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Professional Employer Organizations provide American small businesses easy access to discounted employee benefit programs that rival the quality and flexibility of benefit plans typically reserved for a Fortune 500 companies. This makes working for small businesses more appealing for employees of all levels.

Employee Benefits

Many Professional Employer Organizations work with thousands of small businesses; through co-employing with each one of them they operate as one large conglomerate for the purposes of purchasing group health insurance – buying in bulk. PEOs leverage their discounted health insurance premiums to offset their administrative fees, often this can result in a net cost savings. The traditional PEO benefit offering provides easy access to:

• National Health Insurance Plans
• Group Dental Insurance
• Group Vision Insurance
• Group Life Insurance
• Group Short Term Disability Insurance
• Group Long Term Disability Insurance
• Company Wellness Programs

Most PEOs offer more than one health care plan design, so an employee is able to decide which type of insurance plan fits their budget. Having the option of multiple POS (Point of Service) plans, HMOs (Health Maintenance Organizations), and High-Deductible Health Plans with Health Savings or Reimbursement Accounts (HSAs & HRAs) is common practice for PEO clients. Supplemental benefits such as vision, dental, and life insurance are commonly offered to employees in a cafeteria format, which allows the employees to choose whatever plan they like, usually with a base stipend offered by the employer to help offset employee costs.

Retirement & Savings

Professional Employer Organizations also offer various investment vehicle options ranging from retirement plans (401k) to child’s college education plans (section 529). PEOs also offer health savings accounts (HSA) and flexible spending accounts (FSA) for out of pocket medical expenses such as co-pays, child care, and dependent care expenses.

Most 401(k) plans PEOs offer employees the ability to customize investment strategies through diverse groups of funds in order to satisfy different thresholds for risk and personal retirement goals. In most cases employees can monitor and manage their investment account through an account representative or online 24×7.

Seamlessly being able to offer such comprehensive benefits without the administrative burden of procuring and managing each plan is extremely valuable for a business that wants to focus on their core competencies. Compare the typical benefit package offered by a PEO to that of a typical 15 person company and the differences will most likely be staggering, not only in price, but in richness, and ease of use.

Be sure to bring up looking into a PEO the next time your company gets a double-digit health increase, you won’t regret it!