Mar 04, 2025
Amwins Connect – March 2025 Question of the Month
Question
An employer offers medical, dental and vision benefits to their full-time employees. The premiums for the three (3) different coverages are bundled meaning that if the employee enrolls in medical, they are enrolled in dental and vision as well and will pay a bundled premium. The employees cannot select to enroll in only one of the three benefits offered. How would the affordability rules apply to this scenario?
Answer
We will explain using an example.
Sample premium breakdown for single coverage would be:
- Medical - $300/month
- Dental - $10/month
- Vision - $5/month
Total premium $315
Current affordability percentage for plan years beginning in 2025 is 9.02%.
When the employer is testing affordability, they must use the $315 premium because the employee cannot choose to enroll in medical only. If the employer were to separate (unbundle) the three premiums, the affordability rules would then apply to the $300 monthly premium for the medical coverage only.
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