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Broker Employer Contributions

Employer Contributions

Employer Contributions define how premium costs are shared between the Employer and employees for a specific Group (plan year). MonarkHQ provides flexible tools to configure contribution strategies including percentage-based contributions, flat dollar amounts, job class–specific rules, contribution caps, and base plan pricing.

1. Understanding Employer Contributions

What Are Employer Contributions?

When an Employer offers benefits, they typically pay part of the premium (Employer Contribution) and the employee pays the remainder (Employee Contribution, often called payroll deduction).

Example

  • Plan premium: $500/month
  • Employer Contribution: 80% = $400
  • Employee Cost: 20% = $100

Where Contributions Apply in MonarkHQ

Employer Contributions are configured inside a Proposal and apply to:

  • A specific Group (plan year)
  • A specific Coverage Type (e.g., Medical, Dental)
  • One or more plan options within that coverage type

Important:

Contributions are not global settings for the Employer. They are usually plan-year specific and often vary by coverage type.

Once configured, contribution details — including per-member breakdowns — are visible in the offer comparison view and read-only offer views for all coverage types, including Life & AD&D, Disability, Dental, Vision, Accident, Hospital Indemnity, and Critical Illness. You do not need to navigate to a separate contributions page to see how contributions affect each line of coverage.

Key Concepts

| Term | Definition | | ---------------------- | ------------------------------------------------------------------ | | Employer Contribution | What the Employer pays toward premium | | Employee Contribution | What the employee pays via payroll deduction | | Dependent Contribution | Employer’s contribution toward dependent coverage (if offered) | | Job Class | Employee classification used to apply different contribution rules | | Base Plan Pricing | Contribution pegged to a reference “base” plan | | Contribution Cap | Maximum dollar amount the Employer will contribute |

2. Access Contribution Configuration

Employer Contributions are configured within the quoting workflow for a Proposal:

  1. Navigate to the Proposal
  2. Go to the Quotes tab
  3. Select a Coverage Type
  4. Expand Employer Contribution Configuration

Note:

Life & AD&D is the exception. The Life configure page has no Employer Contribution Configuration box. Each life plan's contribution basis is set automatically from the census: employer-paid life is treated as 100% employer-paid and voluntary life as 100% employee-paid. That basis is stated as a Contribution Basis row on the carrier RFP sheet and on the Life sheet of the proposal export.

3. Contribution Types

Percentage-Based Contributions

The Employer pays a percentage of the premium.

Configuration

| Field | Description | Example | | ------------- | ------------------------------------- | ------- | | To Employees | Percentage for employee-only coverage | 80% | | To Dependents | Percentage for dependent coverage | 50% |

How It Works

  • Employee-only premium: $400 × 80% = $320 Employer / $80 employee
  • Dependent premium: $600 × 50% = $300 Employer / $300 employee

Flat Dollar Contributions

The Employer pays a fixed dollar amount per tier.

Configuration

| Field | Description | Example | | ------------- | --------------------------------------- | ------- | | To Employees | Dollar amount toward employee coverage | $350 | | To Dependents | Dollar amount toward dependent coverage | $200 |

How It Works

  • If a plan costs $400, Employer pays $350, employee pays $50
  • If a plan costs $300, Employer pays $300 (up to the $350 limit), employee pays $0

Flat amounts and caps can include cents, for example $160.50. Whole-dollar amounts display without decimals ($150), and amounts with cents always show two decimals, so a saved value is never shown rounded.

Note:

MonarkHQ will not calculate negative payroll deductions. Employer contribution is capped implicitly at the premium amount.

4. Configure Basic Contributions

Step-by-Step

  1. Open the Configuration Panel
    • Find Employer Contribution Configuration
    • Click to expand if collapsed
  2. Enable Contributions
    • Toggle Apply Contributions to ON
    • This activates contribution calculations
  3. Select Contribution Type
    • Choose Percentage or Flat Amount
  4. Enter Values
    • Enter employee contribution value
    • Enter dependent contribution value (if applicable)
  5. Save
    • Click Save Contributions
    • Updated contribution logic applies to premium calculations and member breakdowns

Default Values

When you create a new contribution configuration, defaults are:

  • Type: Percentage
  • Employees: 80%
  • Dependents: 50%

5. Configure Job Class Rules

Different employee segments may receive different Employer Contribution levels. MonarkHQ supports job class-based contributions using job class values from the Census.

What Are Job Classes?

Job classes are employee classifications in your census data, such as:

  • Executive
  • Management
  • Hourly
  • Part-Time
  • Union

Configuring Job Class Contributions

  1. Click + Add Job Class Contribution
  2. Choose a job class:
    • All Employees (default baseline rule)
    • A specific job class from the census
  3. Enter contribution values for employees and dependents
  4. Repeat for any additional job classes

A new row starts on All Employees when no other row already uses it. The row doesn't count until you enter an amount, so the default alone never changes pricing or saves a rule.

Job Class Priority

When calculating contributions for an employee:

  1. MonarkHQ checks for a rule that matches the employee’s job class
  2. If found, it applies that job class rule
  3. If not found, it falls back to the All Employees rule

Example

| Job Class | Employee | Dependent | | ------------- | -------- | --------- | | Executive | 100% | 100% | | Management | 90% | 75% | | All Employees | 80% | 50% |

Tip:

If job class logic isn’t behaving as expected, validate that the job class values in the census match exactly (spelling, capitalization, extra spaces).

Job Classes in Proposal Exports

When a Group has contribution rules for more than one job class, the Employer Contributions section of each coverage sheet in the Excel proposal export lists one row per job class instead of a single split. Each row is labelled with the job class name (the baseline rule appears as All Employees) and shows the split for each plan column, for example EE 80% / DEP 50%, or dollar amounts for flat contributions. A plan with no rule for that class shows a dash.

Groups with a single All Employees rule keep the familiar Contribution Type / Employee / Dependent rows.

6. Configure Contribution Caps (Maximum Amount)

For percentage-based contributions, you can set a maximum Employer Contribution amount to limit exposure on high-cost plans.

When to Use Caps

  • Control Employer cost on rich plans
  • Maintain budget predictability
  • Encourage cost-conscious plan selection

How to Configure Caps

  1. Set contribution type to Percentage
  2. Find the Max Amount field
  3. Enter the maximum dollar contribution
  4. Leave blank for no cap

Example

  • Configuration: 80% with a $400 cap
  • Plan A premium $400 → 80% = $320 (under cap)
  • Plan B premium $600 → 80% = $480, capped to $400

7. Configure Base Plan Pricing

Base Plan Pricing is an advanced strategy where the Employer Contribution is calculated from a selected base plan, rather than the plan the employee chooses.

How Base Plan Pricing Works

  1. Choose a Base Plan (often a lower-cost plan option)
  2. Set Employer Contribution as a percentage of the base plan premium
  3. Employees who select a higher-cost plan pay the difference (buy-up)

Example

Base Plan: Bronze PPO = $350/month

Employer Contribution: 80% of base = $280

| Plan Selected | Premium | Employer Pays | Employee Pays | | ----------------- | ------- | ------------- | ------------- | | Bronze PPO (base) | $350 | $280 | $70 | | Silver PPO | $450 | $280 | $170 | | Gold PPO | $550 | $280 | $270 |

How to Configure Base Plan Pricing

  1. Toggle Use Base Plan Pricing to ON
  2. Select the Base Plan from the dropdown
    • (Only plans available in this coverage type appear)
  3. Enter the base plan contribution percentage
  4. Click Save Contributions

Benefits of Base Plan Pricing

  • Predictable Employer cost even when employees buy up
  • More employee choice with transparent trade-offs
  • Cleaner decision-making in the Proposal

8. View Per-Member Breakdown

Once contributions are configured, MonarkHQ calculates payroll deductions and Employer cost at the member level.

How to View

  1. Open a quote or plan option with contributions configured
  2. Click View Member Breakdown
  3. Review per-member allocations

What the Breakdown Shows

| Column | Description | | -------------- | ----------------------- | | Member | Employee or dependent | | Relationship | Employee, Spouse, Child | | Plan | Plan option | | Total Premium | Full premium | | Employer Share | Amount Employer pays | | Employee Share | Payroll deduction |

Members are listed by last name, then first name. Each household stays together under its employee.

How Calculations Work

For each employee:

  1. Determine the correct contribution rule (job class or default)
  2. Identify premium tier
  3. Apply percentage or flat amount
  4. Apply any caps
  5. Calculate remaining employee cost

9. Example Contribution Scenarios

Scenario 1: Simple Percentage

  • Employees: 75%
  • Dependents: 50%

Result:

  • Employee-only $400 → Employer $300 / Employee $100
  • Family tier calculated using dependent contribution rules

Scenario 2: Flat Amount with Dependent Gap

  • Employees: $400
  • Dependents: $100

Result:

  • Employee-only $450 → Employer $400 / Employee $50
  • Adding spouse tier increases employee cost significantly

Scenario 3: Executive Carve-Out

  • Executives: 100% / 100%
  • All Others: 80% / 50%

Result:

  • Executives pay $0
  • Others pay the remainder based on tiers

Scenario 4: Base Plan with Buy-Up

  • Base Plan: HMO Basic ($300)
  • Contribution: 90% of base

Result:

  • Base plan → Employer $270 / Employee $30
  • PPO $500 → Employer $270 / Employee $230

10. Employer Contribution Best Practices

Align With Employer Strategy

  • Match contribution structure to budget and competitiveness
  • Use caps and base plan pricing when cost control matters

Use Job Classes Carefully

  • Only create job class rules that reflect real differences
  • Confirm census job class values before configuring rules

Model Employee Impact

  • Review employee payroll deductions across plan options
  • Ensure buy-up scenarios are clearly shown in the Proposal

Document the Base Plan

  • Clearly label which plan is used as the base
  • Explain base plan pricing in Proposal materials

11. Troubleshooting

Contributions Not Calculating

  • Confirm Apply Contributions is ON
  • Click Save Contributions
  • Confirm quote data exists for the selected plan

Wrong Job Class Applied

  • Validate job class values in the census match exactly
  • Check for extra spaces or typos
  • Confirm an All Employees default exists

Base Plan Not Available

  • Ensure plans are added/configured for that coverage type
  • Save the quote/plan selections before choosing a base plan
  • Refresh if plans were just added

Next Steps

Once contributions are set, continue with: