Outsourcing

Employee Benefits Outsourcing

In order to get a good employee, you need to offer a great salary. In order to keep him, you need to offer great benefits. That's why employee benefits outsourcing has become so popular in the past decade. Smaller companies simply cannot compete with big corporations in the field of benefits. Small companies do not have the negotiating power to bargain effectively with benefit providers.

Employee benefits outsourcing simply provides the best cost control for the fastest growing expense on your books.

The biggest component of employ benefits outsourcing is of course health insurance. The average company now spends almost $5000 a year on a single employee and over $12000 a year for a family of 4. That's a huge drain on the company. But individuals need their companies to provide health insurance because they have even less leverage on their own.

Employee benefits outsourcing companies offer PPO and HMO plans as well as optional dental, vision, and life insurance, supplemental insurance, and 401k programs.

But employee benefits outsourcing is not limited to health insurance. Some of the other things an employee benefits outsourcing service can provide include flexible spending account administration, premium only plans, COBRA/HIPPA administration, transportation reimbursement incentive programs, defined benefit administration, leave of absence administration, patient advocacy administration, premium reconcillation, enrollment reportment, and total compensation statement generation.

If you are a company with 20 people, you probably cannot afford to have a full time human resource professional deal with all of these issues. Your poor, overworked office manager is probably dealing with them as best as she can. But having an employee benefits outsourcing company handle them for you is a godsend.

In addition to the employee benefits, outsourcing companies will also handle payroll related compliance tasks such as payroll taxes and worker's compensation.

Currently there is $11 billion in employee benefits outsourcing. That number is likely to double by 2012.

In some states like California where workplace regulations are both unique and stringent, it may make sense to go with an employee benefits outsourcing company with state-level expertise.

Employee benefits outsourcing is essentially human resources made easy. As a manager, you no longer have to worry about compliance. You no longer have to worry about loosing your best employees over a bad benefit plan. You no longer have to worry about COBRA and HIPPA headaches. Instead, you pay a small fee to an employee benefits outsourcing firm and let them have the worries!

Article Published: Monday 17th December 2007