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Administrator Guide
Last Updated: 2023-06-23
Create Health Care Rates

Create Health Care Rates

  • Security:
    Set Up: Benefits
     in the Benefits functional area.
  • Define benefit annual rate types and assign to workers.
    To define a worker's annualized rate, select
    Benefits
    Change Benefits Annual Rate
     from a worker's related actions menu.
  • Define benefit credits and surcharges.
Create a rate table with values that are based on:
  • Flat amount
  • Percent of the employee's salary
  • Combination of both
Rates might also vary according to demographic information such as age, salary, or length of service.
  1. Access the
    Create Health Care Rate
     task.
  2. Select the
    Method for Rate Calculation
    .
  3. Select the
    Demographic Factors to Consider
    .
  4. If applicable, select the
    Tobacco
     check box.
    Selecting the
    Tobacco
     check box displays the
    Tobacco Use
     column in the rate table. You can enter rates in this column based on the
    Does Not Use
     and
    Uses
     questions.
  5. On the
    Benefit Rate Source
     tab, consider:
    This tab displays for
    percent of salary
     and
    percent of salary with flat amount
     rate types.
    Option Description
    Salary Source
    If you select
    Salary
     as a demographic factor, specify what Workday should use to determine the correct rate band to retrieve the employee and employer rates. Select from:
    • Benefits Annualized Rate or Compensation Elements:
       If available, Workday uses the benefits annualized rate; if not, Workday uses compensation elements. If you select this option, the
      Compensation Element
       field becomes available.
    • Benefits Annualized Rate or Total Base Pay:
       If available, Workday uses the benefits annualized rate; if not, the Workday uses the base salary.
    Benefit Annual Rate Type
    Available if you selected
    Benefits Annualized Rate or Compensation Elements
     or
    Compensation Elements
    .
    Compensation Element
    Available if you selected
    Benefits Annualized Rate or Compensation Elements
    .
    Salary Frequency
    Available if you selected
    Salary
     as a demographic factor. Indicates whether the salaries in the rate band are weekly or monthly salaries, or use a different frequency.
    Calculate As Of
    If you select age, length of service, or salary as demographic factors, tell Workday what date to use in its calculations. Options are:
    • Coverage Begin or Plan Year Begin
      : If the employee had coverage as of the start of the plan year, Workday uses this date. Otherwise, Workday uses the date the employee originally enrolled in the plan.
    • Coverage Begin or Specific Date:
      Workday compares these dates:
      • The date the employee originally enrolled in the benefit plan.
      • The date entered in the Specific Month and Specific Day field.
      It uses the most recent date to retrieve the value and assumes that the year is the current benefit plan year. If you want to use the prior plan year values, select the Prior Year check box.
  6. On the
    Rate Band Definition
     tab, consider:
    Option Description
    Health Care Coverage Targets
    Select the health care targets that you want to assign to this health care rate.
    Minimum Costs/Maximum Costs
    Select these check boxes to include a minimum and maximum costs in the rate band table.
    First Band is 0 to
    Last Band is Over
    Bands Are Incremented By
    Define the parameters Workday uses to build the rows in the rate band table.
    Enter a value greater than zero on
    Bands Are Incremented By
    .
  7. On the
    Final Rounding Rule
     tab, define how you want Workday to adjust the final calculated cost of health care coverage.
    This tab displays for
    percent of salary
     and
    percent of salary with flat amount
     rate types.
    Option Description
    Round Amount To
    Enter the value to which Workday rounds.
    Example: If you want Workday to round to the nearest whole number, enter 1.
    Rounding Rule
    You can:
    • Round Up:
       Example: The amount in this field is 1 USD, and the employee's calculated cost is 1.50 USD. Workday rounds the cost up to 2 USD.
    • Round Down:
       Example: The field amount is 1 USD, and the employee's calculated cost is 1.50 USD. Workday rounds the cost down to 1 USD.
    • Round Up On Number:
       Specify the number at which Workday rounds up or down. Example: The amount in the
      Round Amount To
       field is 1 USD, and the
      Round Up On Number
       is 0.5. Workday rounds up any costs greater than or equal to 0.5 and rounds down any costs less than 0.5. If the calculated cost is 1.49 USD, Workday rounds down to 1 USD. If the cost is 1.5 USD, Workday rounds up to 2 USD.
  8. (Optional) On the
    Rate Bands
     tab, enter the
    Enrollment Code
     on the far right side of the table.
    Entering an enrollment code maps it to that rate band row in Workday. Example: You can map the vendor code 12345 to a Workday rate band. The enrollment code signifies that unique combination of health care benefit plan, premium, and coverage targets for the rate band. You can also change the
    Enrollment Code
     column label by accessing the
    Maintain Custom Labels
     task.
If you selected
Benefits Annualized Rate
 as the
Salary Source
, pay close attention to effective dates when loading the benefits annual rate. Example: You load a conversion event effective 1/1/2009, but then load the employee's compensation or Benefit Annual Rate (BAR) as of 4/1/2009. In this scenario, Workday isn’t able to calculate the coverage.
The rate used to calculate an employee's benefit costs can vary based on the salary definition. Example:
  • When salary = Base Salary, Workday returns a value of 50,000.
  • When salary = Compensation Elements (Base Pay + Commission), Workday returns a value of 65,000 for the same employee.
In the rate table, you can associate each of these values with a different rate: 0.13 for 50,000 of salary, and 0.16 for any salary amount over 60,000.