It's no secret that benefits are a major factor when someone is looking for a job. Benefit packages also play a big role in establishing loyalty and boosting employee retention to a company for current employees. But for many small businesses and startups, it's too expensive and too much trouble to offer competitive perks like a big corporation would do.
So what's the solution?
Two words: personalized benefits.
What are personalized benefits?
Your employees aren't all the same. They are individuals who come from different backgrounds and have diverse expectations and needs. So how do you make sure they are all happy and getting the most value when it comes to their health insurance?
Traditional, one-size-fits-all group plans are just too expensive and too clunky. The worst part? Your employees might not be getting the best value for their unique situation and as a business owner, you are stuck paying for all of the extras and leftovers that they don't perceive as valuable.
The best staff loyalty and employee retention solution
So what's the solution? Personalized benefits, which come in the form of a QSEHRA (Qualified Small Employer Healthcare Reimbursement Arrangement).
No one knows your employees' needs better than they do. So put the power into their hands to choose their own health insurance coverage that works best for their unique situation, their preferred doctors, and their prescriptions.
With a QSEHRA, you can give your employees a fixed dollar amount each month, say $300, and each employee can then shop for the plan that fits his or her needs the best. Lilly can choose a Blue Cross plan for her doctor, Henry can get Aetna to cover his prescription, and Suzie can stay on her husband's plan. Gone are the days of comparing quotes from each insurance company or the headache of trying to get everyone what they want without breaking the budget!
Why QSEHRAs are a big deal
The most important thing about the QSEHRA is that it allows business owners to reimburse employees tax-free for individual health insurance premiums and medical expenses. This is a big deal because small businesses can now get the same favorable tax treatment as big company group health plans but with a lot less hassle.
Established at the end of 2016 with a bipartisan law called the 21st Century Cures Act, QSEHRAs are proven to be more efficient, affordable, and predictable. All things that small businesses and growing startups need!
Unlocking savings with personalized benefits
Does something customized, tailored, and personalized sound pricey? With suits, that might be the case. But with benefits, it doesn't have to be. The good news is that you can set the budget based on what your company can afford, and these reimbursements are tax-free, which is a major step above simply giving them a raise to purchase their own health insurance, which would be subject to taxes.
In fact, small business owners can typically pay less because their dollars are being optimized for each individual versus spread out over the whole. Your employees get exactly what they want and you don't have to pay for extra waste.
Businesses typically save 7.65% in payroll taxes and employees save 20-40% in state and federal income tax on money spent on health insurance premiums and medical expenses reimbursed through HRAs.
Sounds like a win-win!
How Can Take Command Help?
Does this sound confusing, expensive or both? Don't worry. That's where Take Command's small business platform can help. We'll handle all the accounting and legal legwork, take care of onboarding each of your employees, and make tax time easy and painless. You'll never have to hassle with receipts or worry about setting up a health plan again.
Want to see if an HRA could work for your small business to offer personalized benefits? Learn more about our small business platform or schedule a call with one of our small business HRA experts today.
I wrote this blog because I care about ideas (big and little) that can help fix our healthcare system. I used to work on projects for Kaiser Permanente and the Parkland Health & Hospital System so I've seen the system inside and out. It's so important that consumers keep up with industry shifts and changing health insurance regulations. I'm also Take Command Health's Content Editor and a busy mom. Learn more about me and connect with me on our about us page. Thanks!