Private Health Services Plan (PHSP) in Canada

What is a Private Health Services Plan (PHSP)

Also common referred to as a Cost Plus plan or a Health and Welfare Trust, the proper name for such a tax deductible plan set up is a Private Health Services Plan, or PHSP. A PHSP is designed to reimburse expenses that are not covered by a group insurance plan or by government healthcare and also when there is no group health and dental care plan offered through your business or employer.

The Federal Income Tax Act allows for eligible medical expenses that are reimbursed through the Private Health Services Plan to be a tax deductible expense to the business and a non-taxable benefit to employees.

How Do I Qualify for a Private Health Services Plan (PHSP)?

You must have an incorporated business or a limited company to qualify. It doesn’t matter the size of your company to be eligible. You could just be one person, owner/operator of the business, or have 50 or more people working for you. You can read the CRA discussion of Private Health Services Plans in IT Bulletin 519R2.

Beneco – Life Guard Insurance’s PHSP Plan Administrator

Life Guard Insurance has partnered with Beneco in Canada to offer Private Health Services Plans to its clients who can benefit from it. Here is how it works:

There is an initial set up fee of $350 to establish the private health services plan, payable in advance. An annual maintenance fee of $100 will be implemented on the yearly anniversary of the private health services plan. The fee for administering the Cost Plus PHSP is based on 10% of the claim amount, plus applicable taxes (minimum claim amount is $150, so save up minor expenses). Beneco will provide full disclosure of your accounts for future audit control and employee/employer information.

In effect you pay for all your own medical expenses through your PHSP, plus the 10% Cost Plus or PHSP administration fee. Then, 100% of all the expenses are tax deductible to the business and the expense reimbursements are a non-taxable benefit to the employees.

Here is a summary of the advantages to setting up a Beneco Plan

FOR THE COMPANY	FOR THE OWNER
100% Tax Deductible	100% Coverage for all Healthcare and Dental costs
No Monthly Premiums	Tax Free Benefits
Employer can decide level of coverage, options and class structure	Can amend plan based on owner’s discretion
Fast Claims Processing along with Flexibility	Can supplement existing group coverage

The Beneco Service Guarantee

Life Guard Insurance has chosen to work with Beneco because their experience and level of service is closely aligned with our own. Here is what Paul Hauk, the founder of Beneco, has to say about their level of service:

“What sets us apart? Instead of hounding existing clients or future prospects to purchase a Health Spending Account, we spend our time building relationships, making friends, and providing the absolute highest quality of service available. That’s why most of our business comes from referrals and recommendations.

The Beneco Plan is a flexible tax effective health spending account used to either top up on your group benefits plan or be an alternative to setting up a group benefits plan altogether.

Our services include claims adjudication, claims tracking, 5 day turn around on accurately submitted claims, administrative support.

Integrity - Experience - Knowledge - Customer Service

These are the qualities that are key to our day to day organization. Together these characteristics form the basis of our core values and have seen us through more than 50 years of combined experience serving our clients.”

Paul Hauk