In 1978, something important happened in employee benefits. The US government introduced Section 125 of the tax code. This gave employees a simple way to save money by using part of their income to pay for benefits before taxes were taken out. This is what we call a Section 125 cafeteria plan.
Now, more than 40 years later, this change is still helping workers across the country. But today, companies and employees need more than just the basic plan. That is where the Lumara Plan makes a real difference. It includes Section 125 but does more in the areas of support, care, and savings. In this blog, we will discuss what Section 125 is, how the Lumara Plan operates, and why it is a good choice for companies and employees.
What is a Section 125 Cafeteria Plan?
The definition of Section 125 cafeteria plan is simple. It is a plan that lets employees choose from different types of benefits and pay for them using money that is not taxed. This means they pay less tax and keep more of their income.
It is called a cafeteria plan because employees can pick and choose the benefits they want, just like food in a cafeteria.
But the Lumara Plan is not just a Section 125 cafeteria plan. It takes the idea and improves it by adding two major parts.
How Section 125 Changed the Game Over 40 Years?
Back in 1978, when Section 125 was created, it changed how companies offered benefits. Employees could now save money on taxes while still getting the benefits they needed. For 40 years, this rule helped many American workers stretch their paychecks and enjoy better benefits.
But today, just offering a basic Section 125 plan isn’t enough. Employees want more support. Employers want real savings. That’s where the Lumara Plan comes in.
How is the Lumara Plan Different?
The Lumara Plan is not just a regular Section 125 cafeteria plan. It includes Section 125 but also brings together two powerful programs. These are the Preventive Care Management Plan called PCMP and the Specialized Insurance Medical Reimbursement Plan called SIMRP. Together, they create one of the most complete and trusted benefit plans available today. The Lumara Plan is simple for employers to roll out and even easier for employees to use. It helps companies save money while giving employees better health support and more money in their paycheck. This plan truly benefits both employers and employees in a big way.
Benefits for Employers
The Lumara Plan is built to help businesses save money while taking care of their employees. It is simple to start and gives fast results. Here’s how it helps employers in a real and clear way.
Following are the benefits it offers to employers:
- Employers can save about $600 every year for each W2 employee.
- The company does not have to pay anything out of pocket to start the plan.
- It helps reduce healthcare claims by around $1,400 per employee over three years.
- The plan can be set up quickly, usually in 30 to 45 days, with little effort needed.
- It helps employers retain good employees and improve performance.
- The company can see clear financial improvements right away.
- It also helps reduce total healthcare costs by 5 to 10 percent, which adds up to even more savings.
Benefits for Employees
The Lumara Plan is made to truly support employees in their health and daily lives. It gives real benefits that are easy to understand and even easier to use. Here is what employees get with the Lumara Plan:
The following are the benefits it offers to employees:
- Employees see an increase in their take-home pay by around $100 each month, with no extra cost to the employer.
- They get 24/7 access to Telemedicine and Virtual Care, and they don’t have to pay a copay.
- Spouses and dependents are also fully covered, and their care also comes with zero copays.
- Employees get free access to the Employee Assistance Program (EAP), which offers mental health and counseling support.
- The plan includes couples counseling and addiction recovery support, all at no cost.
- Employees can use trusted Mayo Clinic programs and manage their health with a personal health dashboard.
- They can check their health easily with a built-in Health Vitals Facial Scan Tool.
- There are simple and helpful diet and stress programs to support their wellness.
- Everyone in the family gets 12 wellness visits every year, and there are no copays at all for any of these services.
Why Does This Matter Now?
Many companies still only offer a basic Section 125 cafeteria plan. But employees today need more support for health care and wellness. They also want more from their paycheck.
The Lumara Plan meets these needs. It gives better care, more savings and higher take home pay. Plus it is easy to use and does not create extra work for HR teams. This is the future of employee benefits.
Conclusion: 40 Years of Employee Benefits
The Section 125 cafeteria plan changed the benefits world 40 years ago by helping workers save money and choose their benefits. The Lumara Plan takes that one step further.
It brings together Section 125 with modern wellness support and insurance coverage through PCMP and SIMRP. The result is one of the best benefit plans available today.
Whether you are an employer looking to save money or an employee who wants more value, the Lumara Plan delivers.
Read More:-
