If you’re a business owner reading this, you’ve probably had this exact thought: Wait — my employees get an extra $1,200 a year in their paychecks, I save $573.60 per employee in payroll taxes, no one pays anything out of pocket, and the IRS is okay with this?
That can’t be right.
I had the same reaction the first time I heard about the CHAMP Plan. So before I tell you how it works, let me tell you what changed my mind.
I Was Skeptical Too
When my business partner Jeff Klie of Omni Solutions first walked me through the CHAMP Plan, my honest gut reaction was that it sounded too good to be true. I’d spent over a decade in sales — twelve years in wireless with Verizon and Metro PCS — and I’d seen enough programs marketed as “free money” to know better.
But I trusted Jeff. So I sat through the presentation with an open mind.
The moment it clicked for me was when he pulled up an actual employee paycheck stub and walked me through the math line by line. I could see exactly where the deduction came out, where the credit went back in, and where the FICA tax savings hit on both sides. It wasn’t theory. It was right there on the paystub.
The second piece that convinced me was finding out the program partners with Mayo Clinic. When you tell me Mayo Clinic helped build the medical framework that makes this thing IRS-compliant, that gets my attention. We’ll come back to that.
How the Money Actually Moves
This is the part most explanations get wrong because they make it too complicated. Here’s the simplest way I know how to put it.
A participating employee has $1,200 a year deducted from their gross pay on a pre-tax basis. That $1,200 funds the program.
Here’s what happens next:
- Because the deduction is pre-tax, the employee’s taxable income drops by $1,200.
- The employer’s matching FICA tax on that $1,200 of wages drops too — by $573.60 per year per participating employee. That’s money the employer keeps.
- The employee then receives a $1,130 credit back from the program that is not taxed as income.
The difference between the $1,200 deduction and the $1,130 credit is only $70 — but because the employee is no longer paying FICA, federal income tax, or state tax on that $1,200 of wages, their actual net take-home pay goes up by about $100 a month.
So, at the end of the year, the employee has roughly $1,200 more in their pocket. The employer has $573.60 more per employee in their pocket. And nobody wrote anybody a check to make that happen.
This isn’t magic. It’s the IRS code working the way it was designed to.
But Wait — Is This Even Legal?
This is where most business owners get nervous. And it’s the right question to ask.
The short answer is yes, and it’s been legal since the 1960s.
The CHAMP Plan is structured as a Section 125 Cafeteria Plan under the Internal Revenue Code. Section 125 plans have been a sanctioned IRS benefit structure for over sixty years. If you’ve ever had a Flexible Spending Account, Dependent Care FSA, or a pre-tax health insurance premium deduction, you’ve used a Section 125 plan. This is the same legal framework — just applied differently.
What makes the CHAMP Plan unique is how it generates the qualifying medical events that justify the pre-tax treatment. That’s where Mayo Clinic comes in.
Where the CPT Codes Come In
CPT codes are the standardized billing codes that medical providers use for every procedure, screening, and patient interaction in the U.S. healthcare system. They’re the same codes your doctor’s office uses when they bill your insurance.
When an employee enrolls in the CHAMP Plan, they fill out a medical intake form similar to the one you’d fill out at a new doctor’s office. The platform then customizes a monthly stream of articles and information tailored to the employee’s health profile. If someone is trying to quit smoking, they might get an article on managing stress without cigarettes. If someone has elevated blood pressure, they get content focused on lifestyle interventions for cardiovascular health.
Reading those articles each month is what triggers the CPT code. The platform also has a face scanner that can flag potential medical concerns — high blood pressure is a common one — and route the employee to a follow-up resource.
This is the part that makes the whole structure work. The articles aren’t just content. They’re a documented preventive health intervention, tied to a real billable CPT code, with a corresponding Explanation of Benefits. Mayo Clinic’s involvement is what gives that documentation the clinical weight it needs to satisfy IRS scrutiny.
Companies Already Using It
If you’re still skeptical, look at who else is using it.
Piggly Wiggly rolled the CHAMP Plan out across 85 of their locations. Dunkin’ Donuts uses it. So do Burger King and Harley-Davidson. These aren’t fly-by-night operations. They have legal teams, CFOs, and benefits consultants who would never let them touch a program that wasn’t airtight.
When I see Curt Schmidt, the franchise owner of Piggly Wiggly, on camera saying the CHAMP Plan is the single greatest benefit they’ve ever implemented for their employees and their bottom line, that tells me everything I need to know about whether this is legitimate.
“But My Employees Won’t Care About This”
This is the objection I hear the most after a business owner understands how it works.
It usually sounds like this: “Paul, my employees are young. They think they’re invincible. They don’t care about health benefits. How am I going to get them to participate?”
It’s a fair concern. And it’s the question with the most surprising answer.
When we begin a CHAMP Plan engagement, the first thing we ask for is a payroll census. We don’t need Social Security numbers, or any personal information — just a snapshot of each employee’s paycheck data. From that, we produce a personalized report that shows each employee exactly how much their paycheck will increase if they enroll.
When an employee sees the actual dollar amount of their own take-home pay increase, written down with their own paycheck math, the conversation changes. They’re not enrolling in a health benefit. They’re enrolling in a raise.
That’s why our participation rates run at 90%. It’s not because employees suddenly got excited about health benefits. It’s because they got to see, in black and white, what enrolling does to their paycheck.
Why I Do This Work
I’ll be genuine about why I sell this program.
I want people to be healthier and live longer lives. Period.
I want employees — especially the hourly and frontline workers who too often get overlooked on benefits — to be able to actually use the things that keep a person healthy. With the CHAMP Plan, that means zero co-pay primary care visits. It means free prescription drugs. Free virtual care. Free virtual mental health care. Free urgent care. Even free virtual pet health care, because for a lot of working families, the dog is a family member.
I get to walk into a business or a nonprofit and hand the owner a tool that does four things at once. It increases employee retention. It improves their team’s health. It puts more money in the company’s pocket. And it puts more money in every employee’s paycheck.
I don’t know of another program in the country that does all four of those things at the same time, at zero net cost.
That’s why I do this. And that’s why, when somebody tells me the CHAMP Plan sounds too good to be true, I just smile and say — I thought the same thing. Then we get on a Zoom call with Jeff Klie and we show them how the money moves on a paycheck stub.
Curious About Your Numbers?
If you’ve read this far, you’re not the type to dismiss this without looking at it. So here’s my suggestion.
Send me your payroll census. Contact me and I will be specific on what we need exactly. No personal information, no Social Security numbers, no commitments. Just the data we need to show you exactly what the CHAMP Plan would do for your business and for each of your employees.
I’ll run the numbers, we walk you through them on a 20-minute Zoom, and you can decide for yourself whether it sounds too good to be true.
Most of the time, it just sounds true.