Business Tax Strategy · ProfitGuard Plus
SIMRP, FICA savings plan,
wellness plan: the same thing?
Mostly, yes. A SIMRP, a FICA savings plan, a Section 125 wellness plan and a preventative care management plan all describe the same structure from different angles. The names come from different parts of it. What matters is not the label somebody uses. It is how the plan is built underneath.
Quick answer
- SIMRP, FICA savings plan, wellness plan and preventative care management plan are used interchangeably for the same kind of arrangement.
- SIMRP is the reimbursement piece: a Self-Insured Medical Reimbursement Plan under Section 105 and Treasury Regulation 1.105-11.
- FICA savings plan describes the result for the employer: a lower payroll tax bill.
- Wellness plan or preventative care management plan describes what the employee actually receives: telehealth, mental health support, care navigation, chronic condition support.
- Section 125 cafeteria plan is the pre-tax election that funds it.
- ProfitGuard Plus is our name for the whole structure with all of those pieces assembled.
- The label tells you nothing about whether a plan holds up. The construction does.
Why there are four names for one thing
Each name comes from a different part of the same arrangement. The employee makes a pre-tax election through a Section 125 cafeteria plan. That funds a preventative care program, which is the wellness half. Qualified medical care is then reimbursed through a Self-Insured Medical Reimbursement Plan, which is the SIMRP half. Because the pre-tax election lowers the wages payroll tax is figured on, the employer's FICA bill drops, which is where FICA savings plan comes from.
Same structure, four vantage points. A payroll company might call it a FICA savings plan. A benefits broker might call it a wellness plan. A CPA might ask about the SIMRP. They are usually talking about the same thing.
What each term actually refers to
SIMRP
The Self-Insured Medical Reimbursement Plan. The written plan, under Section 105 and Treasury Regulation 1.105-11, that reimburses employees for qualified medical care without it counting as income.
FICA savings plan
The employer's view. Because the pre-tax election lowers the wages FICA is calculated on, the employer's share of payroll tax goes down, about 500 to 600 dollars per employee a year.
Wellness or preventative care management plan
The employee's view. The care they actually receive: telehealth for the family, mental health support, health screenings, care navigation and chronic condition coaching.
Section 125 cafeteria plan
The pre-tax election itself. It is the umbrella the rest sits under, and it is the same kind of document behind your group health insurance.
So what should you actually ask about
Not the name. Ask how it is built. Does an employee have to complete an activity each month to keep the benefit? What is the reimbursement paid out of, and is it taxable to the employee? Can you and your CPA read the plan documents? Those three answers tell you more than any label ever will.
We wrote the long version of that as a checklist you can run against whatever you are in right now: is a Section 125 preventive care plan legal. The mechanics are on the SIMRP page.
Frequently asked questions
Is a SIMRP the same as a FICA savings plan?
In ordinary use, yes. SIMRP names the reimbursement piece and FICA savings names the result for the employer. Both usually describe the same arrangement: a Section 125 pre-tax election funding a preventative care program, with reimbursement flowing through a Self-Insured Medical Reimbursement Plan.
Is a wellness plan the same as a preventative care management plan?
Generally yes. Both describe the care the employee receives inside this kind of plan. The important question is not the name but whether the benefits qualify as medical care under Section 213(d).
What is ProfitGuard Plus then?
It is our name for the whole structure assembled: the Section 125 election, the preventative care program, the SIMRP reimbursement, paired with a qualifying ACA medical plan so it is an integrated Section 105 plan.
Does the name tell me whether a plan is compliant?
No. Two plans can carry the same name and be built completely differently. What matters is whether benefits are medical care under Section 213(d), whether reimbursement runs through the SIMRP rather than back through the cafeteria plan, and whether you can read the plan documents.
Which term should I use with my CPA?
Any of them, then hand over the plan documents. A CPA will look at the code sections and the reimbursement structure, not the marketing name.
This is education, not tax or legal advice. Actual savings vary by payroll structure, participation, and state and local tax. Talk to your CPA about your specifics before you decide. ProfitGuard Plus is a marketing name for a structure built on IRS code sections 125, 106(a), 105, and 213(d).
See your ProfitGuard Plus number
Enter your W-2 headcount and see the combined value first. Then we'll run your exact numbers. You can also read the full walkthrough on the ProfitGuard Plus page or call +1 (586) 899-1003.
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