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Expert Answers to Biz Questions
Listen in! Pick up some expert advice to a reader's question that we selected from CyberSchmooz.
How to Get Your Employees Health Benefits Without Breaking the Bank
No matter what size your business is, offering health benefits is something you want to do for your employees. Now with various laws in place, you might not be sure how you need to proceed with your health insurance options. You want to make sure that you are offering your employees enough coverage, but you don’t want to go over your budget.
There are things that you can do to make sure that you are getting the best price on your health benefits for your employees, but first you need to know what you want so you can go about getting it.
What Benefits Will You Offer Your Employees?
It is a big decision to make when you are trying to figure out what health services will be covered and how much money you are willing to spend on your employees’ health. While you do not want to be cheap, you also do not want to go over budget since that will hurt the company.
What you are going to find is that most plans only differ in the levels of reimbursement that is offered and not in the type of care that is covered. For instance one plan will cover the same procedure but only 70% after a $500 deductible vs 80% with a $500 deductible. You also have to look at in network providers and out of network providers.
With the health care reform there is heavy regulation on the insurance industry so make sure that you full understand everything that is necessary. If you are working with a knowledgeable broker, you shouldn’t have to figure out too much on your own, but it can still be a hassle.
Getting Better Prices on Coverage
If you are a SMB (Small to Medium Size Business) you are able to get the same discounted prices as big business. Or can you? Now if you use PEO companies, in many cases you will be able to get the big discounts that large companies can get because these PEO companies have a lot of business they bring and they won’t come to work with a provider without a nice discount.
What is a PEO? A professional employer organization that helps you be a better boss in terms of admin, hr, and legal compliance. If you haven’t considered using a PEO company for your business, this might be something that you want to look into. You can look into different levels of service when you are working with these companies. Some businesses choose to allow them to take over their whole HR division so that they have little to no in-house HR.
The lower price on health care coverage isn’t the only reason that you would want to work with a PEO. These companies make it their business to know all of the rules and regulations from payroll to insurance and everything in between.
How Much Will a PEO Company Cost?
Depending on the size of your company, there is a large range of prices to look at for having a PEO company and you shouldn’t jump into it before you are ready.
You only need a PEO "when administrative processes begin slowing down the productivity of the firm," says Dan Sheridan, president and chief operating officer of Extensis, a PEO.
If that sounds like you then you should know that the cost could be $500 to $1,500 per employee or for smaller business with only 5 or less employees, you may be looking at a flat $150 or so fee per month.
Make sure that you weigh the pros and cons of having a PEO and taking care of everything yourself. Some people find that they are paying more for their insurance and in-house HR than if they were to hire a PEO company.
How Do I Know If a PEO is Right For Me?
Before you hire a PEO company, make sure that you do your due diligence. Speak to other business professionals to see what their experience with a specific PEO company has been or if they have done business with multiple PEO companies and why they switched.
Reading reviews on their website is one thing, but when you are able to speak to people that have used them or are using them, that will give you a much better feel of how things are really going.
Always check the services that are provided. If you aren’t sure what services you need, you might want to speak with a consultant that can help you through this process. You want to have your bases covered. If you do not get all of your HR needs taken care of you could end up violating laws, tax codes and accrue penalties and have legal problems.
Some businesses find that a plug and play option is best for them while others only need to utilize part of the services that are provided because they are keeping a section of the work in-house. Find out if they have different contracts in case you only need partial services.
Conclusion
Getting the proper health benefits for your employees is important, but if you don’t want to break the bank, there are limited options. Working with a PEO company will help you get over this hurdle and back to what you do best. You shouldn’t spend all of your time working on HR when it isn’t your business. Your job is to grow your company for profits and in turn that allows for hiring and health benefits.
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