Employee Benefit Plans for small businesses are notorious for double-digit inflation. The threat of the unsustainable benefit plan is a fact that many small business owners face every year at renewal. Here’s a way to stop having that awkward renewal conversation with your benefits provider; make the most used portion of your benefit plan a fixed and predictable cost. This way, you can limit your plan increases every year.
Health Spending Accounts (HSAs) are among the best-kept secrets in the benefits industry that offer tremendous opportunities to employees and employers. Below is a list of 10 perfect reasons why your company should seriously entertain utilizing the merits of this little known yet often heralded non-benefit plan Benefit
1. Tax-Free Money
Whether you’re a Business Owner or Employee, Health Spending Accounts will allow you to pay for health services and products as a business expense and tax-free to your employees.
2. Coordinating Benefits with Spouse’s Benefit Plan.
Everything from co-pays and deductibles to orthodontic expenses is eligible for reimbursement under HSA rules.
Also, because an HSA is not considered a benefit plan, your spouse’s plan will always be first-payor.
3. Can Be Used On Its Own or in Conjunction With a Benefit Plan
Whether used to supplement an existing plan or a stand-on-its-own plan, HSA’s are entirely flexible in setting up for employees.
4. HSA Amounts can be Increased or Decreased At Any Time
HSA’s can be increased or decreased at any time depending upon whether your business budget warrants it
5. Amazing Tool For Retaining and Attracting Employees
A perfect tax-free tool to retain and attract the best employees without the expense and uncertainty of an insured plan
6. Cost Certainty
Because it’s a Health Spending Account and not a benefit plan, you’re not subject to hidden fees, annual increases. It is a fixed cost that you don’t need to worry about year to year.
7. Perfect Starter Benefit Plan.
Because of the fixed cost nature of HSA’s, you will not be subject to the typical 8-15% year-over-year increases that standard benefit plans are subject to.
8. No Co-pays or Deductibles
HSA’s will often pay more of an identified benefit. An HSA can be used can use it to pay your spouse co-pays and deductibles.
9. Unused HSA Amounts Go Back To The Employer
Unlike traditional plans, unused HSA amounts get reimbursed to the employer and are not absorbed by the insurance carrier.
10. Unused Amounts Can Get Carried Over To The Next Year
If an employee doesn’t use their allotted Health Spending Accounts in one given year, the HSA can be rolled over into subsequent years.
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This article isn’t proclaiming that an HSA is ideally suited for every company. A small business that faces huge increases every year will want to investigate the advantages of Health Spending Accounts over traditional benefit plans. HSA’s are an excellent opportunity to contain costs for small businesses. They are an excellent alternative for those companies that have delved into the benefit plan market previously, only to realize the cost was unsustainable as a business.
Ideally, HSA’s should be layered with an element of insurance to mitigate against catastrophic illness. Any other personal insurance such as life, disability, or critical illness insurance should be considered part of the benefit plan.
Chris’ Bio
Through the bankruptcy of his first business, a strong balance sheet means nothing unless you can get the money out of your business and into your hands personally, tax efficiently, and creditor protected. Chris helps and coaches business owners to avoid a similar fate as he suffered in his first business.
Through several clever strategies, he illustrates how these little-known vehicles can get money out of your business efficiently, build your corporate brand and create a legacy through charitable means to help make a meaningful difference in the lives of others.
Also, he has seen the impact that mental health can have upon success within your business and your life and how the two are on a constant collision course. When Chris became aware that Entrepreneurs struggled with their mental health at more than twice the rate of average adults, he realized he wasn’t alone and made it his ambition to understand why and do something to help. His business, The Finish Line Group, aims to help support the entrepreneur’s financial, philanthropic, and emotional needs.
Chris’ Why Statement remains, “To openly communicate the lessons learned from my past so that others will thrive in their lives, minimize their setbacks and leave a positive and lasting legacy.”
