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The Affordable Care Act has left many companies trying to balance the requirements of the law without significantly impacting their bottom line. The ACA requires all companies to provide health insurance if they have 100 or more full-time employees in 2015, while that number drops to 50 or more full-time employees in 2016. For many small to medium sized companies, it’s not only a matter of cost, but of handling the various complexities of remaining compliant.

An increasingly popular option for companies’ ACA strategies is Professional Employer Organizations (PEO) – a third party that handles employee management tasks. Those tasks can include payroll administration or employee benefits such as health insurance. Consider these factors to determine if a PEO should be a part of your company’s ACA strategy:

  • Cost
    A PEO can typically provide health insurance to employees at a lower cost than an individual company because of their buying power. Due to their higher numbers, PEOs can often negotiate more affordable rates for health insurance than a small or medium-sized business could on their own. Often the savings is enough to quickly offset the cost of utilizing a PEO.
  • Liability
    The ACA includes a variety of regulations that can cost employers fines if they are not adhered to, but can be difficult for business owners to stay updated on. A PEO is equipped with the expertise to handle the regulatory measures of the ACA and reduces company liability.
  • Time
    The number of tasks in managing healthcare can require a significant amount of time, and can take resources away from directly contributing to the core business needs. A PEO handles the administration of healthcare plans, and can free up key employees to devote more time to income-generating activities.
  • Employee Retention
    Not offering adequate healthcare coverage, or cutting hours and/or staff to bypass ACA regulations, may cost companies their best employees and make it difficult to gain top candidates for open positions. A PEO may help reduce turnover by making your company’s benefits package more attractive to employees and candidates. This can reduce significant turnover costs in lowered productivity and increased hiring/training expenses.


If you’ve determined that a PEO would be an ideal solution for your business, consider partnering with Ethan Allen Workforce Solutions. Ethan Allen’s PEO division, Staff-Line, has a proven track record of success and client satisfaction. We pride ourselves on partnering with our clients to ensure all of their unique PEO needs are met. Learn more about Staff-Line and how we can help you succeed.