Our posters took to the forum to discuss Professional Employer Organizations “(PEOs”) and how health care reform might affect them. Various agents offered their advice on what situations best merit partnership with PEOs, and detailed certain PEO scenarios. A PEO provides outsourced employee management tasks, by becoming a client company’s employer of record for tax purposes and insurance purposes, in a “co-employment” set up.
There was some heated discussion on the advantageousness of a PEO. One agent claimed, “If you’re placing groups with PEOs, you’re losing – and so are they. Payroll, HR, work comp, health insurance, and some other ancillary services can be acquired for much less than most PEOs charge, not to mention the ‘fees’ they associate as a percentage of payroll.”
Some industry experts see PPACA as an opportunity for PEOs. With the upcoming changes, these experts believe that PEOs will have the opportunity to provide guidance on PPACA, provide unique benefit offerings, and be a one-stop shop for a range of client benefit needs, as opposed to the medical and standalone dental offerings of the exchanges.