Cutting-Edge PEOs Help Workers Obtain Health Savings Accounts

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President Bush called for expanding use of health savings accounts by Americans in his State of the Union speech January 31. HSAs are already in place for employees of hundreds of small businesses in America, thanks to cutting-edge professional employer organizations (PEOs).

Professional employer organizations (PEOs) have already answered President Bush’s call this week to expand the availability of health savings accounts (HSAs) to Americans. Cutting-edge PEOs have enabled hundreds of small businesses to offer their employees the consumer-driven health care plan that businesses are expected to rapidly embrace 2006.

In many cases, the benefit plans PEOs provide workers at America’s smaller businesses are their only access to health benefits.

HSAs allow Americans to save tax-free dollars in accounts to pay for their health care expenses. These accounts are paired with higher-deductible comprehensive insurance policies that cover preventive care and larger medical bills. More than 3 million Americans have enrolled in these accounts since 2004, and recent research suggests that may escalate to more than 15 million by 2010.1

The PEO serves as the HSA facilitator and educator, working with the insurance carrier and

the financial institution offering HSAs. The PEO puts the HSA into place on behalf of workers at its client locations, which are generally small businesses, and educates the business owner and workers about their options for coverage of health-care costs. HSAs may be one of several coverage options that a PEO offers. To add an incentive for participation, the PEO client may contribute to each employee’s HSA. Employees own the accounts, which are portable if they move to a new employer.

PEOs are one of the most powerful business process outsourcing (BPO) developments in human resources. They are delivering a one-stop source of HR services for their clients. Recent research predicts that HR BPO will grow by 21 percent annually.

“PEOs lead other industries in delivering the best of HR management and benefits to small businesses in America. The HSA option is a terrific example of this leadership,” said Milan P. Yager, executive vice president of the National Association of Professional Employer Organizations (NAPEO).

A variety of cutting-edge PEOs are facilitating HSAs for clients and employees in multiple states. Several were early adopters of offering HSAs as an option for their clients and their employees. They include:

ADP Total Source

Employco, Inc.

Employer Solutions Group

Employment Traditions, Inc.

Merit Resources

MidwestHR, LLC

Odyssey One Source, Inc.

OEM America

QTI Human Resources, Inc.

The Castleton Group

LBMC Employment Partners, LLC

Offering an HSA option is just one part of a PEO’s comprehensive package of services and benefits for clients. The package includes management of human resources, employee benefits, payroll and workers’ compensation. PEOs relieve the small-business owner/operator of the burden of employment administration and also provide access to a comprehensive employee benefits package, including “cafeteria plans.” These services allow clients to be competitive in the marketplace.

For more information, visit NAPEO, especially the PEO Industry Information section.


1 “Seizing the HSA Opportunity: Developing a Winning Strategy to Grow Profits & Market Share in a Time of Transition,” DiamondCluster International.

NAPEO, the National Association of Professional Employer Organizations, is the recognized “Voice of the PEO Industry.®” NAPEO has nearly 350 PEO members found in all 50 states, representing more than 70 percent of the industry's revenues. Professional employer organizations enable clients to cost-effectively outsource the management of human resources, employee benefits, payroll and workers’ compensation. PEO clients focus on their core competencies to maintain and grow their bottom line.


901 N. Pitt Street, Ste. 150, Alexandria, VA 22314

Phone: (703) 836-0466

This press release was distributed through eMediawire by Human Resources Marketer (HR Marketer: on behalf of the company listed above.

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Edie Clark
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