I’ve been a small business owner for nearly 20 years and I still get hives when it’s time to renew health benefits. And it’s no more fun for employees trying to determine whether our latest plans and how we administer them will cover what they need.
We’ve been on a health benefits journey that has taken several turns. First it was covering self-insured costs when there were a few of us. Then we found a broker and a group plan when we barely qualified as a group. Then we moved to bigger group options and eventually to a PEO because we thought that was best way to offer “big group health insurance” choices and cost savings that matter when you’re competing for talent.
In all that time, people elected plans, got insurance cards, hopefully got the coverage they needed by it’s always been a guessing game as to whether we were “optimizing” our costs and maximizing plans that matter to people of all ages with different health considerations and needs.
What is a QSEHRA?
For small businesses who don’t want the administration headache of being both an owner and a group health benefits administrator, there is a newer alternative to group insurance and PEOs.
A QSEHRA is a Qualified Small Employer Health Reimbursement Arrangement that was created by Congress in December of 2016 to help businesses with fewer than 50 employees offer non-group health benefits. The word arrangement is important because this isn’t a plan, it isn’t coverage, it is literally an arrangement through which the business can set aside a pre-tax allowance to reimburse employees health care costs.
That’s all well and good, but an “arrangement” sounds like it could also be difficult to administer or communicate about with employees which is where companies like PeopleKeep come in.
Automated platforms & services to help with QSEHRA administration
Victoria Hodgkins, CEO of PeopleKeep, spoke to me about the challenges of providing flexible coverage when you are a small business. Hodgkins who got her MBA at Harvard Business School, has spent her career in B2B software, much of it in the healthcare IT and clinician space.
While she was CMO of BambooHR, she worked firsthand with SMB owners and recognized the challenges small businesses have with handling complex programs. When she got the call from a recruiter about the opportunity with PeopleKeep, she was excited to connect the dots between her experience and this new area of benefits.
According to Hodgkins, research shows that healthcare benefits are the single most important deciding factor—besides salary—when considering a job. But to offer competitive benefits, business owners often have to give up too much control or absorb too costly an administrative burden.
In many small businesses with 5 or 10 employees, they operate more like a family and rely on each other. Hodgkins said her customers are more passionate about “taking care of their people” than “administering a health program.”
PeopleKeep is a benefits automation platform and service provider that supports owners and their employees. The solution is cloud-based with easy login for employees and administrators, which is a step up from what many small businesses deal with when they try to manually administer benefits.
Hodgkins says the company plays an important role as an intermediary ensuring that you as the employer never see HIPAA-related documents and that your people have someone to turn to help navigate health coverage, processes and paperwork. I remember years ago, when an employee got badly injured at home, trying to help the employee’s girlfriend understand coverage options, find proof of insurance, and connect her to the proper insurance contacts and information over several days. In a small business this is no small thing because you’re “a man down” in terms of your team, but more importantly concerned about the individual’s well-being, and also working to help understand and clarify the benefits process. That’s just a few more hats the SMB owner gets to wear.
The future of benefits that SMBs care about
As a small business owner, you may want to extend all sorts of options to employees, but often not knowing how to administrate in a compliant manner stands between your hopes and reality.
I asked Hodgkins what sorts of things might be on the horizon that a company like PeopleKeep might help small employers with. She points to things that are great in theory by may be complex in terms of compliance. In addition to continued changes and evolutions in HRAs, she is keeping her eye on:
- The Secure Act, which is a part of retirement benefits reform, currently in the Senate. Some of the proposed changes might make it easier for SMBs to offer retirement benefits—provided they have the expertise to administer them.
- Various student debt reimbursement acts. Work is being done on a student debt related program, similar to how an HRA works, that could help employers pay down their employees student in a tax-free arrangement.
Hippocrates said, “Healing is a matter of time, but it is also sometimes a matter of opportunity.” The same can be said for benefits and other programs that small business owners wish they could offer. Thankfully there are companies focused on making these opportunities possibilities—and automating them in the cloud.
Source: Forbes – Entrepreneurs