Defined contribution is one of the easiest ways to control budget and create a predictable employer spend across multiple plan options.
Instead of setting contributions as a percentage of premium, you set a fixed employer amount (per tier), and the employee simply pays the difference between the premium and the employer contribution.
In Plansight, defined contribution is done directly in the Modeler, and it can be set independently for each option. That means you can apply one defined contribution strategy to Option 1, and a completely different one to Option 2, while still keeping your current plan intact for comparison.
Once contributions are applied, PlanSight automatically calculates:
- The employer contribution by tier
- The employee cost by tier
- The impact across each plan option
Those results are then reflected everywhere they matter, including the presentation output.
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Questions this article answers • How do I set up defined contribution in Plansight? • What is defined contribution and how does it work? • How do I set a flat dollar amount per tier for employer contributions? • How does the employee cost get calculated with defined contribution? • Can I apply different defined contribution amounts to different plan options? • Where do I switch from percentage to defined contribution in the Modeler? • How does defined contribution create a predictable employer spend? • Does defined contribution work with dual option plans? • How do I control the employer's budget across multiple plan options? • Where do defined contribution results show up in the presentation? • Can I keep the current plan on percentage while alternatives use defined contribution? • How does the employee just pay the difference with defined contribution? • How do I compare defined contribution vs percentage-based scenarios? • What tiers can I set defined contribution amounts for?