Expert Strategies To Maximize Your Employee Benefits While Keeping Costs Down

By: Renne Anne Alo and Daniel Nessim

One of the most challenging aspects of being a small business owner in today’s economy is providing a valuable benefits package to your employees while not breaking the bank. You want to lead a staff of workers who are happy, productive, and healthy, and a big part of that is providing them with what they need in order to take care of both their mental and physical health. However, the costs for being able to do so are continuing to rise.

I asked Danny Nessim, who is an expert in helping small business owners battle this obstacle, to give us his advice. He started A&C Management more than 25 years ago to put his expertise as a talented insurance and PEO broker to good use, negotiating with heads of PEOs and helping leverage large group benefits for his clients. He knows the importance of benefits for an employee’s wellbeing. He says:

Employees who have access to health insurance services tend to be healthier overall with less need to take leave for sick days. Maintaining healthier, happier employees goes a long way towards improving overall productivity.

As a business owner responsible for providing these benefits, you may feel overwhelmed by the costs. Fortunately, there are options available for you to choose from.

[Related: Five Steps To Staying Informed With Health Insurance]


Take time to investigate.

Switching your current benefits package or even starting a program can be timely. Time is something you are probably short on, but it can save you a bundle of money in the long run.

There is no one-size-fits all compensation package for business owners, and only you know what works best for your staff. Taking time to investigate the market and your options.

The majority of small businesses tend to go with traditional health plans, which include the following.

Health maintenance organization.

An HMO limits coverage of employees. This means your employees can only see those doctors who are listed. HMOs do tend to have low premium rates.

Preferred provider organization.

A PPO is favored among employees, and for good reason. It gives employees options with a large network of practitioners with no referrals. It can be used by all employees but typically comes with a deductible, co-pay or maybe both. The premium is normally very high.

High deductible health plans.

This option has very low out-of-pocket costs, but as its name implies, the deductible is high for out-of-pocket costs. Employees typically get to see their own doctor.

[Related: Four Things to Improve Your Financial Health in the New Year]

Consider a professional employer organization.

Another option for saving money on health and benefits is a professional employer organization. These organizations allow your company to receive corporation benefits at large group pricing and cheaper rates than a small business receives standing on their own.

With the Affordable Cares Act in place, a business owner is required to have health insurance for her staff if she has more than 50 full-time employees. Due to this, companies are turning to PEOs for their plans and coverage, which can include dental and eye care. Nessim explains:

The PEO is an exciting product that brings value to small and medium-sized companies by being able to provide them with Fortune 500 benefits. Companies are able to get pricing for their health insurance benefits at a 20-30% discount.

As a business owner, you need to understand the difference in the two PEO options. The first is a customized plan just for employees. The other will save more money because it allows access to its master health policy that contains several insurance plans.

Finding the right PEO can help you get the ball rolling on seeking out the PEO best suited for your company. Nessim says:

Some PEOs are better suited for white collar companies, others for blue collar, some specialize in working with startups, and each PEO has slightly different benefits and services.

Managing overall wellness.

Encourage your employees to stay active and put those wellness checkups and dental visits to good use. Reassure your employees their health is a priority.

In the meantime, don’t forget to make the wellness of the company a priority, too. Once you’ve decided on a plan, the costs do not end there. Administering those benefits can be just as costly over the years. Careful management is a must.

There are ways to manage these expenses in a cost-effective way, such as with online tools that allow you to oversee daily reporting and expenses. PEOs also can help you outsource human resource responsibilities and administrative tasks so you can focus on what you do best, running your business.

There’s no need for small and medium-sized business owners to get overwhelmed by the costs and frustrations of providing the benefits their employees deserve. Take the time to seek out the right option that will leave both your employees and your company healthy for the long run.

[Related: Millennials Want a Healthy Work-Life Balance. Here’s What Bosses Can Do.]

Renne Anne Alo is a communications specialist who helps entrepreneurs and executives create and maintain their brand identity. She has worked with several businesses from multiple industries and helped them manage their communications campaigns.

Daniel Nessim is the president and founder of A&C Management, a national leader in insurance and benefits services. He has his series 6 and 63 and is a certified Life, Accident, & Health Insurance broker in multiple states.

The Tycoon Herald