Health care reform is designed to make it easier for all Americans to gain access to quality, affordable health coverage. But for business owners, this sweeping legislation adds additional weight to an already cumbersome load of administrative burdens.
If you’d rather focus on the core functions of your business, a relationship with an HR outsourcing company – more specifically, a professional employer organization (PEO) – can help with the complexity, compliance and cost brought on by health care reform.
A brief introduction
A PEO offers a comprehensive suite of products and services aimed at relieving the business owner of many of the company’s pesky administrative tasks. A PEO is unique form of HR outsourcing because the PEO becomes a co-employer of your employees.
In this “co-employment” relationship, you maintain control of your organization’s prime directive, making money, while the PEO assumes responsibility and liability for the majority of those time-consuming HR chores.
Making sense of it all
Health care reform legislation and related guidance checks in at around 22,000 pages. It’d be easy for a bona fide health care expert to get lost in all that ink, much less a business owner, and guidance is still being issued.
Signing on with a PEO enlists the help of a team of specialists whose job it is to understand health care reform and its impact on your business. This means helping you understand what rules affect your business and what actions you may need to take to comply with those rules. In many cases, the PEO will handle any actions that may be necessary.
Additionally, you’ll be covered when state and federal labor laws change because your PEO will be on top of it. There are more than 300 state and federal agencies that can levy fines and penalties should you fail to meet their guidelines. With a PEO on board, your focus can stay on your business and not on constantly shifting legislation.
The best example of this is the recent one-year delay of the health care law’s employer mandate and reporting requirements for larger companies, which was originally slated to go into effect on Jan. 1, 2014.
Making cents of it all
Now beginning in 2015, employers with 50 or more full-time employees – including full-time equivalent employees – must offer qualifying coverage to their full-time staff or face a possible penalty. Employers with fewer than 50 full-time employees dodge this “play or pay” mandate, though many choose to offer coverage anyway.
Regardless of company size, offering health insurance will cost you. Health care reform creates billions of dollars in taxes and fees that will be absorbed by those who purchase coverage starting in 2014.
Co-employment helps ease the burden by providing employees access to a large-group insurance plan sponsored by the PEO itself. That typically means more coverage options and more savings when compared to the expected volatility of the individual and small group health insurance marketplace.
Handling health care reform is just part of what a PEO offers its clients. Many start by taking on a company’s payroll processing, withholding and reporting. Additional services might include:
- Benefits offerings (e.g., flexible spending accounts, life and disability insurance)
- Performance management
- Training and development
- Workers’ compensation
- Recruiting and screening
- 401(k) plan administration
The same big-company advantages that apply to health insurance can also be enjoyed here. These include access to safety training and risk assessments as part of the workers’ comp package, as well as a better price and greater variety of fund options in the 401(k) plan.
Health care reform doesn’t have to be a headache. Learn how a co-employment relationship with Insperity can give you peace of mind.