1. Managed care plan offered by an employer to his or her employees that allows them to select the type and amount of benefits from a “menu” of different options the employer offers such as health care, life insurance, vacation, and disability insurance. Some cafeteria plans give an employee a certain number of benefit “points,” which can be used to purchase one or all of the benefits offered by the company. An employee who did not want to participate in a health plan could apply more points toward a 401(k) plan, life insurance, or any other benefit offered. Under some plans, the credits can be redeemed for cash. The employer pays for the plan with before-tax dollars. Also called flexible benefit plan, flex plan, or flexible compensation. 2. See Section 125 of the Internal Revenue Code.