[aa_subtitle_display]Are the benefits your company offers its employees up to par? Having great insurance plans can attract and keep great employees, but it can be expensive. Now with the Affordable Care Act (ACA,) there are more regulations that need to be met. It has also raised some premiums as insurance carriers have taken on more risk to insure more people, and with many people being eligible for free or low-cost insurance, some of the extra cost may be passed along to small businesses. Many small and mid-sized businesses are passing those costs on to their employees.
Working with a PEO has a lot of perks when it comes to making sure that your company is ACA compliant. When a company partners with a PEO, the PEO becomes the employer of record for the client company’s existing employees. On paper, the workers are employed by the PEO. This means that the PEO takes over administrative duties like payroll and benefits, which means that they must stay ACA compliant on behalf of your shared employees.
With the PEO covering benefits, they will ensure ACA compliance. PEOs were prepared when the ACA came into effect a few years ago, they are familiar with the requirements and how to meet them. According to a study by ADP RI, many employers are concerned that they won’t be able to meet ACA requirements because they may have difficulty gathering all of the necessary data from their different systems, like payroll, human resources, benefits, and time and labor management. If a PEO covers all of these services for a company, they will be able to plug in the data from each different system to be able to report the required healthcare-related information to the ITS.
You may have noticed steep renewal increases as insurance providers adapted to the ACA, even years after it was put in place. Luckily, a PEO can help businesses save money while providing great plans. Because a PEO represents a large number of employees, they qualify for better rates and may be able to negotiate. This way, you can save money while still providing great, ACA-compliant plans.
Navigating ACA compliance is tricky, especially if benefits administration is not your main duty within your business. Partnering with a PEO means that you can stop stressing over ACA compliance and get back to your usual duties. By staying compliant, you’ll reduce risk for your business. Plus, you’ll just save time and money for both you and your employees while still offering a great insurance plan. Talk to a PEO consultant about finding the right PEO to meet all of your needs and keep your business ACA-compliant.