What is the difference between Deduction Adjustments and Reimbursements?
When an over-deduction occurs, it can be resolved using either a Deduction Adjustment or a one-time Reimbursement, depending on the situation. An example of each type of resolution is seen below:
Cases that can be resolved by a deduction plan
When someone is over-deducted for benefits and has more than a $0 deduction moving forward, we can balance out their year-to-date deductions by calculating an adjustment plan.
- For example, Bob pays $50 for medical benefits on every paycheck. On 6/1, he attempts to add a dependent to his medical insurance, increasing his deduction to $75. However, on 7 /16 the carrier rejects the addition of that dependent, resulting in a $50 over-deduction. This over-deduction would appear on the Deductions Adjustment dashboard, because we can adjust the deductions to $0 for one pay period to balance everything out.
- In this scenario, Bob's two $75 deductions were made on 6 /15and 6/30. As a result, we adjust his deductions to $0 on 7 /15, and then restore them to $50 on 7 /31. Bob's deductions are now balanced.
Cases which require reimbursement
In instances where someone is over-deducted for benefits and has a $0 deduction amount moving forward, we cannot balance out their year-to-date deductions with an adjustment plan. They will instead receive a one-time reimbursement.
- For example, Sally attempts to enroll in medical insurance with an effective date of 6/1 and a per-paycheck deduction of $75, which is approved by the carrier. However, on 7/1, she decides to remain on her spouse's insurance instead, and requests a cancellation as of 6/1. Since Sally had two paycheck deductions of $75 made, this over-deduction would appear on the Reimbursements Dashboard, as a reminder to reimburse.
- In this scenario, Sally received two deductions of $75 on 6 /15 and 6/30. Since she has requested a cancellation, we issue a one-time reimbursement of $150 on the next paycheck date of 7 /15 for the two deductions.
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