peo a fit for you

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Discussion points on how a PEO and the Insurance Industry benefit from strategic relationships to help clients streamline their operations.


  • 1. PEO: A Fit for You? PEO: A Fit for You? Presented by: eESI Ken Barge

2. Agenda

  • What is a PEO?
  • Interesting statistics!!
  • PEOs- Solution to business administration needs
  • Are all PEOs created the same?
  • PEO Friend or Foe?
  • Even PEOs love Healthcare Reform
  • How do they get those cheap insurance rates?
  • PEOs focus on the future
  • Question - Is he finally finished?

PEO: A Fit for You? 3. Who Am I?

  • Professional Employer Organizations
  • Former Property and Casualty Agent
  • Current Life and Health Agent
  • Former Workers Compensation Adjuster
  • Bachelors HR Management
  • Masters HR Development
  • Teacher / Speaker / Internet Radio Show

PEO: A Fit for You? 4. What is a PEO?

  • P rofessionalE mployer O rganizations
  • Enable clients to cost-effectively outsource
    • Management of human resources
    • Workers compensation / Risk management
    • Employee benefits
    • Payroll administration
  • Clients focus on their core competencies
    • Drive innovation, productivity and profits

PEO: A Fit for You? 5. PEO: A Fit for You?

  • What is a PEO?
  • Co-Employment
  • Contractual Agreement (CSA)
  • Sharing of Employment Responsibilities:
    • Between PEO / Client / Employee
    • Employer of Record
    • Grouping of these employment responsibilities
      • Administration, Efficiencies and Innovation

6. PEO: A Fit for You? 7. What is a PEO?

  • License requirements established by each state
  • Regulated by the Department of Insurance
  • SUI Account
    • Utilization of PEO experience modifier
      • Some states do require client modifier
  • Workers Compensation
    • Non Monopolistic State
      • Private insurers
      • Self-insurance allowed
      • Texas is the Lone Star state; allows opting out of the system

PEO: A Fit for You? 8. What is a PEO?

  • Relatively new industry ~ 30 years
  • Over 700 PEOs
  • 78 Billion dollars in revenue
  • 40 Accredited through ESAC
  • Average client size ~ 19 employees
  • Average wages $34,000
  • 2-3 million employed under a PEO relationship

PEO: A Fit for You? 9. PEO: A Fit for You? 10. PEO: A Fit for You? 11. PEO: A Fit for You? 12. PEO: A Fit for You? PEOs Solutions to Business Administration Needs 13. PEOs- Solutions to Business Administration Needs

  • HR infrastructure and technologies
  • Mitigate employment risk
    • Sharing of most employment liabilities
  • Compliance of regulations and future challenges
  • Bundle of products and services
    • Increase profitability
  • Ultimately reducing cost and focusing on your business
    • Maximize productivity
  • What have we failed to say?
  • Enhance benefit offerings

PEO: A Fit for You? 14. PEO: A Fit for You? Are All PEOs Created the Same? 15. Are All PEOs Created the Same?

  • All-Inclusive vs Carve out
  • National vs Regional
  • Accredited vs Non-Accredited
  • Licensed vs Non-Licensed
  • Large vs Small
  • How do they manage risk?

PEO: A Fit for You? 16. PEO: A Fit for You?

  • Leadership and Culture
    • Disney Michael Eisner vs Robert Iger
    • Smaller vs Larger agencies
  • Insurance agents and brokerage firms
    • Partnering with PEO opportunities
      • Larger regional insurance companies
        • Partnering with PEOs
        • Buying PEOs
      • Why? Because it extends products and services within their business model and adds value to current relationships

PEO: A Fit for You? 17. PEO: A Fit for You?

  • Questions
  • Whose client is it?
  • Will I lose control?
  • Is there revenue sharing?
  • Can I keep my current benefits?
  • Who holds the AOR?
  • Who services the account?
  • Is the PEO accredited?
  • What are the competitive advantages of your PEO?

PEO: A Fit for You? 18. PEO: A Fit for You? Even PEOs Love Health Care Reform 19. Even PEOs Love Health Care Reform

  • Impact on PEOs
  • How are they complying with the Act?
    • Small business tax credits
    • Grandfathered plans
    • Altered plans to comply with current regulations
  • Questions
    • Management carve outs
    • Individual mandates
    • Exchanges
    • Pre Existing Conditions
    • W-2 Reporting
    • MLR

PEO: A Fit for You? 20. How Do They Get Those Cheap Insurance Rates?

  • Multi-employer plans
    • Spread the risk
    • Underwriting guidelines
    • Design own plans
    • Uncertain how Healthcare Reform will impact
  • Consumer driven health plans
  • HRA/HSA/ GAP products/
  • Supplemental insurance
  • Strategic alliances with brokers

PEO: A Fit for You? 21. PEOs Focus on the Future

  • Change
  • Focus on service and strategy
  • Growth and increase in competition
  • Mergers and acquisitions
  • Growth in PEO market share

PEO: A Fit for You? 22. PEO: A Fit for You?

  • Twitter: @eESI_Talk
  • Ken Barge:[email_address]
  • Thank you to HAHU members and guestsfor the opportunity to participate at the July Luncheon.