As President Donald Trump finalizes the deals of his new healthcare plan, the entire Human Resources industry looks on.
President Trump offered five principles for healthcare reform, including tax credits to assist individuals purchasing their own health insurance coverage, expanded use of health savings accounts, increased flexibility for implementing Medicaid, reduced prescription drug costs, and medical liability reform to protect both doctors and patients from expenses that increase the price of their insurance.
According to SHRM, an emphasis on benefits flexibility was also touched on by the president, which could have an impact on outsourcing HR and Professional Employer Organization (PEO) Payroll solutions.
As the new healthcare policies unfold, small-to-medium-sized businesses will likely consider outsourcing their bureaucratic HR aspects to PEO service providers.
NAPEO reports that McBassi and Associates released a recent study showing 14% to 16% of small businesses (organizations with less than 100 employees) use a PEO for help with payroll, HR and benefits.
“This study shows that small businesses with under 100 employees are embracing the concept of outsourcing their HR needs through a PEO and are reaping important and tangible benefits from doing so,” said Pat Cleary, President and CEO of NAPEO. “Small businesses that use a PEO grow faster, have lower rates of employee turnover, and higher rates of business survival than other comparable small businesses.”
Organizations that utilize PEO services for at least four quarters are 50% less likely to permanently go out of business in a year’s time compared to the overall rate for similar U.S. businesses that don’t use some kind of outsourced employee benefits management software service.
The Internal Revenue Service (IRS) recently implemented a voluntary PEO certification program that could contribute to the success of the PEO industry and other markets as organizations understand how outsourcing their benefits, payroll, and administrative duties can help.
“More and more small business owners are realizing the value of the HR solutions PEOs provide,” Cleary added. “And we expect that to strengthen with the IRS’s new PEO certification program and the ongoing improvement of the economy.”
PrismHR’s software for PEOs helps HR outsourcers provide self service for employees of their customers and can improve business for their clients. To find out more about how PrismHR payroll solutions and other employee benefits management software can help your PEO, contact PrismHR today.