It is not new money. That is the whole point, and it is also why the idea sounds wrong the first time you hear it.
Employee contributions come out pre-tax. That lowers the wage base both the agency and the caregiver pay FICA on. The employer payroll tax that stops going out is what funds the benefits.
The plan is built to run at zero net cost to the agency. Most caregivers see the same or a slightly larger net paycheck than before.
Section 125 has been in the Internal Revenue Code since 1978. It is the same provision that has funded pre-tax benefits for a large share of American employers for decades. We walk through how a Section 125 wellness plan works for a home care agency in more detail.
Most owners have already run these numbers. Here is what they found.
| Option | What it costs a 40-caregiver agency | Where the money comes from |
|---|---|---|
| $2/hr raise | $134,360 a year | New money. At a 7 to 10 percent margin, that is the whole margin. |
| Traditional group health | Roughly $134,000 a year in premium | New money, and most part-time caregivers are not eligible anyway. |
| Section 125 wellness plan | Built to run at zero net cost | Employer payroll tax you are already paying. |
A $2 an hour raise on a 30-hour caregiver is $3,120, plus 7.65 percent employer FICA, so $3,359 per caregiver per year. Across 40 caregivers that is $134,360.
Headcount, average hours, and pay range. That is enough to get started and to tell you quickly whether this is worth pursuing.
A proposal modeled on your actual roster rather than industry averages. It shows who qualifies, who does not, and what the employer figure looks like. Usually back in a day or two. Free, no obligation.
The CBIZ compliance opinion and the HitesmanLaw legal assurance go to you before you sign anything. We would rather your accountant check our work than have you take our word for it.
They handle the communication, the enrollment meetings and the questions. Roughly 95 percent of the work is theirs, not yours.
Payroll specialists work directly with your team or your payroll provider on code setup and rollout.
Caregivers complete a health risk assessment and a qualifying wellness activity each month. Participation is what makes the structure defensible, and it is not a paperwork exercise.
"My caregivers are part-time. They would not qualify."
That sentence ends more of these conversations than any other, and it comes from a reasonable place. Every group health quote an owner has ever seen was built around a 30-hour eligibility threshold.
That threshold is a group carrier rule. It is not tax law. A Section 125 election is open to W-2 employees regardless of hours worked. What varies with hours is how much each person gains, not whether they can participate.
For an agency where half the roster never reaches full-time, that is the difference between a plan that covers the office and one that covers the schedule.
Across the proposals we have run, the employer figure has landed somewhere between $300 and $900 per participating employee per year. UnifyWell's own published example nets roughly $640 per participating employee on a $44,000 earner, after the monthly administration fee. Caregiver wages generally sit below that.
That is a range, not a quote. Not every caregiver qualifies, and the number moves with wages, filing status and pay schedule.
The question the range cannot answer is which of your caregivers qualify and what lands on their check. Only your own numbers settle that, which is why the proposal exists.
Move three sliders and see what your agency already pays in employer payroll tax, what turnover is costing you, and what could be redirected instead.
Open the estimatorHome Care Wellness provides marketing and enrollment support and does not provide legal, tax, accounting or health advice. The Unify Wellness Plan is administered by UnifyWell and ACA Solutions. Savings figures in any proposal are estimates based on the payroll information provided and are not guaranteed. Federal and state tax laws change. Consult your own CPA or attorney before enrolling.