For today’s employers, balancing rising healthcare costs with the need to offer meaningful benefits isn’t easy. You want to support your team and stay competitive, but without blowing up your bottom line. That’s exactly where a Section 125 plan, also known as an employee benefits cafeteria plan, comes in.
With the right strategy, a Section 125 plan can help employers reduce payroll taxes, lower healthcare claims, and boost employee satisfaction, all at zero cost to the business. And when you pair this structure with BrightPath Group’s BrightPath Advantage program, the benefits grow exponentially.
Here’s what every employer should know.
What Is a Section 125 Plan?
A Section 125 cafeteria plan helps employees pay for healthcare with pre-tax dollars, while employers save on payroll taxes. BrightPath Advantage goes further, combining compliance, automation, and $0 copay care with family coverage, life insurance, and mental health support. Employers save up to $1,100 per W-2 annually, with zero cost and fast 30–45 day setup.
A Section 125 plan is a benefits structure defined by the IRS that allows employees to contribute immensely to a few of the health-related benefits using pre-tax dollars. The term “cafeteria plan” comes from the flexibility these plans offer, employees can choose from a menu of benefit options, typically including:
- Health insurance premiums
- Dental and vision coverage
- Flexible Spending Accounts (FSAs)
- Dependent care benefits
- Group Term Life Insurance
Because contributions are deducted before taxes, the employee’s taxable income goes down, and the employer’s payroll tax liability is also reduced.
BrightPath Advantage: A Smarter Section 125 Plan
Traditional cafeteria plans only scratch the surface. The BrightPath Advantage program transforms a standard Section 125 plan into a fully compliant, tax-efficient, and wellness-driven solution.
This plan doesn’t just include Section 125, it enhances it by combining:
- A Preventive Care Management Plan (PCMP)
- A Specialized Insurance Medical Reimbursement Plan (SIMRP)
All of this is fully automated, cost-free, and built to help employers unlock significant tax and healthcare savings, without changing existing coverage.
How Employers Benefit from BrightPath Advantage
When implemented correctly, a Section 125 plan can help you reduce costs. But with BrightPath Advantage, employers experience next-level savings and value, including:
- $1,100 saved annually per W-2 employee
- 5–10% average reduction in healthcare costs
- No out-of-pocket cost to get started
- Seamless 30–45 day implementation
- No disruption to current insurance plans
- Increased retention, recruitment appeal, and employee satisfaction
That’s $110,000 in yearly savings for every 100 W-2 employees. And the best part? We manage the entire process for you, from compliance to communications.
Why Employees Love the BrightPath Advantage
The BrightPath Advantage plan delivers a rich benefits experience that’s hard to match, especially for employees and their families.
Employee Highlights:
- $0 Copays on all covered services
- 24/7 Virtual Care & Telemedicine
- Mental Health & Counseling
- Addiction & Recovery Support
- Group Term Life Insurance ($60–$100/month)
- 12 Annual Care Visits for Families
- Dental, Vision, and RX Coverage, all with $0 copays
- Spouse & Dependent Coverage Included
Employees get all of this with no reduction in take-home pay. That means they’re better supported at home and at work, without sacrificing their paycheck.
What Makes BrightPath Advantage Different?
Let’s compare the traditional cafeteria plan to BrightPath’s enhanced solution:
| Feature | Traditional 125 Plan | BrightPath Advantage |
| Pre-Tax Premium Deductions | Yes | Yes |
| Flexible Spending Account Option | Yes | Yes |
| $0 Copay Family Care | No | Yes |
| Life, Disability, and Critical Illness | No | Yes |
| 24/7 Mental Health & EAP | No | Yes |
| Spouse & Dependent Coverage | No | Yes |
| Employer Cost | Varies | $0 |
| Annual Employer Savings per W-2 | ~$600 | $1,100 |
Compliance, Simplified
To stay compliant with IRS Section 125 rules, employers must:
- Maintain a written plan document
- Offer the plan only to eligible employees (W-2, not 1099)
- Avoid discrimination toward highly compensated individuals
- Limit mid-year changes to qualifying life events
With BrightPath Advantage, we handle all of this for you. Our plan is built to be fully IRS-compliant, fully automated, and entirely hands-off for HR.
Is the BrightPath Advantage Right for Your Company?
If you’re an employer with 5 or more W-2 employees, looking for a cost-free way to deliver premium employee benefits cafeteria plan, BrightPath Advantage could be your best move.
Thousands of companies are already experiencing:
- Reduced overhead
- Happier, healthier employees
- Stronger performance and loyalty
With over 30,000 employees already enrolled, it’s clear: BrightPath Advantage is more than just a Section 125 plan, it’s a complete benefits strategy.
A Smarter, Healthier Future Starts with BrightPath Advantage
Get your free proposal to find out how your business can save more while giving employees the care they deserve.