Health Insurance payments with payroll liability checks

This is the way my company handled it:
We changed the payroll item for the employee deduction so that rather than crediting the "Payroll Liability" account, we credited a "Health Insurance expense" account.
Then when we received the insurance bill, we juat paid it like a regular vendor, at which time we debited the "Health Insurance expense" account. What was left as the balance in the expense account was the company's net cost of providing the insurance.

Your other option is to leave things as they are now, but when you go to pay the liability from the Payroll Liabilities, when you view the check, charge the difference to your "Health insurance expense" account by clicking on the "expenses" tab in the view window. Click the recalculate button, and the check amount should now be the same as your insurance bill. This will then clear out the liability, and record the difference to your expense accoun (depending on the timing the entry to the expense account could be a debit or a credit).

Either way the end result is the same.

I hope this helps. Let us know.

Thank you! That was very helpful, and very fast response time. I really appreciate it.