Apparatus and method of composing a plan of flexible benefits

• US 6,092,047 A
• Filed: 10/07/1997
• Issued: 07/18/2000
• Est. Priority Date: 10/07/1997
• Status: Expired due to Fees

• Current Assignee: Kenneth Ketover
• Original Assignee: Benefits Technologies LLC
• Inventors: Hyman, Andrew A., Jaeger, William R.
• Primary Examiner(s): Cosimano, Edward R.
• Assistant Examiner(s): Alvarez, Raquel
• Application Number:
  US08/946,269
• Time in Patent Office: 1,015 Days
• Field of Search: 705/1, 705/4, 705/7, 705/35, 705/36
• US Class Current: 705/36.00R
• CPC Class Codes: G06Q 10/1057 Benefits or employee welfare, e.g. insurance, holiday or retirement packages
• CPC Class Codes: G06Q 40/00 Finance; Insurance; Tax strategies; Processing of corporate or income taxes
• CPC Class Codes: G06Q 40/02 Banking, e.g. interest calculation or account maintenance credit or loans G06Q40/03
• CPC Class Codes: G06Q 40/06 Asset management; Financial planning or analysis

Abstract

There is disclosed a method and apparatus for devising the financial aspects of a plan of benefits for a given population of employees in accordance with goals set by an employer of the employees. This invention enters data into a memory of a computer system reflective of the employees, the costs of the benefits and the employer'"'"'s goals. Next, variables are defined and entered into the memory reflecting the costs of the benefits, and a set of relationships is constructed of the cost variables in a manner to constrain the cost variables in accordance with the plan of benefits. Finally, the set of relationships is processed in the computer system to provide at least one set of solutions of the cost variables.

Claims

1. A method of devising the financial aspects of a plan of benefits for a population of employees in accordance with a plurality of goals of an employer of the employees, each of the benefits having a cost, said method comprising the steps of:

a) entering data concerning the population of employees and a rate for each of the benefits into a memory of a computer system;

b) defining a first set of cost variables reflecting respectively a contribution made by the employer to the costs of the benefits, an employee cost of the benefits provided to each employee and, to the extent that the employer'"'"'s contribution is insufficient to pay for the employee benefits, an employee contribution made by each employee to the cost of his/her employee benefits, and entering the defined variables into the memory of the computer system;

c) defining a second set of goal variables selected from said first set of variables reflecting the goals of the employer for the plan of benefits and entering the second set of variables into the memory of the computer system;

d) structuring the first and second sets of variables into a set of relationships; and

c) processing the set of relationships to determine the amounts of these cost variables.

2. A method of devising the financial aspects of a plan of benefits for employees in accordance with a plurality of goals and a plurality of priorities set by an employer of the employees, said method comprising the steps of:

a) receiving and entering data concerning a current population of the employer'"'"'s employees and a current charge rate for each benefit of the plan into a memory of a computer system;

b) classifying the current population of the employees into respective ones of a plurality of classes;

c) setting variables reflecting a set of costs of the benefits for each of the classes of employees and the goals of the plan;

d) constructing the cost and the goal variables into a set of relationships; and

e) solving the set of relationships to provide solutions of the cost and goal variables for each of the classes.

3. A method of devising the financial aspects of a new plan of benefits in accordance with a set of goals of an employer and comparing the financial aspects of the new plan with a present plan of benefits for a common population of employees and comparable benefits, said method comprising the steps of:

a) entering data into a memory of a computer system reflecting a common population of employees, the benefits of the present plan and a pool of benefits from which at least some of the benefits of the new plan may be selected and a set of costs for each of the benefits of the present plan and of the pool;

b) entering data into the memory reflective of the benefits selected from the benefit pool by each employee of the common population;

c) defining variables reflecting the costs of the benefits of the present plan and the selected benefits of the new plan;

d) selecting and structuring a first set of variables from the cost variables defined in step c) into a set of relationships;

e) selecting from the first set of variables a second set of variables and structuring the second set of variables to reflecting the employer'"'"'s goals into an objective relationship; and

f) processing the set of relationships of the first set of variables and the objective relationship of the second set of variables to provide an optimum solution of the cost variables.

4. The method of devising and comparing the financial aspects of the present and new plans of benefits as claimed in claim 3, wherein the cost variables defined in step c) include at least one variable reflective of that relationship between the costs of the new and present plans as set by the employer.

5. The method of devising and comparing the present and new plans of benefits as claimed in claim 4, wherein step f) solves the set of relationships of the first set of variables and the objective relationship of the second set of variables to provide an optimum solution of said cost relationship variable.

6. A method of devising the financial aspects of a plan of benefits for a given population of employees in accordance with goals set by an employer of the employees, said method comprising the steps of:

a) entering data into a memory of a computer system reflective of the employees, a set of costs of the benefits and the employer'"'"'s goals;

b) defining and entering variables into the memory reflecting the costs of the benefits;

c) constructing a set of relationships of the costs in a manner to constrain the cost variables in accordance with the plan of benefits; and

d) processing the set of relationships in the computer system to provide at least one solution of the cost variables.

7. The method of devising the financial aspects of a benefit plan as claimed in claim 6, wherein step b) defines a target variable defining as a target amount of a cost of a particular benefit.

9. The method of devising the financial aspects of a benefit plan as claimed in claim 6, wherein step c) constructs one of the set of relationships to reflect a total cost of the benefits of the plan as the sum of the costs of each benefit of the plan.

10. The method of devising the financial aspects of a benefit plan as claimed in claim 6, wherein step c) constructs one of the set of relationships to reflect a total cost of the benefits to each employee as the sum of a contribution made by the employer to such employee for his/her benefits and a contribution made by the employee for his/her benefits.

8. The method of devising the financial aspects of a benefit plan as claimed in claim 8, wherein step b) defines the target variable as the difference between the target amount and an actual amount of the particular benefit cost, and step d) solves said set of relationships to provide a solution of said target variable.

11. Data processing apparatus for devising in accordance with a set of goals ranked in accordance with a set of priorities determined by an employer the financial aspects of a plan of benefits for a given population of the employer'"'"'s employees, said apparatus comprising:

a) a memory for storing a variables solving program;

b) means for inputting into said memory data reflecting the employees, variables indicative of a set of costs of the benefits, variables defining the goals to be set by the plan, a set of relationships including a first set of selected variables to constrain the cost variables and an objective relationship including a second set of variables selected from the first set of variables in accordance with the goals;

c) means for executing the variables solving program to obtain a sequence of sets of optimum solutions as to an amount of the cost variables, each set of optimum solutions reflecting a different one of the set of priorities;

d) means for displaying the optimum solutions of the cost variables to the employer; and

e) means responsive to the employer'"'"'s input for repetitively altering the set of priorities as stored in said memory, whereby each set of optimum solutions reflects its priority.

12. A method of devising the financial aspects of a plan of benefits for a given population of employees in accordance with a set of goals ranked by an employer of the employees, each benefit has a cost, said method comprising the steps of:

a) defining variables reflecting respectively the costs of the benefits;

b) structuring a set of relationships employing a first set of cost variables;

c) structuring an objective relationship to include a second set of variables selected from the first set of variables dependent on the set of goals of the employer;

d) entering and assigning priorities set by the employer in a ranked order to selected of the second set of variables; and

e) processing the set of relationships and the objective relationship to provide at least one optimum solution of the cost variables in accordance with the ranked goals.

13. The method of devising the financial aspects of a benefit plan as claimed in claim 12, wherein there is farther included a step of displaying the optimum solution of the cost variables for review by the employer.

14. The method of devising the financial aspects of a benefit plan as claimed in claim 12, wherein the set of relationships structured by step b) includes a set of linear equations.

15. The method of devising the financial aspects of a benefit plan as claimed in claim 14, wherein said objective relationship structured in step c) is an objective row.

16. The method of devising the financial aspects of a benefit plan as claimed in claim 15, wherein step d) assigns priorities by inserting a plurality of coefficients into the objective row, each coefficient being related to a corresponding objective variable and its amount set in accordance with the set of ranked goals of the employer.

17. A method of devising the financial aspects of a first plan of benefits and comparing the financial aspects of the first plan with the financial aspects of a second plan, each benefit having a cost, said method comprising the steps of:

a) defining variables reflecting the costs of the benefits included within the first and second plans, at least one of the variables defining a cost relationship between the first and second plans as set by the employer;

b) structuring a set of relationships employing selected of the cost variables; and

c) processing the set of relationships to provide solutions of the cost variables and of the cost relationship variable.

18. A method of devising the financial aspects of a plan of benefits selected by each of a population of employees from a pool of benefits provided by an employer of the employees, said method comprising:

a) entering data into a memory of a computer system reflecting a status of the employees, the benefits of the pool, a charge rate of the benefits and a monetary contribution made by the employer to selected of the benefits of the pool;

b) inputting and entering data into the memory reflective of the benefits selected by each employee from the pool;

c) defining variables reflecting the costs of the benefits of the pool and the monetary contribution made by the employer, and a set of objectives for the new plan as selected by the employer;

d) structuring a set of relations employing the cost and objective variables; and

e) processing the set of relationships to provide solutions of the cost variables.

19. A method of devising the financial aspects of a plan of benefits for a population of employees, each benefit having a cost, said method comprising the steps of:

a) entering data reflecting the population of employees, a charge rate for each benefit and a contribution made by an employer of the employees to each employee of the population, and a total of the costs of the benefits for each employee of the population being charged to the employer'"'"'s contribution to that employee;

b) defining a first set of variables reflecting the employer'"'"'s contribution to each of the employees and a contribution from each employee as to any insufficiency between the costs of the benefits to that employee and the employer'"'"'s contribution to that employee;

c) defining a second set of variables reflecting the objectives of the employer for the plan of benefits;

d) structuring the first set of variables into a set of relationships; and

e) processing the set of relationships to determine respectively the employer'"'"'s and employee'"'"'s contributions.

20. The method of devising the financial aspects of a plan of benefits as claimed in claim 19, wherein there is included a pool of benefits from which each employee may select at least some of the benefits in the employee'"'"'s plan, step a) further includes entering the charge rate for each benefit in the pool and there is further included the step of inputting and entering into a memory data reflective of the benefits selected by each of the employees from the pool.

21. Data processing apparatus for devising in accordance with a set of goals of an employer for the financial aspects of a plan of benefits for a population of the employer'"'"'s employees, said apparatus comprising:

a) a memory that stores executable linear programming software and variables;

b) a data inputer that inputs data into said memory reflecting a status of each of the employees, the variables being indicative of the costs of the benefits and of the goals of the employer for its plan of benefits, a set of linear equations including a first set of selected ones of the variables to constrain the cost variables and an objective row including a second set of the variables selected from the first set of variables in accordance with the set of goals, and

c) a control processing unit that calls and executes the linear programming software to solve the linear equations and, thus, to obtain an optimum set of solutions of the cost variables.

22. Data processing apparatus as claimed in claim 21, wherein there is further include a display that presents said set of solutions to the employer.

23. Data processing apparatus as claimed in claim 21, wherein the employer has a set of priorities for ranking the set of goals, said data inputer inputs the set of priorities into said memory, said control processing unit executes the linear programming software to provide and enter a set of coefficients into the objective row, whereby each coefficient is associated with a corresponding one of the variables of the second set to impart a given priority to its associated variable.

24. Data processing apparatus as claimed in claim 21, wherein the programming software is linear programming software.

25. A method of devising the financial aspects of a plan of benefits for employees in accordance with a plurality of goals and a plurality of priorities set by an employer of the employees, said method comprising the steps of:

a) receiving and entering data concerning the status of a current population of the employer'"'"'s employees and a current charge rate for each benefit of the plan into a memory of a computer system;

b) classifying a current population of employees into respective ones of a plurality of classes;

c) setting variables reflecting a set of costs of the benefits for each of the classes of employees, the goals of the plan and a variable reflective of a goal of the employer to reduce the difference between the set of costs of the benefits to one of the plurality of classes of employees and the set of costs of the benefits to another of the plurality of classes of employees;

d) constructing the cost and the goal variables into a set of relationships; and

e) solving the set of relationships to provide solutions of the cost and goal variables for each of the classes.

26. A method of devising the financial aspects of a plan of benefits for a population of employees, wherein there is included a pool of benefits from which each employee may select at least some of the benefits in an employee'"'"'s plan and an employer'"'"'s contribution includes a monetary incentive related to selected of the benefits included within the pool, said method comprising the steps of:

a) entering data reflecting the population of employees, a charge rate for each of the benefits and the employer'"'"'s contribution to each employee of the population, the cost of the benefits for each employee of the population being charged to employer'"'"'s contribution to that employee and a charge rate for each benefit in the pool;

b) defining cost variables reflecting the employer'"'"'s contribution to each of the employees and a contribution from each employee as to any insufficiency between the costs of the benefits to that employee and the employer'"'"'s contribution to that employee;

c) defining a set of objective variables reflecting a set of objectives of the employer for the plan of benefits and the monetary incentive;

d) structuring the cost variables reflecting the employer'"'"'s and employee'"'"'s contributions and the objective variables into a set of relationships;

e) processing the set of relationships to determine respectively the amounts of the employer'"'"'s and employee'"'"'s contributions; and

f) inputting and entering into a memory data reflective of certain benefit selections made from the pool by each of the employees.

27. The method of devising the financial aspects of a plan of benefits as claimed in claim 26, wherein at least one of the benefits of the pool includes a plurality of levels of coverage, and the employer'"'"'s contribution includes a like plurality of monetary incentives corresponding respectively to the levels of coverage, step c) further defines a like plurality of variables reflective of the plurality of coverage levels, and step a) enters into the memory data reflective of the employee'"'"'s selection of a coverage level.