductible expense for the business, rather than a personal after-tax expense.
The Extended Drug Policy Protection Plan (EP3) is an internal drug pooling arrangement between all Canadian insurers who provide private group drug insurance plans. This industry-wide agreement took effect January 1, 2013 and applies to all fully-insured drug plans in Canada.
The EP3 arrangement was created to address the growing need to spread the risk of very expensive specialty drugs across a wider pool for greater rate stabilization.
Further resources on EP3
When claiming under two plans, you claim to your employer’s benefits plan first. Then, for any remaining reimbursement, claim through your partner’s plan.
For your children, you claim first through the plan of the parent whose birthday is first in the calendar year.
The majority of the time, the answer is yes! Long Term Disability (LTD) coverage provides income replacement benefits in the event an employee is no longer able to work due to illness or injury. LTD typically begins payments after an employee has been off work due to disability for 16 weeks (matching to the end of government EI Sickness benefits or insured Short Term Disability.
The availability and composition of LTD under a group plan depends on the employee industry, group size and demographic composition, average incomes and certain other relevant factors that affect the risk profile of the group.
This is not currently required by law. However, a group savings plan is a great way to help employees save for retirement. It provides a tax-effective way to compensate employees and is a valued component of a comprehensive employee benefits program.
Many carriers offer ex-patriate insurance, a.k.a. ex-pat insurance, for employees of a Canadian company who are working elsewhere in the world. Ask us for details on how to set this up!
Employees on maternity leave are entitled to the same coverage they are eligible for while at work. They have the option to waive coverage for which they pay all or a portion of the premium. All employer-paid coverage must continue as usual. Typically, employers will collect post-dated cheques from employees to cover their portion of the cost, if they do not have payroll to deduct premiums from during the maternity leave. Upon the employee’s return to work from mat leave, any waived benefits are reinstated immediately.
Yes! It is very common for employers to waive the usual three-month waiting period as an incentive in hiring. The waiting period cannot be amended to a different duration, but it can typically be waived entirely. The insurance carrier requires a reason for the waiver in most instances.
If the coverage under the benefits program is leaving expenses for your employee uninsured, you can utilize cost plus reimbursement to have the company pay in a tax-efficient way. Specifically, most insurers allow for CRA-eligible medical expenses to be paid for by employers (as a tax-deductible expense), and for tax-free reimbursement directly to the employee. The insurer acts as the adjudicator of the expense, charging a small administration charge for handling the transaction.
Late applicants are employees who seek to enrol for insurance coverage after their date of eligibility (plus any grace period) has passed. Insurance carriers follow common guidelines in dealing with them.
When an employee or dependents become eligible for coverage, e.g., three months after being hired, they must be enrolled in the benefits program beginning on their date of eligibility. There is usually a short grace period, usually 31 days. But enrolling late, e.g., eight months after being hired under a program with a three-month waiting period, would result in the person being deemed a late applicant.
A late applicant status could also result from other scenarios, such as a person having a new spouse or new child but failing to enrol them in the program at the point the spouse/child becomes eligible.
Most insurance carriers apply similar rules regarding coverage for late applicants. First, the dental reimbursement is restricted to $250 in the first year. Second, the applicant must complete a medical questionnaire and be approved in order to receive extended health care coverage.
The reason for these strict rules is to ensure that members are enrolled systematically, regardless of their health. This keeps the group of people “random.” It also guards against anti-selection, a phenomenon where those who are the least healthy are the most likely to enrol for coverage.
Ensuring all employees and dependents are held to strict timeframes when it comes to enrolling in benefit plans ensures that both unhealthy and healthy people are enrolling at an equal rate.
Yes. Generally speaking, insurance carriers work with brokers, rather than directly with business owners or HR people.
When an employer provides short-term disability benefits through an approved program, they are eligible to apply for reduced EI premiums through the Premium Reduction Program. This recognizes the fact that the employer-sponsored program means employees would potentially not be accessing EI Sickness benefits through Service Canada. You’ll find more information on EI Premium Reduction Programs on the Service Canada Website.
The Supplemental Unemployment Benefit Program, or SUB plan, allows employers to provide supplemental payments to EI benefits during periods of unemployment. Certain conditions must be met.
The purpose of a registered SUB plan is to allow for employers to increase the employee’s weekly earnings during periods of unemployment without impacting EI benefits. Check out the Service Canada website for more information.
Many insurance plans – specifically, Long Term Disability and travel coverage – include pre-existing conditions clauses, meaning medical issues that existed prior to your insurance becoming effective may not be covered. Specific timelines apply and certain wording is very important in describing the situation. It is important that you understand exactly how this clause works within your own contract of insurance. Not all contracts are the same!
This is why contract language – especially for long term disability programs – is so important! The answer is: Maybe. The partners may not be insured if they are not earning traditional T4 income. However, this depends on how your contract was established and what was disclosed and approved at the time it was issued. A long-term disability contract specifies the types of earnings it insures. This can be: salary only; salary plus commissions; or other combinations or types of income. It’s essential to ensure that you have properly addressed this matter so that all employees, partners or other key people are properly covered!