Employer Deduction Drafting (EDD)

PIOPAC’s Employer Deduction Drafting (EDD) service provides a streamlined approach that allows organizations to utilize their payroll systems to perform payroll deductions in order to retain complete control and oversight of participation and eligibility, as well as enjoy any tax advantages from pre-taxing qualified plans by taking premiums out of earnings. The employer is primarily responsible for managing eligibility and deductions, but they have no responsibility for remitting premiums to the various carriers. This helps avoid the ongoing commitment to expensive and often complicated benefits billing administration.

Our approach supports employers so they can offer benefits while enjoying the advantages of a robust benefits package without the complications and expenses of fully managing true payroll deductions and the extensive billing and remittance processes required by carriers. EDD reduces the billing burdens and associated administrative costs and improves your overhead by streamlining and avoiding the invoice remittance process altogether.

Once PIOPAC receives the data for the employees’ policies, the preferred payment account information (generally the organization’s payroll checking account), and the payroll frequency and cadence, PIOPAC will draft the aggregated total of the premiums (plus PIOPAC’s fee for service) from the employer’s payment account. PIOPAC then assigns the premiums to each policy for each participant across each carrier and remits those premiums to each carrier with the appropriate remittance files.

Organizations must continue to manage eligibility, meaning they must advise carriers and PIOPAC of terminations. Generally, an enrollment platform or broker/agent will advise of new enrollments. PIOPAC adjusts the draft amount accordingly, and drafts recur as scheduled pending the next change submitted to PIOPAC.

Advantages of EDD

Offer your employees or members sponsored benefits without the need to actively remit premiums to carriers.

• Never receive an invoice, never hold funds, and never remit premiums.
• EDD enables you to offer enhanced benefits without the traditional “billing burdens” associated with them.
• No Set-Up Fees for Employers, Unions, and Associations
• No Subsidy Requirement

Only 5 Active Participants Required to Enjoy PIOPAC’s Billing Services: The Choice Is Yours

As plan sponsor, you choose the benefits (which may include health programs, life, disability, supplemental offerings, and/or Minimum Essential Coverage (MEC) plan(s), to name a few) that best meet your employees’ or members’ needs. You also choose the enrollment method that best aligns with your engagement strategy (e.g., onsite enrollers, call center, and/or online platform).

You provide marketing support and enrollment conditions where employees/members can become educated on the new benefit offerings and provide the environment for them to enroll in the protection they need. PIOPAC can also work with you on drafting any employer subsidies for specific plans as needed.

Once drafted, we gather both the employee premiums and employer premiums and remit the premiums to carriers, with premiums broken down by product accordingly, on behalf of the client for each employee or member.

Why Choose PIOPAC?

• We cut out the billing hassles that you don’t have time for.
• Our flexible approach includes all your preferred benefit carriers.
• We can also collect union and association dues and, when requested, additional monies for non-insured products such as United Way contributions, etc.

If an employer prefers to enjoy cafeteria plan tax advantages and does not mind managing deductions but would like to avoid the billing and remittance workloads and expenses, our Employer Deduction Draft (EDD) solution might be the appropriate solution.

*Upon consultation, PIOPAC will determine what (if anything) is needed to support your organization with our billing and remittance services. A billing call may be needed with the carrier/TPA if we are not already working with them.

**PIOPAC may request a billing call with the organization to ensure processes are compatible and these parties can be paid directly by PIOPAC. All changes must be submitted to PIOPAC prior to payroll close for the change in question.