Health Insurance Center
Health Insurance Q & As
Question 7 of 13 in Employer-sponsored Group Policies
Can you help me understand the cafeteria plan my employer offers?
A Cafeteria Plan gives the employee a range of options about the types and levels of benefits, as opposed to having these decided by the employer and the insurer. Under a cafeteria plan, the employee may choose among 2 or more benefits consisting of cash and qualified benefits (such as health insurance, optical plan, dental plan, short-term disability coverage, life insurance, or additional sick days or vacation time). The employee decides which benefits fit his/her needs and utilizes the benefits selected.