Introduction
Ever scrolled through your pay stub and wondered, “What exactly does health plan value mean?” This 2025 guide simplifies how health contributions—both from you and your employer—appear on pay stubs, how they affect your taxable income, and how to interpret related codes and figures clearly.
What Is Health Plan Value on a Pay Stub?
The "health plan value" typically refers to contributions toward your health insurance—either made by you (employee) or your employer. It reflects financial investment toward your medical coverage and benefit plans, not the actual cost of your healthcare services.
Employee vs. Employer Health Contributions
- EE Health/EE Premium: The amount deducted from your paycheck, often taken out before taxes (pre-tax).
- ER Health/ER Health Cov: The portion your employer pays toward your health insurance—typically noted for transparency, not as a deduction.
Both figures make up the total health plan value visible on your pay stub.
Why Pre-Tax Deductions Matter
Many health-related contributions are handled under a Section 125 cafeteria plan. This setup deducts benefit costs like health insurance or HSAs before taxes are calculated, reducing your taxable income. That means a $100 deduction lowers the income subject to federal, Social Security, and Medicare taxes—potentially saving you money.
Example: Reading Health Plan Value
Here’s how these contributions might appear on a pay stub:
- EE Health: $80 (pre-tax deduction)
- ER Health: $230 (employer’s contribution)
- Health Plan Value Total: $310
While you only have $80 deducted from your pay, the full $310 represents the total benefits applied to your coverage.
How to Interpret the Numbers
- Pre-tax deductions reduce your taxable income immediately.
- Employer contributions, while not taxable income for you, are part of your compensation and help clarify the full cost of benefits.
- This transparency helps with budgeting, tax filing, and verifying employer benefits.
Suggested Breakdown on Your Stub
- Gross wages (before any deductions)
- Pre-tax deductions (health premiums, HSA, etc.)
- Taxable wages
- Employer health value
- Net pay
- Year-to-date totals
This comprehensive layout ensures clarity and helps during audits or benefit reconciliation.
Why It Matters to You
- Helps you understand how much your employer is investing in your health benefits.
- Shows the real impact of deductions on your take-home pay.
- Aids in making informed decisions during open enrollment or tax time.
Generate Clear Pay Stub Examples Instantly
If your official stub lacks clarity, you can generate a pay stub with detailed health plan breakdowns—professional and clear. It helps when submitting documents for financial or medical verifications.
Generate pay stubs with complete health contribution details or see layout examples in our Regular Pay Stub guide.
Conclusion
Understanding the health plan value on your pay stub reveals the full scope of your healthcare benefits. Employee and employer contributions together reflect your total health investment. Keeping an eye on those numbers helps you plan financially and gain clarity. For clear pay stubs with detailed health breakdowns, try our generator above—you’ll always have professional documentation ready.
