Healthcare providers know just how easy it is to become mired in various issues when keeping HR in-house. However, the situation is not hopeless, as businesses that struggle to maintain HR protocols, policies, and procedures have other options. By taking advantage of professional employer organizations (PEOs) it’s possible to streamline operations, increase benefits, and reduce costs.
Few small and medium-sized businesses that provide healthcare have a dedicated HR department. This can make it difficult to stay on top of human resources issues, such as recruitment, and compliance with labor and tax laws. The undesirable situation can be compounded when owners pour time, energy, and money into growing their enterprise. With such an intense focus on growth, employers may find themselves able to offer few voluntary employee benefits, if any at all.
PEOs fulfill the role of an outsourced HR department. They assist with human resources, as well as benefits such as retirement savings options, and healthcare. By replacing their in-house approach with a PEO, healthcare providers can harness the following advantages.
The National Association of Professional Employer Organizations (NAPEO) has conducted several studies that show how PEOs can help businesses reduce costs. Among the findings were a 35% reduction on HR administration costs, a lower employee turnover, and growth is between 7% and 9% faster than small to medium-sized businesses that don’t use PEOs.
The benefits that PEOs offer are usually more attractive than those offered by a healthcare provider business, as PEOs can use the numbers of all their clients to negotiate better options. According to reports, AFLAC’s annual employee findings survey found that 60% of those surveyed would accept an employment offer for better benefits, even if it meant they would receive less pay.
A United Benefits Advisors study found that, on average, employers contributed more than $6,000 per employee to healthcare plans in 2017. The right PEO can help business owners reduce the cost per employee by as much as $2,400. If a healthcare provider business has a team of 15 employees, that reduction could lead to savings of up to $36,000 per year.
Health insurance, decent retirement savings options, voluntary benefits such as pet insurance, and paid leave not only make employees feel valued, they also offer a sense of security. This is understandable in light of the fact that the average cost of a visit to the emergency room for someone who doesn’t have health insurance is more than $1,200. Better benefits mean happier, more productive employees, as well as improved staff retention.
Better handling of HR issues is another advantage of using PEOs. Most small to medium-sized healthcare providers without a dedicated HR officer or team are too busy to deal adequately with the local, state, and federal regulations pertaining to human resources. PEOs have teams of experts who stay up to date with employment and tax laws, and who can assist business owners with wage and hour regulations.
Besides navigating an ocean of HR-related regulations, a PEO can mitigate HR risk in various ways. They can help healthcare providers to pay their employees timeously, in accordance with the law, and to become familiar with regulations regarding wage and hours. Additionally, they can assist with the compilation of employee handbooks that include policies that deal with discrimination and harassment.
With a PEO to ensure the business complies with the most recent state and federal labor laws, and that employees are remunerated as they ought to be, small to medium healthcare providers can enjoy the benefit of compliance relief. This ultimately could have a beneficial effect on employee morale, and on the business’ finances, as there’s less chance of being fined for breaching laws.
Improved HR technology is another advantage that can come with using PEOs. By utilizing HR software, a business providing healthcare can reduce costs, and improve the workplace experience. Better tech enables employees to perform standard HR tasks easily, whether they need to submit their work hours, request paid time off, or enroll for benefits. Other areas healthcare technology can assist in include analytics and reporting, and compliance with the law.
Along with offering technology that can streamline HR, PEOs offer training in the software and learning and development programs that big businesses use. This can help business owners meet employee expectations, which go beyond labor law compliance, and being paid on time. Many employees also hope to receive in-house training that can help them perform their tasks more efficiently and potentially enhance their chances of promotion.
Using a PEO can give healthcare providers access to competitive workers’ compensation insurance rates. Workers’ compensation is not an easy market, especially for the owners of small to medium-sized businesses. The rates of stand-alone policies can be exorbitant, and businesses usually need to appoint a member of staff whose role is to propose safety training, oversee return-to-work programs, and manage claims costs.
The flexible workers’ compensation options offered by Florida PEOs can help reduce costs for business owners, and can offer employees options better suited to their individual needs. Along with workers’ compensation, PEOs can include other insurance options, such as employment practices liability insurance. Such insurance covers lawsuits that may arise from discrimination or sexual harassment in the workplace, and from wrongful termination of employment.
The reduced costs, improved benefits, better learning and development, modern technology, and other advantages that come from using a PEO result in happier employees. Those workers will be less inclined to look for other employment opportunities, which could end up saving money for the business too.
A study by NAPEO found that PEOs helped businesses reduce staff turnover from 24% to 14%. According to the Society of Human Resource Management, it takes on average 42 days, and it costs more than $4,000 to find a new employee. In addition, the monetary value, training time and experience also has its own value, making employee retention a massive cost-saver.
Given the many advantages for small to medium-sized healthcare providers, using PEO for HR support is the sensible option. A load is taken off business owners’ shoulders, employees are happier, and their business stands to grow faster.