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Administrator Guide
Last Updated: 2023-06-23
Create Insurance Plans

Create Insurance Plans

  • Set up benefits.
  • Set up insurance costs.
  • Configure insurance coverage definitions.
  • Security:
    Set Up: Benefits
     in the Benefits functional area.
Define the insurance plans for your employees.
  1. Access the
    Create Benefit Plan
     task.
  2. In the
    Benefit Plan Type
     field, select
    Insurance Coverage Plan
    .
  3. As you complete the task, consider:
    Option Description
    Do Not Use
    When selected, Workday appends the
    Do Not Use
     label to the benefit plan name and hides it from
    Benefit Plan
     configuration prompts, as of the effective date. This check box doesn't hide the benefit plan name from configuration prompts in these tasks and business process:
    • Create
       or
      Edit External Payroll Deduction
       tasks.
    • Create
       or
      Edit External Payroll Earning
       tasks.
    • Review COBRA Eligibility Event
       business process.
    External Plan Description
    Provide a link to an external document about the benefit plan; Workday displays this link on the enrollment form.
    Worker Plan Eligibility
    If not all workers in the participating benefit groups are eligible for this plan, then select an eligibility rule to limit coverage to a subset.
    Example: You want to limit coverage within the
    Hourly Employees
     benefit group to workers in the state of California. To do so, select an eligibility rule that includes only California workers.
    Dependent Plan Eligibility
    Select an eligibility rule to limit coverage to a class or category of dependents.
    Example: Limit coverage to dependents under the age of 27.
    Only dependents who meet the criteria for an eligibility rule become available for selection during enrollment. If you don't select a dependent plan eligibility rule, coverage is available to all dependents.
    Employee Cost is Pre-Tax
    If you clear this check box, Workday takes employee costs from after-tax earnings.
    Employer Cost is Non-Taxable
    If you clear this check box, Workday considers employer costs taxable to the employee.
    Auto Enroll
    Select to enroll employees in an insurance plan automatically.
    Then select the
    Only One Election
     option for the coverage type to which the insurance plan belongs.
    Don't select
    Auto Enroll
     for insurance plans that require evidence of insurability (EOI).
    On the enrollment pages, Workday automatically selects
    Elect
     for this election, which employees can't change.
    Enable Evidence of Insurability Link
    Select to display the
    Evidence of Insurability Link
     prompt and to display the link during an enrollment event.
    Evidence of Insurability Link
    Select or create an external URL that links workers to evidence of insurability information. Example: Link to the provider website or information on your organization website.
    Covers
    Identify the target populations that are valid for the insurance plan.
    Insurance Coverage
    Select an insurance coverage definition to specify the coverage levels or amounts that employees enrolling in the plan can select.
    Use Individual Rates
    Select this check box to override the employee and employer costs defined with the
    Manage Individual Rates
     task.
    Reset Individual Rates on Plan Year Begin
    Select to update employee and employer costs when the new plan year begins. Workday uses the values defined in the benefit plan. If you don't select this check box, the costs stay the same as the preceding year.
    Earnings and Deductions
    For Workday Payroll, select:
    • Earnings
       for benefit credits. Calculates employer costs that are taxable to the employee (required for imputed income).
    • Deductions
       for pretax and post-tax employee costs. Calculates employer costs and benefit surcharges that aren’t taxable to the employee. Workday also uses these deductions for calculated health care rates.
      If you don't specify deductions, the plans might not display costs.
    When using the Payroll Interface for Workday, perform additional setup steps to map earnings and deductions to flexible health care rates. Contact your Integration Consultant for more guidance on these setup steps.
  4. In the
    Expanded Plan Details
     section, add plan details for your employees so that they can see the specific features of the benefit plan. You can also add instructions and links to benefit plan information. Workday displays coverage options with costs.
  5. In the
    Benefits Eligibility and Rates
     tab, define the plan costs and benefit credits for each benefit group that qualifies for the insurance plan.
  6. (Optional) In the
    External Payroll Deductions
     tab, select the payroll deduction code.
    If you’re using an external payroll system to calculate insurance costs, select benefit deduction for the payroll entity.
  7. (Optional) In the
    Age Adjustment Policy
     tab:
    1. Select whether to calculate the employee cost based on the age-adjusted or full coverage amount. Make the same selection for the employer contribution.
    2. Select
      Use Employee's Age for Age Adjustment
       to base the spouse age-adjusted coverage amount on the employee age.
    3. Define rules for adjusting insurance coverage amounts based on an employee age:
      • Enter the
        Age From
        , the
        Age To
        , and the
        Multiply by Percentage
         fields.
      • Select the
        Calculate As Of
         date and, if necessary, enter the specific month (expressed as a number) and day. You can select
        Of Prior Plan Year
         check box to use specific dates from the prior plan year.
      • Select
        Last Date of Previous Pay Period
         to enable the new coverage amount based on an employee's age to become effective the pay period following the one in which their birthday occurs.
    Example: Adjust coverage amount to 95% of full coverage for employees 70 to 75 years of age.
  • Create or edit the benefit plan year definition and add this plan.
  • (Optional) Create cross-plan insurance prerequisites.
  • (Optional) Create cross-plan coverage amount or percentage maximums.