Dec. 16, 2015
Kenneth Daniels, OD, FAAO, Dipl. ABO, owner of See Life – Hopewell & Lambertville Eye Associates in Hopewell and Lambertville, N.J., recommends contracting with a Professional Employment Organization (PEO) vs. hiring an office manager–for cost savings, additional benefits and accountability. A PEO also can provide premium benefits to long-term employees whose tenure can otherwise impose “salary creep.”
Professional Employer Organizations: Improve HR & Office Efficiency
PEO Advantages
Training. The PEO trains the practice owner on human resources issues like the different types of insurance and pensions offered, which a practice owner might not easily understand on their own.
Competitive package. Ability to offer a competitive benefits package, on par with large corporations. Can offer staff up to 30 different mutual funds to choose from.
Cost effectiveness. Less expensive than hiring a business, or office, manager, which can cost a practice up to $70,000-$80,000 in salary. A PEO, in contrast, may only cost slightly more than a payroll service, maybe as little as $25,000 a year.
Accountability. PEO is accountable to government regulation, so it is a safer option in entrusting with the management of the practice’s benefits and payroll than a private individual, who could embezzle from the practice.
Enhance benefits. Offering enhanced benefits through a PEO can stem salary creep in which staff salaries are expected to increase each year to keep pace with the cost-of-living, or the consumer price index.
Simplicity. PEO reports directly to your practice accountant, simplifying tax reporting.
When Looking for a PEO, Ask About:
Flexibility. How much flexibility is offered in negotiating medical insurance benefits?
Reporting. Will they do your tax reporting for you?
Flex Spending. Do they offer additional benefits for staff like flex-spending and other voluntary benefits?
Resource
National Association of Professional Employer Organizations
Also in ROB
Professional Employer Organizations: Improve HR & Office Efficiency
Kenneth Daniels, OD, FAAO, Dipl. ABO, is owner of See Life – Hopewell & Lambertville Eye Associates in Hopewell and Lambertville, N.J. To contact him: kennethdaniels@att.net