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Compensation management

Hello xperts,

i'm looking for a detailed idea about compensation management and benefits componets and theor configuration...helpful replies will be rewarded

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    author's profile photo Former Member
    Former Member
    Posted on Mar 31, 2008 at 06:33 AM

    HAI..

    for benefits...

    For Benefit Config

    In order to administer and maintain your plans separately, you will work in your own benefit area.

    1a. Define the benefit areas

    Menu Path:

    IMG>Personnel Management>Benefits>Basic Settings>Define benefit areas.

    (Note: This is not used for eligibility but administration. It allows you to have separate administration or separate benefit plan pools. A benefit area can be administered in one currency at a time only).

    Steps:

    • Hit the “New entries” button

    • Enter your own Benefit area and Country grouping

    • Hit the “Save” button

    1b. Maintain BAREA feature

    Menu Path:

    IMG>Personnel Management>Benefits>Basic Settings>Define Benefit Areas

    Steps:

    • Click on “Feature” button and Maintain

    1c. Set currency for the benefit areas

    Menu Path:

    IMG>Personnel Management>Benefits>Basic Settings>Assign currency to Benefit areas

    Steps:

    • Hit the “New entries” button

    - Enter your Benefit area and Currency

    1d. Set the current benefit area (IMG and user parameters)

    Menu Path:

    IMG>Personnel Management>Benefits>Basic Settings>Set current benefit area

    Steps:

    • Select your Benefit area and hit enter

    For User Parameter:

    - System > User profile > Own data > Parameters tab

    - Set parameter as BEN = XX

    2. National is the provider for all benefit plans. Within National, there is a provider for each health/spending, savings, and insurance plans.

    2a. Define the benefit provider

    Menu Path:

    IMG>Personnel Management>Benefits>Basic Settings>Define benefit providers

    Steps:

    • Hit the “New entries” button

    • Enter your health/spending, savings, and insurance plans providers

    • Hit the “Save” button

    3. QD allows members of the immediate family to be considered as dependents and beneficiaries.

    3a. Define dependents and beneficiaries

    Menu Path:

    IMG>Personnel Management>Benefits>Basic Settings>Dependents and Beneficiaries>Define dependents and beneficiaries

    Steps:

    Note: Here you will define employee’s relatives and close acquaintances are permitted dependents for health and miscellaneous plans, and beneficiaries for insurance, savings and miscellaneous plans. (i.e. spouse, divorced spouse, step-child, child).

    • Hit the “New entries” button

    • Select the dependent subtype from the drop down window

    • Check dependent box or beneficiary box or both

    • Hit the “Save” button

    4. QD offers 8 types of benefit plans: medical, dental, basic life insurance, supplementary life insurance, 2 separate savings plans, credit, legal coverage, and a healthcare spending account.

    4a. Define the benefit plan types

    Menu Path:

    IMG>Personnel Management>Benefits>Basic Settings>Plan attributes>Define benefit plan types

    Steps:

    Note: The system does not allow for an employee to enroll in more than one benefit plan per plan type (i.e. employee can not enroll in both the Medical Indemnity and Medical HMO, but they do have a choice of one or the other).

    - Enter a plan type identifier and its description

    - Choose the corresponding benefit category code for the plan type.

    5. QD’s plans are all active and able to be enrolled in, but they would like the option for closing and phasing out plans if needed.

    5a. Define benefit plan status

    Menu Path:

    IMG>Personnel Management>Benefits>Basic Settings>Plan attributes>Define benefit plan status

    Steps:

    • Enter an identifier to represent each status

    • Enter a status description

    • Indicate if plan is active and if it is available for enrollment

    Status Text Active Enroll

    CL Closed

    LK Locked

    OP Open  

    6. QD offers a basic insurance plan that has different costs depending on the age and salary of the employee. Develop the salary and age as criteria for the plans.

    6a. Define parameter groups.

    Menu Path:

    IMG>Personnel Management>Benefits>Basic Settings>Define employee groupings>Define employee criteria groups>Define parameter groups

    Steps:

    - Enter parameter group and description

    - Hit the “Save” button

    6b. Define age, salary and seniority groups (read step 12 for the required groups)

    Menu Path: Salary group

    IMG>Personnel Management>Benefits>Basic Settings>Define employee groupings>Define employee criteria groups>Define salary groups

    Steps:

    - Select “Salary criteria” in the “Select Transaction screen”

    • Enter the Salary group ID and its description

    - Enter the Low and High values for the salary group

    Menu Path: Age group

    IMG>Personnel Management>Benefits>Basic Settings>Define employee groupings>Define employee criteria groups>Define age groups

    Steps:

    • Select “Age criteria” in the “Select Transaction screen”

    • Enter the Age group ID and its description

    • Enter the Low and High values for the age group

    Menu Path: Seniority group

    IMG>Personnel Management>Benefits>Basic Settings>Define employee groupings>Define employee criteria groups>Define age groups

    Steps:

    • Select “Seniority criteria” in the “Select Transaction screen”

    • Enter the Length of service ID and its description

    • Enter the Lowest and Maximum values

    7. The legal plan covers employees in the executive organizational unit. Create a coverage group for the executive legal plan.

    7a. Define coverage groupings

    Menu Path:

    IMG>Personnel Management>Benefits>Basic Settings>Define employee groupings>Define coverage groupings

    Steps:

    • Hit the “New entries” button

    • Enter coverage group

    • Hit the “Save” button

    8. For the 401k savings plan, full time employees (greater than 37.5 hours/week) may contribute a maximum of 16% of their pre-tax salary. Part time employees may contribute a maximum of 10%. Create groups to separate the part time and full time employees.

    8a. Define Employee Contribution Groups

    Menu Path:

    IMG>Personnel Management>Benefits>Basic Settings>Define employee groupings>Define employee contribution groups

    Steps:

    • Hit the “New entries” button

    • Enter identification and description for employee contribution group

    • Hit the “Save” button

    9. QD contributes to a retirement plan (RBAP) after one year of service for the salary employees only. Create groups to distinguish the salary employees from the hourly employees.

    9a. Define Employer Contribution Groups

    Menu Path:

    IMG>Personnel Management>Benefits>Basic Settings>Define employee groups>Define employer contribution groups

    Steps:

    • Hit the “New entries” button

    • Enter identification and description for employer contribution group

    • Hit the “Save” button

    10. The 2 medical plans offered are an HMO and a traditional indemnity. The company pays 50% of the provider costs for each. The following costs are stated in monthly amounts:

    • The provider cost for a nonsmoking HMO are $60 for employee only, $80 for employee and spouse, and $150 for employee and family. Smoking adds an additional $20 to the provider cost.

    • The traditional indemnity has a high deductible and a low deductible option. The cost for a high deductible is $100 for employee only, $120 for employee and spouse, and $200 for employee and family. Smoking adds an additional $20 and a low deductible an additional $10 to the provider cost.

    Menu Path:

    IMG >Personnel Management>Benefits>Plans>Health Plans

    Steps:

    • Define health plan general data

    • Define options for health plans

    - Define dependent coverage options

    - Define cost variants

    - Define cost rules

    - Assign health plan attributes

    - Define evidence of insurability conditions

    11. A dental plan is offered to all employees and is subject to no specific criteria. The cost, regardless of number of dependents, is $5/month, paid for entirely by the employer.

    Menu Path:

    IMG >Personnel Management>Benefits>Plans>Health Plans

    Steps:

    • Define health plan general data

    • Define options for health plans

    • Define dependent coverage options

    - Define cost variants

    • Define cost rules

    • Assign health plan attributes

    • Define evidence of insurability conditions

    12. The basic life insurance is subject to age and salary criteria. The plan coverages offered are 1x base salary and 2x base salary, up to a maximum coverage of $500,000. Costs are paid for by the employee and are, per $1000 coverage:

    • for salary levels below $120,000: $0.05 below age 50, $.08 above age 50

    • for salary levels above $120,000: $0.07 below age 50, $.10 above age 50

    Supplementary life insurance is not subject to criteria and is a flat $200,000 coverage and costs $7 month, paid for by the employee.

    There is a combined coverage limit of $500,000 for basic and supplementary insurance.

    Menu Path:

    IMG >Personnel Management>Benefits>Plans> Insurance Plans

    Steps:

    - Define insurance plan general data

    - Define coverage formula

    - Define coverage rules

    - Define cost variants

    - Define cost rules

    - Assign insurance plan attributes

    - Define evidence of insurability conditions

    Menu Path: (combined coverage)

    IMG >Personnel Management>Benefits>Plans> Insurance Plans>Combined coverage

    Steps:

    - Define combined coverage for insurance

    - Define combined coverage limit expressions

    13. A 401k savings plans is available and QD starts immediate matching. QD matches at a rate of 100% of employee contribution up to $1000. After this limit is reached, QD matches 50% of employee contribution to a maximum of 16% of the employee base salary. The 401k is subject to employee contribution groups (step 8). The maximum pre-tax employee contribution percents are explained in step #8 and the maximum dollar amount is $10,000. The employee is 20% vested after one year, and an additional 40% each year after.

    QD contributes $4000 to an RBAP for the salary employees after 1 year of service. Employees so not contribute to this plan and are 100% vested after 1 year. The RBAP is subject to an employer contribution rule (step 9).

    Choices for investments are stock, mutual funds, or both.

    Menu Path:

    IMG >Personnel Management>Benefits>Plans> Savings Plans

    Steps:

    • Define savings plan general data

    • Define employee contribution variants

    • Define employee contribution rules

    • Define employer contribution variants

    • Define employer contribution rules

    Menu Path:

    IMG >Personnel Management>Benefits>Plans> Savings Plans>Vesting

    Steps:

    • Define vesting rules

    • Define vesting portions

    Menu Path:

    IMG >Personnel Management>Benefits>Plans> Savings Plans>Investments

    Steps:

    • Define investments

    • Define investment groups

    • Assign investments to groups

    Menu Path:

    IMG >Personnel Management>Benefits>Plans> Savings Plans

    Steps:

    • Assign savings plan attributes

    14. QD offers a healthcare spending account with contribution limits of $100-$7000 per year. Reimbursements for spending accounts can be obtained through QD in amounts of $50 or greater. Valid reimbursements are doctor, dentist, vision, and prescription.

    Menu Path:

    IMG >Personnel Management>Benefits>Plans> Flexible Spending Accounts

    Steps:

    - Define spending account general data

    - Define employer contribution variants

    - Define employer contribution rules

    - Assign spending account attributes

    - Define spending account claim types

    15. QD gives each employee a monthly credit of $50 to offset the costs of benefit plans.

    Menu Path:

    IMG >Personnel Management>Benefits>Plans> Credit Plans

    Steps:

    • Define credit plan general data

    • Define credit variants

    • Define credit rules

    • Assign credit plan attributes

    16. QD offers a legal plan for all employees in the executive organizational unit. The coverage group was determined in step 7. The legal plan has a coverage amount of $5,000,000 and costs the employer $100 per month.

    you will use coverage amount and cost formulas for the legal plan configuration

    Menu Path:

    IMG >Personnel Management>Benefits>Plans> Miscellaneous Plans

    17. To enroll in a dental plan, the employee must be enrolling in either an HMO or the medical indemnity. To enroll in supplementary insurance, the employee must be enrolling in the basic life insurance plan.

    17a. Define prerequisite or corequisite plans

    Note: Prerequisite plan is a plan the employee must first be enrolled in.

    Corequisite plan is a plan the employee must enroll in at the same time.

    Menu Path:

    IMG >Personnel Management>Benefits>Flexible Administration>Prerequisites and \Corequisites>Define prerequisites/ Define corequisites

    Steps:

    • Choose a plan requiring a pre/co requisite

    • Enter the plan or plans that are to be the pre/co requisite

    • Determine if the plan requires a requisite of “all” or “any”

    18. Employees are eligible for all plans (except RBAP) immediately upon hire. Salary employees are eligible for RBAP after one year of service.

    18a. Define eligibility groupings

    Menu Path:

    IMG >Personnel Management>Benefits>Flexible administration>Programs>Employee Eligibility>Define eligibility groupings

    Steps:

    • Hit the “New entries” button

    • Enter Eligibility group and description

    • Hit the “Save” button

    18b. Maintain ELIGR feature

    Menu Path:

    IMG >Personnel Management>Benefits>Flexible administration>Programs>Employee Eligibility>Define eligibility groups

    Steps:

    • Click on “Feature” button and Maintain

    18c. Define eligibility variants

    Menu Path:

    IMG >Personnel Management>Benefits>Flexible administration>Programs>Employee Eligibility>Define eligibility variants

    Steps:

    • Hit the “New entries” button

    • Enter Eligibility rule variant and description

    • Hit the “Save” button

    18d. Define eligibility rules

    Menu Path:

    IMG >Personnel Management>Benefits>Flexible administration>Programs>Employee Eligibility>Define eligibility rule criteria

    Steps:

    • Select the eligibility rule for which to define conditions

    • Enter the waiting period information

    • Enter the first day of enrollment after waiting period met

    • Enter minimum working time and age restrictions, if required

    • Hit the “Save” button

    19. When employment ends, termination is classified as wither resigned or retired and benefit plans cease after 30 days, or cease immediately.

    19a. Define termination groupings

    Menu Path:

    IMG>Personnel Management>Benefits>Flexible administration>Programs>Participation termination>Define termination groupings

    Steps:

    • Hit the “New entries” button

    • Enter Termination grouping and description

    • Hit the “Save” button

    19b. Define termination variants

    Menu Path:

    IMG>Personnel Management>Benefits>Flexible administration>Programs>Participation termination>Define termination variants

    Steps:

    • Hit the “New entries” button

    • Enter Termination variants and description

    • Hit the “Save” button

    19c. Define termination rules

    Menu Path:

    IMG>Personnel Management>Benefits>Flexible administration>Programs>Participation termination>Define termination rules

    Steps:

    • Select your Termination rule

    • Select Benefits termination rule criteria

    • Enter the appropriate Coverage continuation period and hit the “Save” button

    20. Group plans together as an “offer” to active salary and hourly employees.

    20a. Define benefit programs

    Menu Path:

    IMG>Personnel Management>Benefits>Flexible administration>Programs>Define benefit programs

    Steps:

    • Select your Benefit groups

    • Select your Employee status

    • Enter the Benefit plan, Eligibility rule and Termination rule and hit the “Save” button.

    21. All active employees are defaulted into the traditional indemnity medical plan, low deductible, employee only if they do not elect benefits. The RBAP, credit, and legal plans are all automatic enrollment.

    21a. Define standard selections

    Menu Path:

    IMG>Personnel Management>Benefits>Flexible administration>Standard selections>Define Standard health selections

    Steps:

    • Select your Benefit groups

    • Select your Employee status

    • Hit the “New entries” button

    • Enter the Benefit plan type, Benefit plan, Health plan options and Dependent coverage for health plan

    • Select the processing type and hit the “Save” button.

    22. Benefit events are classified as Hire (can add all relevant plans) or Other Event (marriage, birth of child and can delete, add, change and relevant plan)

    22a. Define benefit adjustment groupings

    Menu Path:

    IMG>Personnel Management>Benefits>Flexible administration>Benefits adjustment reasons>Define benefit adjustment groupings

    Steps:

    • Hit the “New entries” button

    • Enter adjustment groupings and description

    22b. Maintain EVTGR feature

    Menu Path:

    IMG>Personnel Management>Benefits>Flexible administration>Benefits adjustment reasons>Define benefit adjustment groupings

    Steps:

    - Click on “Feature” button and maintain EVTGR feature

    22c. Define benefit adjustment reasons

    Menu Path:

    IMG>Personnel Management>Benefits>Flexible administration>Benefits adjustment reasons>Define benefit adjustment reasons

    Steps:

    • Hit the “New entries” button

    • Enter Benefit adjustment reasons and description

    • Hit the “Save” button

    22d. Define permitted changes for adjustment (up to you!)

    Menu Path:

    IMG>Personnel Management>Benefits>Flexible administration>Benefits adjustment reasons >Define adjustment permissions

    Steps:

    • Select your Benefit adjustment

    • Select your adjustment group

    • Hit the “New entries” button

    • Enter the Benefit plan type,

    • Check the appropriate boxes for Benefit plan, Options, Dependent coverage and Dependents and save your records

    At last assign ur wage type in PY >Philp > Benefits--- Do the necessary config here

    Collected from one of the previous thread...

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  • Posted on Mar 31, 2008 at 06:36 AM

    Benefit Administration:

    This section of the Implementation Guide (IMG) is where you set the SAP Benefits Administration component.

    Here you enter in the system all the details of the benefit plans offered by your company.

    Benefit Area:

    Benefit areas allow you to have separate administration of different benefit plan pools. This division is primarily for administrational purposes and would not normally be used for eligibility

    IMG Path: Personnel Management  Benefits  Basic Settings  Define Benefit Area

    Assign Currency to Benefit Area:

    In this step, you specify the currency for the benefit area

    IMG Path: Personnel Management  Benefits  Basic Settings  Assign Currency

    this step, you enter the providers of the benefit plans you offer.

    This could be the Insurance company, or Health Maintenance Organization that receives the benefit plan costs

    IMG Path: Personnel Management  Benefits  Basic Settings  Define Benefit Providers

    In this step, you set relevant benefit area for your Customizing activities

    If you have more than one benefit area to set up, you must set up each independently. After you have set up all the plans in one area, you must return to this view, set the next current benefit area and work through the IMG again, setting up the new benefit area.

    IMG Path: Personnel Management  Benefits  Basic Settings  Set Current Benefit Area

    Benefit Plan Types:

    In this step, you enter the benefit plan types that you require for the plan categories predefined in the system.

    The following plan categories are provided by MSD:

    • Health Plans

    o Medical

    o Dental

    o Vision

    • Insurance Plans

    o Basic Life

    o Supplemental Life

    o Accidental Death & Dismember

    • Savings Plans

    o 403B

    o 457

    o PERS (Public Employees retirement Scheme for CP Benefit Plan) & TRS

    (Teachers Retirement Scheme for TP Benefit Plan)

    • Flexible Spending Accounts

    o Health care

    o Dependent care

    IMG Path: Personnel Management  Benefits  Basic Settings  Plan Attributes  Define Benefit Plan Types

    Define Benefit Plan Status:

    It is important that you assigning statuses in order to be able to control the availability of plans with a minimum of effort. For example, you can control whether or not employees can enroll in a plan simply by changing its status

    IMG Path: Personnel Management  Benefits  Basic Settings  Plan Attributes  Define Benefit Plan Status

    Benefit Plan Status:

    In this step, you define parameter groups. You decide which groups you require in two stages:

    1. You consider which costs, credits, coverage and employee and employer contributions for your plans vary according to the age, salary and/or seniority of employees (or possibly the age of the employee's spouse).

    2. You determine the different ways in which you need to divide your employees according to different value ranges for these criteria.

    It is not possible to define overlaps of ranges for a criterion within a single parameter group. Therefore, if you require different employee groupings for different plans, you need to create a separate parameter group.

    For each unique combination of criteria and their values, you need to define a parameter group.

    In this step, you simply create the parameter groups to which you assign groups for the individual criteria in the following steps. You later refer to the parameter groups, where applicable, in the individual rule variants for plans. Since one parameter group can be referenced by multiple plans, Customizing effort is kept to a minimum. In the plan variant, you also have the flexibility of being able to specify that you only want to use certain criteria values belonging to a parameter group, for example, age ranges

    IMG Path: Personnel Management  Benefits  Basic Settings  Define Employee Groupings  Define Employee Criteria Groups  Define Parameter Groups

    Age Groups:

    In this step, you define the age groups for the parameter groups that you defined in a previous step.

    Depending on your needs, you may find for some parameter groups, you can leave out this step, if for example there is no requirement to differentiate between employees based on age

    IMG Path: Personnel Management  Benefits  Basic Settings  Define Employee Groupings  Define Employee Criteria Groups  Define Age Groups

    Age Groups under Parameter grouping “PAR1”

    Cost Groupings:

    In the parameter group you could differentiate between employees based upon age, salary and seniority. Here you can further differentiate between employees, based on other employee criteria, such as geographical location, job classification, marital status and so on. Only set up this feature, if you find that the parameter group does not adequately cover your needs, when specifying costs for different groups of employees

    IMG Path: Personnel Management  Benefits  Basic Settings  Define Employee Groupings  Define Cost Groupings

    Coverage Groupings:

    In the parameter group you could differentiate between employees based upon age, salary and seniority. Here you can further differentiate between employees, based on other employee criteria, such as geographical location, employment contract, residence status and so on. Only set up this feature, if you find that the parameter group does not adequately cover your needs, when specifying coverage for different groups of employees

    IMG Path: Personnel Management  Benefits  Basic Settings  Define Employee Groupings  Define Coverage Groupings

    Employee Contribution Groupings:

    In the parameter group you could differentiate between employees based upon age, salary and seniority. Here you can further differentiate between employees, based on other employee criteria, such as geographical location, weekly hours, residence status and so on. Only set up this feature, if you find that the parameter group does not adequately cover your needs, when specifying employee contribution for different groups of employees

    IMG Path: Personnel Management  Benefits  Basic Settings  Define Employee Groupings  Define Employee Contribution Groupings

    the parameter group you could differentiate between employees based upon age, salary and seniority. Here you can further differentiate between employees, based on other employee criteria, such as geographical location, weekly hours, residence status and so on. Only set up this feature, if you find that the parameter group does not adequately cover your needs, when specifying employee contribution for different groups of employees

    IMG Path: Personnel Management  Benefits  Basic Settings  Define Employee Groupings  Define Employer Contribution Groupings

    the parameter group you could differentiate between employees based upon age, salary and seniority. Here you can further differentiate between employees, based on other employee criteria, such as geographical location, weekly hours, residence status and so on. Only set up this feature, if you find that the parameter group does not adequately cover your needs, when specifying employee contribution for different groups of employees

    IMG Path: Personnel Management  Benefits  Plans  Health Plans  Define Employer Contribution Groupings

    the parameter group you could differentiate between employees based upon age, salary and seniority. Here you can further differentiate between employees, based on other employee criteria, such as geographical location, weekly hours, residence status and so on. Only set up this feature, if you find that the parameter group does not adequately cover your needs, when specifying employee contribution for different groups of employees

    IMG Path: Personnel Management  Benefits  Plans  Health Plans  Define Options for Health Plans

    Dependent Coverage Options:

    In this step, you define the dependent coverage that are used in health plans.

    Define all possible variations that you need, because this view is not specific to any plan or plan option

    IMG Path: Personnel Management  Benefits  Plans  Health Plans  Define Dependent Coverage Options

    Number of Dependents:

    In this step, you can restrict participation in a health plan under a dependent coverage option to certain types of dependent, as determined by the subtypes of the Family/Related Persons infotype (0021). You can also define a minimum and maximum number of persons of a particular type that can be covered. During enrollment, the system only includes those dependent coverage options in the benefit offer for which the appropriate dependents are available

    IMG Path: Personnel Management  Benefits  Plans  Health Plans  Define Minimum and Maximum Number of Dependents

    Define Cost Variants:

    In this step you define cost variants to determine which factors influence the cost of a health plan for an employee. Variants are plan-specific; each plan has its own variant(s).

    You do not enter any actual costs in this step. You simply define how costs vary according to:

    • Plan

    • Option

    • Dependent coverage

    • Employee data

    Before you start to define cost variants, you need to do the following:

    1. Determine how often costs vary for all the combinations of option and dependent coverage that you have defined in each plan.

    This indicates how many cost variants you need. You can use the same cost variant more than once, for example, if costs are always identical for the dependent coverages 'employee only' and 'employee plus family' within a plan, regardless of the plan option

    2. Determine how costs vary according to employee data.

    This determines how you need to set up your variants using employee groupings.

    For each variant, you can specify a parameter group and cost grouping to determine cost. You can also indicate whether the gender of employees and whether or not they are smokers are cost criteria

    IMG Path: Personnel Management  Benefits  Plans  Health Plans  Define Cost Variants

    Cost Rules:

    You need to define costs for each possible combination of employee grouping in the criteria you have attributed to each variant. If you have not specified any criteria in a variant, you assign one rule only

    IMG Path: Personnel Management  Benefits  Plans  Health Plans  Define Cost Rule

    Health Plan Attributes:

    In this step, you bring together all the definitions relevant to the health plan that you have made in the previous steps.

    You assign to each health plan:

    • Its options

    • Relevant dependent coverages

    • The cost variants for the combination of options and dependent coverages

    IMG Path: Personnel Management  Benefits  Plans  Health Plans  Assign Health Plan Attributes

    Insurance Plans:

    In this step, you define general data for insurance plans

    IMG Path: Personnel Management  Benefits  Plans  Insurance Plans  Define Insurance Plan General Data

    Coverage Variants:

    In this step, you define coverage variants to determined which factors influence the coverage an employee is entitled to in a plan. Variants are plan-specific; each plan has its own variant(s).

    You do not enter any actual coverage in this step. You simply define how coverage varies according to:

    • Plan

    • Coverage option

    • Employee data

    Before you start to define coverage variants, you need to do the following:

    1. Determine how often coverage varies for different coverage options.

    This indicates how many coverage variants you need. Note the following:

    • If a plan has set coverages (including salary multiples), you need a

    coverage variant for each.

    • If a plan allows employees to choose any amount of coverage within a

    range, you need only one coverage variant.

    • If a plan has options, you will need a coverage variant for each option.

    2. Determine how coverage varies according to employee data.

    This determines how you need to set up your variants using employee groupings. For each variant, you can specify a parameter group and coverage grouping to determine coverage

    IMG Path: Personnel Management  Benefits  Plans  Insurance Plans 

    Coverage Rules:

    In this step, you define the actual coverages for a plan.

    You need to define coverage for each possible combination of employee grouping in the criteria you have attributed to each variant. If you have not specified any criteria in a variant, you assign one rule only.

    Coverage can be defined as a flat amount or as a factor of salary

    IMG Path: Personnel Management  Benefits  Plans  Insurance Plans  Define Coverage Rules

    Cost Variants:

    In this step you define cost variants to determine which factors influence the cost of an insurance plan for an employee. Variants are plan-specific; each plan has its own variant(s).

    You do not enter any actual costs in this step. You simply define how costs vary according to:

    • Plan

    • Coverage option

    • Employee data

    Before you start to define cost variants, you need to do the following:

    1. Determine how often cost varies for different coverage options:

    • If an insurance plan has set flat coverage options and flat costs, you need

    to define a cost variant for each flat cost.

    • If you have set flat coverage options and the flat costs are directly

    proportional to the coverage stated in the flat cost, you need only one

    cost variant.

    • If an employee can choose any amount of coverage within a range and the

    cost of the coverage is directly proportional to the coverage, you need

    only one cost variant.

    2. Determine how costs vary according to employee data.

    This determines how you need to set up your variants using employee groupings.

    For each variant, you can specify a parameter group and cost grouping to determine cost. You can also indicate whether the gender of employees and whether or not they are smokers are cost criteria

    IMG Path: Personnel Management  Benefits  Plans  Insurance Plans  Define Cost Variants

    Cost Rules:

    You need to define costs for each possible combination of employee grouping in the criteria you have attributed to each variant. If you have not specified any criteria in a variant, you assign one rule only

    IMG Path: Personnel Management  Benefits  Plans  Insurance Plans  Define Cost Rules

    Insurance Plan Attributes:

    In this step, you bring together all those parts of an insurance plan, that you have already defined in the previous few steps.

    You define the insurance plan options, then associate to each insurance plan:

    • Cost variant

    • Coverage variant

    IMG Path: Personnel Management  Benefits  Plans  Insurance Plans  Assign Insurance Plan Attributes

    Combined Coverage Limits:

    When you define coverages for plans such as insurance, you can set limits on the coverage amount. This is often used when the coverage is an amount dynamically calculated when the employee chooses her coverage.

    However these limits apply only to one plan and yet you might need to define limits which combine the coverages of more than one plan.

    In this chapter, you define these combined limits as follows:

    1. The limit that might span 2 or more plans is reduced to a mathematical equation, where there is an amount on one side and plan coverages on the other side. The two sides of this equation are then DIVIDED BETWEEN the two views in this chapter.

    2. The first view defines the limit in monetary terms which is one side of the equation. It also defines the operator (equals, is greater than, and so on).

    3. The second view defines the other side of the equation in terms of the plan coverages

    IMG Path: Personnel Management  Benefits  Plans  Insurance Plans  Combined Coverage  Combined Coverage

    Combined Coverage Limit Expressions:

    In this step, you enter the second half of the equation, as discussed in combined coverage

    IMG Path: Personnel Management  Benefits  Plans  Insurance Plans  Combined Coverage  Define Combined Coverage Limit Expressions

    Imputed Income for Selected Benefits:

    In this section of the IMG, you define the criteria needed to calculate Imputed Income.

    Imputed Income is based upon benefits paid for by the employer and calculated using rates set by the Internal Revenue Service (IRS). This value is then treated as taxable income for the employee

    IMG Path: Personnel Management  Benefits  Plans  Insurance Plans  Combined Coverage  Review Age Groups for Imputed Income

    Review Calculation Factors for Imputed Income:

    In this step, you check that the Imputed Income Rate Table entries are correct.

    The imputed income age groups are associated with the rates/factors set by the IRS

    IMG Path: Personnel Management  Benefits  Plans  Insurance Plans  Combined Coverage  Review Calculation Factors for Imputed Income

    Savings Plans:

    In this step, you define general data for savings plans.

    You have defined the relevant type, status, and provider for each plan in the Basic Settings section of the Benefits IMG

    IMG Path: Personnel Management  Benefits  Plans  Savings Plans  Define Savings Plan General Data

    Employee Contribution Variants:

    In this step you define employee contribution variants to determine which factors influence the permitted employee contribution to a plan. Variants are plan-specific; each plan has its own variant(s).

    You do not enter any actual contributions in this step. You simply define how contributions vary according to:

    • Plan

    • Option (only for plans in the plan category Miscellaneous)

    • Employee data

    Before you start to define variants, you need to do the following:

    1. Determine how often employee contributions vary for plans and any plan options.

    This indicates how many contribution variants you need.

    2. Determine how employee contributions vary according to employee data.

    This determines how you need to set up your variants using employee groupings.

    For each variant, you can specify a parameter group and employee contribution grouping to determine employee contribution

    IMG Path: Personnel Management  Benefits  Plans  Savings Plans  Define Employee Contribution Variants

    Employee Contribution Rules:

    In this step, you define the employee contribution limits for each plan.

    You need to define employee contributions limits for each possible combination of employee grouping in the criteria you have attributed to each variant. If you have not specified any criteria in a variant, you assign one rule only.

    You can define minimum and maximum employee contribution in the following ways:

    • As a fixed amount

    • As a percentage of salary

    • As a contribution unit

    In Payroll, the total employee contribution is the sum of these amounts

    IMG Path: Personnel Management  Benefits  Plans  Savings Plans  Define Employee Contribution Rules

    Employer Contribution Variants:

    In this step you define employer contribution variants to determine which factors influence the contribution the employer makes to a plan. Variants are plan-specific; each plan has its own variant(s).

    You do not enter any actual contribution in this step. You only define how contributions vary according to:

    • Plan

    • Option (only for plans in the plan category Miscellaneous)

    • Employee data

    Before you start to define variants, you need to do the following:

    1. Determine how often employee contributions vary for plans and any plan options.

    This indicates how many contribution variants you need.

    2. Determine how employee contributions vary according to employee data.

    This determines how you need to set up your variants using employee groupings.

    For each variant, you can specify a parameter group and employer contribution grouping to determine employer contribution

    IMG Path: Personnel Management  Benefits  Plans  Savings Plans  Define Employer Contribution Variants

    Employer Contribution Rules:

    In this step, you define limits for the contributions made by the employer to employee plans. You so this for each employer contribution variant for each plan.

    You need to define employer contributions limits for each possible combination of employee grouping in the criteria you have attributed to each variant. If you have not specified any criteria in a variant, you assign one rule only.

    You can define the employer contribution and the contribution limit in either of the following ways:

    • As a fixed amount / as an amount per unit contributed by the employee

    • As a percentage of employee base salary or employee contribution

    IMG Path: Personnel Management  Benefits  Plans  Savings Plans  Define Employer Contribution Rules

    Assign Savings Plan Attributes:

    In this step, you complete the definition of savings plans by bringing together the relevant elements that you have already defined:

    • EE contribution variant

    • ER contribution variant

    IMG Path: Personnel Management  Benefits  Plans  Savings Plans  Assign Savings Plan Attributes

    Flexible Spending Accounts (FSAs):

    In this step, you define general data for flexible spending accounts (FSAs).

    Requirements

    You have created the appropriate plan type , plan status, and benefit provider in the preceding steps

    IMG Path: Personnel Management  Benefits  Plans  Flexible Spending Accounts (FSAs)  Define Spending Account General Data

    Assign Spending Account Attributes:

    In this step, you enter the details of your flexible spending accounts including contribution limits, an employer contribution variant (if required), and rules for the reimbursement of claims

    IMG Path: Personnel Management  Benefits  Plans  Flexible Spending Accounts (FSAs)  Assign Spending Account Attributes

    Flexible Administration:

    In this chapter, you define the flexible aspects of your Benefits administration. You define the availability of plans to your employees, in terms of the plans themselves. You also define aspects of the enrollment process.

    you enter parameters that apply to processing within an entire benefits area, including:

    • Open enrollment period dates

    • Default validity dates for adjustment/standard plan records

    • Advance availability of future plans

    • Dependent age limits

    IMG Path: Personnel Management  Benefits  Flexible Administration  Define Administrative Parameters

    Benefit Adjustment Groupings:

    In this step, you define adjustment groupings. These groupings allow you to specify different adjustment permissions for different groups of employees

    IMG Path: Personnel Management  Benefits  Flexible Administration  Benefits Adjustment Reasons  Define Benefit Adjustment Groupings

    Benefit Adjustment Reasons:

    In this step, you define adjustment reasons to control changes to employee enrollments according to company policy.

    The adjustment reason types that you define here are assigned as subtypes of Adjustment Reasons records (infotype 0378) in HR Master Data. Since a record can only have one subtype, a new record must be created for every adjustment reason an employee experiences.

    According to the adjustment concept, an employee can only make changes to her enrollments if she has an Adjustment Reasons record (infotype 0378) with the required adjustment reason as a subtype. The only exceptions to this are if changes are made during an open enrollment period or if an anytime adjustment reason is assigned to the plan type.

    In addition to defining adjustment reasons for certain events that can trigger changes, you may also want to define a special adjustment reason to allow changes to plans at any time

    IMG Path: Personnel Management  Benefits  Flexible Administration  Benefits Adjustment Reasons  Define Benefit Adjustment Reasons

    Adjustment Permissions:

    In this section, you assign adjustment permissions to each benefit plan type for an adjustment reason and any adjustment grouping that you have defined.

    Note that the elements for which you can define permissions are automatically determined by the system, dependent on the plan category

    Health Plans:

    In this step, you define the changes permitted for all plans of this type. You do this for each combination of adjustment reason, adjustment grouping, and plan type

    IMG Path: Personnel Management  Benefits  Flexible Administration  Benefits Adjustment Reasons  Define Adjustment Permissions  Health Plans

    this step, you define the changes permitted for all plans of this type. You do this for each combination of adjustment reason, adjustment grouping, and plan type

    IMG Path: Personnel Management  Benefits  Flexible Administration  Benefits Adjustment Reasons  Define Adjustment Permissions  Insurance Plans

    Savings Plans:

    In this step, you define the changes permitted for all plans of this type. You do this for each combination of adjustment reason, adjustment grouping, and plan type

    IMG Path: Personnel Management  Benefits  Flexible Administration  Benefits Adjustment Reasons  Define Adjustment Permissions  Savings Plans

    Spending Accounts:

    In this step, you define the changes permitted for all plans of this type. You do this for each combination of adjustment reason, adjustment grouping, and plan type

    IMG Path: Personnel Management  Benefits  Flexible Administration  Benefits Adjustment Reasons  Define Adjustment Permissions  Spending Account

    Programs:

    In this section of the IMG, you define benefit programs and the eligibility restrictions and termination conditions for the plans within these programs.

    Within a program, eligibility for plans can be determined on two levels:

    • Program groupings control eligibility on a high level (macro-eligibility) by allocating an employee a defined program, depending on his/her organizational and employment data.

    • Eligibility rules are optional and control eligibility on a low level (micro-eligibility) by determining whether an employee can participate in a plan within the relevant program. An employee must fulfill the conditions defined in the rule in order to be able to enroll. Eligibility rules are assigned to plans in programs by means of an eligibility variant.

    First Program Grouping:

    In this step, you define first program groupings. Later, you define programs for a combination of first and second program groupings.

    Identical attributes are available for the setup of both the first and second program groupings, and they are therefore interchangeable. The fact that you determine macro-eligibility for a program using two dimensions means that you are able to make finer distinctions between groups of employees

    IMG Path: Personnel Management  Benefits  Flexible Administration  Programs  Define First Program Grouping

    Second Program Grouping:

    In this step, you define second program groupings. Later, you define programs for a combination of first and second program groupings.

    Identical attributes are available for the setup of both the first and second program groupings, and they are therefore interchangeable. The fact that you determine macro-eligibility for a program using two dimensions means that you are able to make finer distinctions between groups of employees

    IMG Path: Personnel Management  Benefits  Flexible Administration  Programs  Define Second Program Grouping

    Employee Eligibility:

    In this section of the IMG, you define the criteria according to which you control eligibility for individual benefit plans within a benefits program (definition of micro-eligibility). You perform the following steps to set up eligiblity requirements:

    • You define eligibility grouping to identify groups of employees for whom

    certain eligibility criteria apply.

    • You create eligibility variants, which you later use to link eligibility

    rules to programs.

    • If necessary, you define dynamic eligibility conditions relating

    specifically to actual hours worked/length of service, or zip codes.

    • You bring your definitions together in the eligibility rule, where you

    can also specify further conditions for enrollment.

    IMG Path: Personnel Management  Benefits  Flexible Administration  Programs  Employee Eligibility  Define Eligibility Groupings

    Eligibility Variants:

    In this step, you define eligibility variants. These consist simply of an identifier and a description

    IMG Path: Personnel Management  Benefits  Flexible Administration  Programs  Employee Eligibility  Define Eligibility Variants

    Eligibility Rules:

    In this step, you define eligibility rules for the benefit plans offered by your organization. You define these rules for combinations of eligibility grouping and eligibility variant, thereby determining the eligibility conditions that will apply for different groups of employees

    IMG Path: Personnel Management  Benefits  Flexible Administration  Programs  Employee Eligibility  Define Eligibility Rules

    Participation Termination:

    In this section of the implementation guide you define criteria for the termination of benefit plans

    Termination Groupings:

    In this section of the implementation guide you define criteria for the termination of benefit plans

    IMG Path: Personnel Management  Benefits  Flexible Administration  Programs  Participation Termination  Define Termination Groupings

    Termination Variants:

    In this step, you define termination variants. These consist simply of an identifier and a description

    IMG Path: Personnel Management  Benefits  Flexible Administration  Programs  Participation Termination  Define Termination Variants

    Termination Rules:

    In this step, you define termination rules. You define these rules for every combination of termination grouping and termination variant, thereby determining the coverage continuation periods and termination day that will apply for different groups of employees

    IMG Path: Personnel Management  Benefits  Flexible Administration  Programs  Participation Termination  Define Termination Rules

    Define Benefit Programs:

    In this step, you define termination rules. You define these rules for every combination of termination grouping and termination variant, thereby determining the coverage continuation periods and termination day that will apply for different groups of employees

    IMG Path: Personnel Management  Benefits  Flexible Administration  Programs  Define Benefit Programs

    Dependent/Beneficiary Eligibility:

    In this step, you define family member groupings and determine how family members are allocated to these groupings

    IMG Path: Personnel Management  Benefits  Flexible Administration  Dependent/Beneficiary Eligibility  Define Family Member Groupings

    Dependent Eligibility Rule Variants:

    In this step, you define the dependent eligibility variants to which you want to assign dependent eligibility rules. You also specify whether you wish to use a family member grouping in the associated eligibility rule to restrict eligibility to types of family members with certain characteristics

    IMG Path: Personnel Management  Benefits  Flexible Administration  Dependent/Beneficiary Eligibility  Define Dependent Eligibility Rule Variants

    Dependent Eligibility Rules:

    In this step, you define dependent eligibility rules to determine which types of family member are eligible as dependents. You then assign your rules to the appropriate plans by means of a rule variant in the step Assign Eligibility Rule Variant to Plan

    IMG Path: Personnel Management  Benefits  Flexible Administration  Dependent/Beneficiary Eligibility  Define Dependent Eligibility Rules

    Beneficiary Eligibility Rule Variants:

    In this step, you define the beneficiary eligibility variants to which you assign beneficiary eligibility rules in the next step. You also specify the following:

    • Whether you want to use a family member grouping in the associated eligibility rule to restrict eligibility to types of family members with certain characteristics

    • Whether the following apply for plans to which the variant is assigned:

     The employee can be a beneficiary

     Contingency beneficiaries can be named

     Spouse approval is required if beneficiaries other than the spouse are to be amed (the system only takes this setting into consideration for plans of the category avings)

    IMG Path: Personnel Management  Benefits  Flexible Administration  Dependent/Beneficiary Eligibility  Define Beneficiary Eligibility Rule Variants

    Beneficiary Eligibility Rules:

    In this step, you define beneficiary eligibility rules to determine which types of family member are eligible as beneficiaries. You then assign your rules to the appropriate plans by means of a rule variant in the step Assign Eligibility Rule Variant to Plan

    IMG Path: Personnel Management  Benefits  Flexible Administration  Dependent/Beneficiary Eligibility  Define Beneficiary Eligibility Rules

    Assign Eligibility Rule Variant to Plan:

    In this step, you assign dependent eligibility variants and beneficiary eligibility variants to plans, thereby assigning the eligibility rules associated with these variants

    IMG Path: Personnel Management  Benefits  Flexible Administration  Dependent/Beneficiary Eligibility  Assign Eligibility Rule Variant to Plan

    COBRA Plans:

    In this step, you specify which health plans that you have already defined in the system are COBRA-relevant.

    When a clerk collects COBRA-qualified beneficiaries, the system only considers employee enrollments in the plans you select here as legitimate cases where COBRA must be offered to the employee

    IMG Path: Personnel Management  Benefits  COBRA  Choose COBRA Plans

    this step, you determine for which flexible spending accounts (FSAs) you will offer continuation of coverage under COBRA. You need to do this for each benefit area separately

    IMG Path: Personnel Management  Benefits  COBRA  Choose COBRA Spending Accounts

    Qualifying Event Coverage Periods:

    In this step, you define the events that qualify individuals for COBRA coverage, and the periods of permitted coverage continuation for each qualifying event type. COBRA legislation states the following regarding coverage continuation periods:

    • In the case of Termination of employment and Reduction in working hours, only 18 months coverage must be provided. If qualified beneficiaries are determined to be disabled within 60 days of the COBRA event, they are entitled to a further 11 months of coverage, as are the other qualified beneficiaries who experienced the original event.

    • For all other qualifying events except Bankruptcy of employer, a qualified beneficiary is entitled to 36 months continuation coverage, and there is no extension provision for disability.

    • In the case of the event Bankruptcy of employer, the coverage continuation period is the life of the retired employee or retired employee's widow/widower. You therefore do not need to define a continuation period in this case.

    IMG Path: Personnel Management  Benefits  COBRA  Define Qualifying Event Coverage Periods

    Assign COBRA Events to Personnel Actions:

    In this step, you define how the system recognizes COBRA-qualifying events from employee personnel actions (infotype 0000) records. You do this by creating a link between the two.

    The only COBRA-qualifying event types that you assign to personnel actions are:

    • Termination

    • Death of employee

    • Reduction in hours

    You need to assign these COBRA-qualifying event types since they are based on customizable entries in your HR master data and therefore cannot be delivered as standard.

    When the system collects COBRA-qualified beneficiaries, it considers employee records within the date range you specify in two stages as follows:

    1. The system searches for employee personnel action (infotype 0000) records. The COBRA qualifying events assigned to any personnel actions found are collected.

    2. The system checks other employee infotype records for specific information which corresponds to COBRA-qualifying event types

    IMG Path: Personnel Management  Benefits  COBRA  Assign COBRA Events to Personnel Actions

    Notification and Payment Intervals:

    In this step, you define details of COBRA administration for those states where state law concerning COBRA differs from federal law.

    Federal regulations are reflected in the state settings for the District of Columbia, which is also the system default.

    If you must comply with state regulations that differ from the federal regulations, you should create a new state entry. Otherwise, you can use the DC version for all employees, regardless of which state they reside in

    IMG Path: Personnel Management  Benefits  COBRA  Define Notification and Payment Intervals

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