Name: jeff kuzmich - jeff kuzmich - Migrate_Affordable_Healthcare_Solutions_02112026_5205393
Uploaded: 2026-02-26T05:52:39.170Z
Duration: 54 min 29 s
Description: jeff kuzmich - jeff kuzmich - Migrate_Affordable_Healthcare_Solutions_02112026_5205393

Transcript for "jeff kuzmich - jeff kuzmich - Migrate_Affordable_Healthcare_Solutions_02112026_5205393": Hello everyone and welcome to today's presentation, Affordable Healthcare Solutions for Balancing Rising Costs with High Impact Employee Coverage. I'm your host Rob Parsons. Before we get to the presentation and dive into the information, let's briefly review some housekeeping details. First of all, please note that the primary audio is going to be streaming through your computer. There's no dial in option. So just make sure you have your speaker volume set correctly, so you can hear everything. Also, sometimes you have to refresh your browser just to make sure the webinar console works okay. You can see the key commands here to, make that happen on, respective platforms. So let's take a look at a couple other important features. You can download and print a copy of today's deck for future reference, and you can access additional resources in the files and resources window that's at the top right of your console. It's available anytime during the event. If you have any questions during today's webinar, you can send them via the ask us a question window. To submit a question, simply write in your question and click submit. We have some folks in the back end supporting QA today, and while we may not be able to respond to every question individually in our live discussion, we'd love to have all the questions come in because it helps us create future resources like this to help strengthen your business. And of course, as always, note this presentation does not constitute legal advice. This is for informational purposes only. And now, I'd like to introduce today's speaker. Alec Meckling is the Director of Customer Success and Operations for the Paychecks Insurance Agency. A successful benefits consulting leader with more than twelve years of experience, Alec has a proven track record in driving sales and revenue growth, developing and executing business strategies, managing complex projects, leading high performing teams. His expertise spans all facets of employee benefits, including benefits compliance, consultative sales, and customer experience design. Paired with deep knowledge in relationship management, digital health solutions, and strategic business planning, Alex brings a well rounded perspective gained from working across publicly traded companies, startups, and privately held businesses. He's known for his ability to align cross functional teams, implement change effectively, and develop talent to support sustainable growth. Alex, welcome to the event today, and I'm really excited to hear everything we're going be covering. I'll take you all through this agenda real quick. Alex is going to be talking about trends in employee benefits and ancillary benefits, how your clients can unlock their value for business and employees. But before that, he's also going to cover new strategies for funding health benefits. Know that is what a lot of you are here for. With the rising costs, we need creative and thoughtful funding approaches. So now I am going to hand it over to Alex to talk a little bit about the latest trends in employee benefits. Thank you so much, Rob. Appreciate it. Thank you for everybody who has made the time to chat today and tune in. Obviously, we know this is a very significant topic of interest, for employers today. And so so we appreciate you taking the time to hear what we have to say and hopefully get some information from us. So let's take a look at really what the benefits landscape looks like right now today. First and foremost, coming in at no surprise to anybody on this call, health care costs are increasing rapidly, as is the complexity around health care. Health care costs are projected to jump 10% this year, 2026. And so obviously that's creating a significant amount of pain for employers as well as employees. But it's really not just the money. It's also the complexity. There are more regulations that are coming out. There are more regulations, in front of government today around health care. There are new solutions, new plan options that are emerging, some to combat costs, some to navigate the regulatory environment, some just new offerings, to think about health care a little bit differently. All of this together is increasing administrative burden. The challenges that HR professionals, finance professionals are feeling within the employer environment. And so it's harder now than ever before to manage benefits well without expertise, without someone to shepherd you through all of this complex web of cost regulation and administration. The other piece of this, of course, is employee impacts. Employees today are expecting flexibility in choice. Really, what's changed is that employees historically wanted to just be given some options and said, this is what your health care product is. This is what your options are. Go ahead and enroll. Employees have shifted. They no longer want to be told what health plan they're getting. They actually want options. They want plans that fit their families, that include the doctors that they want to see, their lifestyles. A one size fits all strategy doesn't really work anymore. And so today's workforce is expecting benefits that reflect their individual needs and employers who can't offer that are actually at a disadvantage when it comes to attracting and retaining talent. The other piece of this, as we've already mentioned, is compliance. That's a top of mind consideration for everybody in the employer space. Whether employers like it or not, they are in the benefits compliance business, as part of offering health benefits. And so whether it's the Affordable Care Act, ERISA, COBRA, state specific regulations, compliance is complicated. The penalties for getting it wrong are real. While laws and regulations continue to change, the need to comply does not. And so employers are constantly asking, am I doing this the right way? Am I exposing my business to risk? And frankly, staying compliant shouldn't consume all of an employer's time and energy, but for many businesses, it does. And so here's the reality, the old playbook that doesn't work anymore. Rising costs, employee expectations, compliance demands, they have become overwhelming. And employers need a partner who can help them simplify this entire benefits ecosystem and save on their budget. Now, the good news is that's exactly what we at Paychex are here to do. We help you navigate this landscape with clarity, strategy and solutions that actually work. So as we dive into that, I would like to hand it back to Rob to do a quick poll just to get a pulse check from our audience here today. Excellent. Thank you, Alex. So everybody, you are going to see a poll pop up separately on your screen. Just click the answer you like, click submit, I'll give it a few minutes, just to give everybody a chance to respond. What is your biggest challenge with offering a benefits program? The first option, of course, is cost, we all know that that's there. Choice of offerings. You touched on that, Alex, what comes on there. We also have participation. Are employees actually participating in this poll? A lack of support, maybe it's through your providers or it's just trying to navigate this landscape on your own? Or is it something else entirely? I'd be very interested to see there's a lot of, you know, just based on what you laid out, Alex, a lot of these could come into play. So I'm really interested where people are facing the most critical choice. We're just, we're about 40%, so I'll give people just a little bit more time to go through here. Your biggest challenge with offering a benefits program. And here we go, and look at, oh boy, look at this, Alex. Number one, far and away, is indeed cost, followed by choice of offerings. But what are you seeing there? Is this lining up with what we are seeing out with the client base and with the marketplace? Absolutely. Cost is and will remain the primary consideration. Choice of offerings, I think, is also a really important call out here because as we think about cost, and actually I would say choice of opportunity and participation, sort of our top three, they're all interrelated. Cost, absolutely far and away the biggest piece for most of the folks that are on the phone today, I'm certain that benefits costs are probably the second, maybe the third largest item on their balance sheet from an expense perspective. And those numbers are going up and they're going up by double digits every year. And so that becomes untenable. And what happens when that's the case is we actually have to be able to provide choices and options and solutions and different things that we can do to actually solve that cost problem. A byproduct of that is when costs go up, people make the trade off to say, I'm not going to pay for health care anymore because I can't afford it, whether that's at the employer level or at the employee level. So that's where we run into this participation piece. And so really all of this is interconnected. And now the good news is, is that there's not a silver bullet, but there are definitely strategies that we can pursue and that we do pursue here at Paychex for our clients to actually help bend this cost equation so that we can actually help make a more sustainable offering a reality tackle some of those challenges. So let's kind of go back to really kind of the current state of employee benefits and think about what benefits are the most valued by employees. And I think unsurprising to anybody here, health insurance remains the most widely offered employee benefit, for good reason. The numbers really tell the story. 72% of businesses that have five to 19 employees will offer some sort of benefit program. That number jumps up rather substantially. When we get to employers with 20 to 49 employees, that number jumps up to 87% of those employers offering benefits in the health insurance space. And then as we get to above 50, that's where we see 94% of employers offering some sort of medical benefit program. So the question really isn't whether as an employer you should offer health insurance, it's really how do you manage everything that comes with it? And frankly, that's where the real challenge is. So first, the rising costs that we talked about, there's uncertain relief around that. There are strategies to be pursued, but the costs continue to climb. Premiums climb year after year. Many businesses are simply absorbing those costs or passing those costs along, which we'll talk about a little bit further into the presentation. But the costs increase are real and they're compounding every single year. And so it becomes a question of sustainability and what's to be done about that. The second thing is that compliance is complicated. The Affordable Care Act brought some very important protections into the health insurance world, but it also brought a maze of requirements. As an employer, now you're responsible for tracking eligibility, managing mountains of paperwork and reporting and staying current on ever changing regulations. And if you make a mistake, there's potentially penalties and very significant penalties that may be waiting for you. And third, and this may surprise some, on this call, is that if all of your competitors in your arena for talent are offering health insurance, then offering health insurance in and of itself is not really a differentiator. Employees are expecting it as table stakes. So what's actually becoming attractive as far as bringing in new talent, retaining existing talent, is offering flexibility around those benefits choices, adjacent services like mental health support, leave policies. These are the benefits that are now starting to set employers apart. So yes, health insurance is essential, but it's also expensive, complex and expected. The good news, however, is that there are really a number of very simple things that you can do as an employer to try to tackle this complexity. And that's exactly what we're here to talk about today. So we can jump to the next piece. So, what is really this roadmap to affordable benefits? As the most widely offered benefit, health insurance coverage has increased from 70% to 77% of employers offering it as their top benefit, the thing that they lead with when it comes to benefit offerings for talent. So more businesses are stepping up to provide coverage, which is great. But what's really interesting about that is that benefits that get more into well-being, are actually emerging as a new priority. And we're seeing across our book of business 41% of employers offering some sort of benefit tied to well-being, whether that's stress and anxiety management support, behavioral health services, flexible working arrangements, and broader sets of choices in the benefit offerings themselves that they're offering. So what that tells us is that employees want more than just basic health insurance coverage. They want flexibility, choice and support for their overall quality of life. Now, I understand what you're probably all thinking, which is how are we supposed to manage rising health care costs and add new choices, new options and additional benefits? How do those two things work together? And it's challenging. But the good news is, is that the choice doesn't have to be one or the other. There are smart practical ways to do both. And it really comes back to funding. How do we pay for the health care benefits? How do we structure your health care benefits? So let's jump into that piece of the equation. So there are a variety of strategies that we can look to. The traditional models, as we mentioned, are evolving. Employers want cost control and your employees want more choice. Let's talk about what those options actually are. With healthcare costs today, I think it's important that we hone in on what's actually driving cost increase. The numbers in 2026 are significant. Employers, when surveyed about what they expect health care cost increases to look like for the calendar year 2026, the responses that have come back are roughly between 67%. Now that would mean that the cost per employee per month on average would reach roughly $18,000 I'm sorry, per employee per year on average would reach roughly $18,500 And that's again, according to recent industry reports. The really concerning part though, is that while employers are reporting between six and seven is what they're projecting, the actual costs increase that are that are being seen in the market today are closer to 10%. So six to 7% is a significant increase. That's what people are budgeting for. But the actual costs are exceeding that and hitting the double digits. And that's according to the International Foundation of Employee Benefit Plans, which is a nonprofit reporting organization that has 31,000 employer members. So it's a broad data set validating that employer expectations and actual cost increase are a little bit misaligned. So the question becomes what's actually driving this? And there's really three big factors. The first is catastrophic claims. So these are large, costly, expensive claim incidents episodes, things like cancer transplant services that are happening with greater frequency and greater cost exposure. The next thing are costly specialty drugs. So these are generally speaking injectable pharmaceutical products that treat expensive chronic and complex conditions. You can think of things like MS as an example. And then the third are the GLP-one injectable medications that you've been hearing about. So these are things like Ozempic, Wegovy. If you tuned into the Super Bowl last weekend, you certainly saw that there's a lot of advertising around these products, a lot of use of these products. And these products are incredibly effective, but they are also incredibly expensive and they are putting very significant cost pressure on benefit programs today. So what are employers doing to respond to this? The number one strategy that most employers start with is shifting cost or cost sharing. According to data that we have, 27% of employers are actually passing more costs to employees. They do this through a couple of different means. One would be increasing deductibles, co pays, things of that nature, making the plan itself a little bit watered down with the employee taking on more of that day to day cost when they go seek services. The other thing is premiums. So really shifting more of those costs increase in the premium back to the employees and more money comes out of the employee's paycheck. The employers that are pursuing this strategy, as we mentioned, 27% of employers are pursuing that as a strategy. That's up 6% from last year. So it's significant. More employers are shifting this burden because simply put, they're running out of other options. And so among the large employers, these are organizations with 500 or more employees. It's actually 51% have said that they are very likely to actually change their benefit plan design in some way that would encompass shifting costs back to employees. But because cost shifting can be very detrimental to the culture of an organization, it can also certainly create challenges in talent attraction and retention. It's important to know that cost shifting doesn't have to be the only strategy. Employers are also looking at a variety of other levers can be pulled. These are things that we work with our clients around. Some of those things would include conducting dependent eligibility audits. So these are looking at your population of enrolled dependents. These are spouses, children, and just making sure that you are covering dependents that are actually eligible. Other strategies include increasing deductibles, but pairing them with things like FSA, HRA or HSA, different spending accounts that can be used to help create some tax advantages for out of pocket costs. So while deductibles are going up, you're able to save money so that you can then use those dollars to pay for care as you need it. And 17% of employers today are doing this, which is up two percentage points from last year, more than 15% of employers were reporting this as a strategy. Other strategies that we're seeing out there that we are working with clients on that can be effective are implementing provider and purchasing initiatives. These would be things like telemedicine options, price transparency tools so that when your employees go to seek care, can know ahead of time what they're going to pay and select more cost effective options. And then also thinking about are there other network configurations? What hospitals, hospital systems can we direct care toward with the benefit plan for things that are a little bit more complex, like heart surgery, knee replacements, transplant procedures. Now, these strategies are gaining a lot of traction in the market. 17% of employers are using these strategies. That's up from 9% last year. So we're seeing real momentum there. But the thing that's important to note is that every one of these initiatives also increases complexity and administrative burden on the employer. So it's important that we pick and we select the options that make the most sense for you as an employer. The bottom line is healthcare costs are rising and it's happening very rapidly. And if we're not helping and if you aren't helping your business as an employer manage this through proactive strategy, you're going to end up either passing unsustainable costs on your employees or absorbing them yourselves, which is going to hurt the bottom line. Now, the good news in all of this is that there are smarter ways for us to respond to this and for us to work with you or you to work with your advisors to actually attack this cost equation in a thoughtful, focused, narrowly targeted way. That's exactly what we do to help our clients and what we are here to talk a little bit more about. So, that, hand back to Rob for another poll before we jump into some of those details. Perfect. Thank you, Alex. We had that one slide pop up quickly about new funding strategies. So we talked a lot about costs, and we talked a lot about the pressures and complexity. I would like to know from our audience, how familiar are you with different ways to fund your employee benefits packages? Alex talked about cost shifting, not ideal it sounds like. It sounds like there are other ways, I'm sure Alex is going be telling us, but there are other ways to fund your employee benefits packages. So who's familiar with? Are you very familiar with the different options available to you? Familiar? Are you somewhat familiar? They may be a little bit aware? Or is this is this all new and you're really hoping to gain a lot of information today about different, different techniques, different strategies you have to fund those benefits that are becoming more and more expensive all the time? And it looks like we're getting close to 50%. All right. Yes. Okay. I'm not terribly surprised, Alex. I myself am completely unfamiliar, with what you're going be talking about. And it looks like the bulk of our audience is in the unfamiliar or only somewhat familiar block there. Absolutely. So first and foremost, this doesn't surprise me either, Rob. What we find in the market today is that there are a lot of options and there needs to be more of an emphasis placed on getting those options into the hands of the employers that they can impact. And so I'm just really glad that we have an audience today that's tuned in to learn, because that's what we're here to do. And so I'm excited to talk a little bit about this. So for those of you that are unfamiliar or somewhat familiar, let's educate you. And so with that, let's jump into the next piece. So let's talk about the evolving funding models that exist in the market. So one of the biggest shifts that we're seeing in employee benefits is really fundamentally just how are benefits being billed and paid for? So traditionally, the way that we think about insurance is what we would call a fully insured plan. That's where you, as the employer, pay the insurance company a set premium that they have established based upon what they think your risk is going to be. And then they pay for the claims that you incur out of that premium. Now, if you exceed that cost through your premiums on risk, then the insurance company loses, so to speak. But if you overperform, if you do better, you're not getting money back. So you're paying that fixed cost no matter what. So that traditional fully insured program structure is what has been pervasive in the market for many, many years. But that's evolving. And so it's not just traditional fully insured plans anymore. There are new approaches that actually give you as an employer more control, more predictability, and potentially more savings. And so let's walk through what these funding structures look like and how are they gaining traction. So the first would be self funding. With self funding, the employer sets aside money to pay medical expenses as they occur. So you are taking on the risk of those claims yourself. Now, you might say, well, why would I do that? I don't know what my costs are going to be. We would work with you to help you establish a projection, understand what those costs look like, and really ensuring that we have a sense of what that risk could be so that we can smooth out those cost variances across the month. The other thing is that when you're self insured, you're not dealing with unfettered risk. We would put a product called stop loss on top that would actually insure you to a certain level. So, for example, if you have a claim that exceeds $25,000 we would put a stop loss program in and anything that exceeds that $25,000 you would actually have insurance that would pick up and reimburse those costs. But the advantage is that if you build the program this way, if you overperform, if you have lower cost than expected, that's capital that's right back into your business in that month. If you exceed that, then you have your stop loss program that picks it up. So some employers like this self insured program because it really allows you to absorb the good months as capital back into your business. Now, that being said, there's also some risk. When you're self insured, if you have a really bad claims month, even if you're getting that stop loss reimbursement, you got to have the cash to pay for it. It's not like fully insured where you have a predictable cost pulling out of your bank account every single month. So there's pros and cons, but this can give you some advantages in terms of realizing the good months in the month in which it occurs and in smoothing that cost out for your business. The next strategy is level funding. Level funding is really you can think of it as the middle ground between self insurance and that fully insured model that has existed traditionally. Level funding really takes the advantages of self funding where you are insuring that risk yourself, but then makes it feel like it's fully insured. So what you're doing is you're saying, here's the maximum risk exposure that you would have every single month based upon your stop loss program. And then you're building your premium off of that. So every month you pay the same amount of money, whether you have a good claims month or a bad claims month. Now, the advantage is, is that if at the end of the year you have had good claims, you've actually incurred less claims than premium, you get some money back. Whereas in fully insured, you do not. So that's the advantage of level funding. So if you are over performing, if you're doing great from a claims perspective, you can share in that savings, in that surplus, if you will. And if you don't, if you exceed your premium, you're still protected and you're not going to have additional money that you owe. So that's a great strategy. It's gaining a lot of traction in the market. Roughly 40% of employers today under 100 employees are actually looking at level funding very seriously or have moved to a level funded product. We're seeing a lot of that in our book of business. And that's something that really carries a lot of advantage. And then there's some emerging structures that are really starting to gain momentum. The first is what's called ICRA or individual coverage health reimbursement arrangement. This is a strategy that really takes the economic model of benefits and the choices that you offer to employees and they sort of uncouple it. So you can think of it as a defined contribution. As an employer, you will set up a monthly allowance. You will say, I can pay X amount of dollars to each employee to buy health insurance every month. At that point, you then give that money to the employee and the employee goes into the individual insurance market and actually buys the product that makes sense for them. So all you're really doing as the employer is playing the role of the funding mechanism. The insurance procurement piece lives with the employee. And so this gives employees the ability to have the choice to pick the product that makes sense for them. Well, you as an employer, you get to set your own budget. So imagine you could, instead of saying, I'm going to have to have my benefits budget be whatever the health insurance company says, you get to take that control back and say, I'm going to decide what my benefit budget is every single year and then give that money to my employees and let them pick what works for them. Now, if your employee picks a program that is more expensive than the budget you've given them, then they make up that difference with pretax contributions out of their paycheck. And if they go below that budget, then that's money you're not spending. You actually recoup that difference. So there's a lot of advantages to this structure. The other thing that we're seeing a lot of is employers that are just simply connecting individual health insurance offerings to their employees. So if you're a bit of a smaller employer, you have a couple of employees, you want help them buy insurance, but you don't wanna be in the business of offering your health plan, we can work with you and others can work with you to provide individual health insurance options that might fit that employee's needs and you simply help create a study for them as well. So the way you fund your health benefits directly impacts your cash flow, your budget predictability, and your ability to offer competitive coverage. The newer structures that we're talking about, as well as level funding and self funding, are really giving employers tools that they didn't have before to directly control these costs while still giving your employees access to great benefits with choice. So let's talk a little bit more about ICRA. So if you haven't heard of this before, we're going get into this a little bit more deeply. But the one thing that I want you to take away from this is that ICHRA today really represents the most flexible health care solution that the market has to offer. And so again, ICHRA stands for individual coverage health reimbursement arrangement. And so what does that actually mean? So instead of offering a traditional group health plan where everybody's going to get the same benefit plan, ICRA really allows you to give your employees the ability to buy what works for them. And so you're setting up that monthly allowance. Your employees then go and they procure the insurance that they need. Now, the great thing about the way that we approach ICRA is that we actually have the ability to support your client or your employees, rather, in selecting that coverage. So you're not just giving them money and then setting them loose into the market. We're actually going to help them pick a plan that helps make sense for them and their needs, the doctors that they need, the prescriptions that they need coverage for, and making sure that they're picking the right product. All you have to do is decide how much money do you want to spend on healthcare. And so what that really means is that you're providing maximum flexibility to your employees, but also to your budget. You can give different allowance amounts based upon employee class, full time versus part time, different locations, different departments, and you're not locked into that one size fits all strategy that traditional benefit programs have required. The other thing that I can't overstate enough is that you as the employer get to decide what your benefits budget is. So again, imagine that instead of next year, your benefits broker comes to you and says your rates are going to go up by 10%. We might have to look at other insurance offerings. We might have to look at cost shifting, all of the things that we've talked about. Instead, we say is you set up your benefits budget to offer X per month last year. What do you want to do this year? And I think the operative thing there is what do you want to do? What makes sense for your business as your choice? And so that level of cost control, predictability, sustainability, can't really be provided anywhere else, but ICRA affords you that. So no surprise premium increases at renewal, predictability, control, and clarity. And then the other thing I would say is that ICRA really is about simplicity. It eliminates the management of a traditional group health plan. You don't have to negotiate the renewals every year with your benefits broker. You don't have to deal with carrier restrictions on how many people can participate, how many people have to enroll to offer a certain offering, what state is your coverage being written out of. There's no more trying to find a plan that works for everybody in your population. You are playing the role of the economic provider, and really focusing in on how do I provide a budget for my employees in a solution to help them pick the solution, the coverage that they need. And that's ultimately what is all about. So really, as we think about ICHRA, from our perspective, it is the future of employee benefits. And so, and again, instead of selecting health plan and managing multiple solutions, you're just playing the role of funder. You're playing the role of the economic model. And so in an ICRA environment, summarize it, put a bow on it, you set a monthly benefits budget per employee. You access one ecosystem, for for your employees to to pick the individual products that they want, and you don't have to manage anything other than simply saying, this is how much money I wanna spend. The things that then you don't have to do is you don't have to pick the insurance plans. You don't have to negotiate the renewals. You don't have to manage multiple vendors. You don't have to deal with pricing, concessions every single year. And you don't have to manually handle enrollment, reimbursement, escalations, people lined up out at your door. If you're an HR professional asking questions about coverage, all of that is taken care of for you. So it is truly an ideal solution to provide you with flexibility, choice and administrative needs. And so let's talk a little bit more about, the individual health insurance as well, because it is continuing to play a larger role in benefit strategy today more so than it has in the past. And so again, you can think of this as really, if you think about ICRA, ICRA is an economic model where you're funding broadly contribution for every employee and then they buy individual insurance. If you think about just individual insurance on its own, it's essentially just helping employees find individual insurance that they want without the use of an ICRA. And so traditionally, we've seen individual insurance really work for self employed individuals, independent contractors, people that are working part time, people that are in job transitions, in between roles, basically anybody that doesn't have access to employer sponsored group health insurance. But today, employers are starting to use individual health insurance, particularly smaller employers, as a means to just help employees connect to a benefit program offering without having to be in the business of managing complex benefits on a group basis. And so really the idea here would be if you have a small number of employees and ICRA may not make a ton of sense for you, we can help your employees find individual insurance. If you want to set up some sort of reimbursement arrangement for them, that's something that we can help you do. And so many employers are discovering that instead of offering a traditional group health plan, whether it's individual health insurance or ICHRA, they can ultimately provide a really great benefits program for employees without all of the headaches and cost increases that they see in the traditional group health model. And so next, let's talk a little bit about ancillary benefits. So these would be things like dental, vision, life and disability benefits. While we put so much emphasis on the medical benefit program, which makes complete sense because one, we know that it's a table stakes offering for employees and two, the costs are increasing exponentially. We can't overstate the value of ancillary benefits as well, because these are the things that can be a differentiator for employers. And so let's talk a little bit about considerations here. So, the ancillary benefits ultimately carry a very significant impact. As I mentioned, they play a very big role when it comes to attracting and retaining employees. Again, we're talking about dental, vision, life, disability. These benefits ultimately, allow you to offer a well rounded program. Employees that come into an organization, they want to know what happens if something happens to me and I can't come to work. Am I going to have my income replaced with disability benefits? What's going to happen if something, heaven forbid, I pass away? Am I going to have money to provide for my family? Another more practical, you know, maybe a more immediate consideration is how do I make sure that my teeth stay healthy? How do I make sure if I need to get eyeglasses or I have a dependent child that needs to get braces? How do I make sure that I don't have to pay for that out of pocket? So these are the types of benefits that day to day from a practical perspective can be quite meaningful. And here's the really good news. Ancillary benefits can be offered pretty low cost and it can go a long way toward really rounding out that benefit account. And so as an employer, you can get quite a bit of bang for your buck here. These can just be viewed as strategic investments in your workforce. And so by offering these benefits, you're really building a benefits strategy that helps really from a human capital strategy perspective. Now, there's a couple of different ways to think about how to provide these benefits. One thing I would say is that funding of these benefits is also a consideration. So benefits in the ancillary space can be offered in one of two ways. One is called contributory, where you as the employer are contributing to part of the premium in much the same way you would think about what you're doing on the side of medical. Or we can offer them on a voluntary basis. And what that means is that you are giving every employee opportunity to enroll in these benefits at their own cost. But what that ultimately means is that they're still getting the benefit of offering it on a group basis, which means that the cost will be less than if they bought it on their own. And so within paychecks, we are offering a comprehensive range of these benefits, dental, vision, life, disability, financial protection solutions. These are things that we can offer to help really bring a more strategic aspect to your benefit offering. And the other thing I would say here is, you know, just to reiterate the point is that these benefits do actually matter. They aren't an afterthought. They really do strengthen that offering. They do go a long way toward building loyalty and satisfaction. They can be high impact and again, the investment can be quite reasonable. And so one of the things that we're very proud of here at Paychex is how we've built partnerships in this space. So, we have partnered with the best and top of the class partners in the dental, vision, life, disability space. These are partners that are brand name carriers that you would recognize. And some of the things that we're doing with those partnerships because of our size, our scale, our reputation in the market is we're actually able to give deals that no other benefits broker can give. We are able to save clients guaranteed cost off of their current offerings. So if you're offering these benefits today, we can actually guarantee you cost savings across any one of these benefits while offering the same benefit level. We can actually make that guarantee for two years. So we're the only ones in the market that are able to do this today. And really, again, it's about trying to provide a affordable way for employers to offer these as a strategic lever for their business while making sure that the benefits are strong and the cost makes sense. And so to go a little bit further here on just a quick client example, we had a client, we'll call them ABC Company, that had 65 employees and they were offering dental, vision, life, voluntary life and short term disability. Because we moved them to one of our preferred carrier partners and just the strategies and the negotiations that we've driven, we were able to save them almost $10,000 annually. And so that's money that's directly back into the business. Now that money can be used to invest in other parts of the benefit program, invest in other paycheck solutions, or invest in anywhere else in your business, or pass that savings back to your employees. So the point is, is that because we took a thoughtful approach and we leveraged our strength in the market with our client, we were able to bring that $10,000 of capital back into their business to do with what they wanted. And so quick plug here again on these partnerships, due to these exclusive relationships, I mentioned the cost savings that we can drive. To quantify that a bit for you, it's up to 10%. So we can save a guaranteed up to 10% on all ancillary products that you're currently offering, and bring that savings back into your business, and we can guarantee it for two years. So for anyone on this call that's interested, this is a guarantee that I will make to you right now here today that if you're offering these products today, we can guarantee up to 10% cost savings for two years. I'll be more than happy to help you do that. That's great Alex, thank you so much. A lot of great content there, I really appreciate all the topics you covered, you should take a drink of water there. We are going to do a quick poll here now, just to get a feeling for what improvements you anticipate making to your benefit strategy. I have to look at maybe the next six months or so. Are we looking at significant updates to better align with your priorities? Moderate updates, you're okay, you're just going to make some tweaks here and there. Not many, it's not a priority or you're just, frankly, you're unsure. And then while you people are entering your results in the poll here, your thoughts in the poll, I do want to note, this is a forty five minute event, but we will be staying later to handle some live Q and A. So if you want to hang on, please do. The live Q and A is always nice. A lot of questions did come in, and there's some good things, and Alex, I'm sure, has more information to give us. So let's see now how we're doing on the poll. The next six months, what improvements do you anticipate making as we have people enter their answers here? And let's see what we get. Alright. Everybody's gonna be making significant or at least moderate updates, Alex. And then okay. And then unsure. We're still evaluating. I think based on the calendar year, that makes a lot of sense. We know benefits tend to run on that annual that annual scope, but very interesting there, Alex. I'm going to hand it back to you now, take us through to the end. Sure thing. So not surprised to see that the feedback from the audience here today is that unsure, of exactly what the top priorities are. Some some things that we would encourage, is is that, you know, use this calendar year to really think strategically, and you can never do so early enough. You know, what are the funding models that could make sense for your business? How can you use those to build a benefit package that is really tailored to the needs of your workforce? And then what are the things you could do to enhance your benefit program offerings, whether that's ancillary benefits, creating more choice, administrative components that could become easier? So, our perspective is that it's never too early to start those conversations. And that's something that we work deeply with our clients around and something that we would encourage every employer on the call here today to make sure you're working with your advisor to to have those conversations early so that by the time the renewal hits, it's not a guess of what you're gonna do. You have a plan, and you can tweak that plan, but you have an approach that you're gonna be taking. And so I would emphasize here just as a plug for us in the way that we operate. You know, really for us, it's all about how do we unlock the value of a benefit program as not a cost burden, but actually a strategic lever for your business. We provide expert guidance across plans, funding models, compliance, ways of program structure. And I think again, to reiterate, we talked about it in the ancillary space. We have broad carrier access. We have deep relationships in the market. We have scale in the market that allows us to offer things on a preferred basis that's difficult to replicate other places. So, it's not just about the strategy we can bring to the table, but also, the advantages of those strategies from a carrier perspective, from a cost perspective, from an integration perspective. And again, I would be remiss if I didn't, you know, it's paychecks that we're talking about. If I didn't emphasize our technology and our service is really best in class, and it's all about creating simplicity for you, whether that's integrating your deductions into payroll, whether that's making the open enrollment process simple for you, whether that's removing the need for you to update ads, terms, changes into your benefit program. We are here to be that support infrastructure for you as well. So we want to build a better benefit plan for you. We want to help you make it more costly and we want it easier for you to administer. That's great, Alex. And I love that note that benefits are just part of that holistic solution that employers are delivering to their employees. So if you would like to speak with a Paychex benefits expert about improving that benefit strategy, from individual choices, from funding options, from ancillary benefits, to even figuring out how it blends into your total pet technology and service package. Go ahead and click yes here, and at no obligation, but an expert will follow-up with you, get a feeling for your business, your specific needs, your goals, and help you put together a plan that makes sense for your business today and going forward, of course. Great, great. So now, I'd like to get to Q and A. We had a few come in, and I want to let me just squeeze in here to find those questions. And let's see. So the first one we've got comes from Terry Gretzis, who wants to know if you need a minimum number of employees to do a self funded plan today with stop loss in it. So and that might apply in general, Alex. I'm curious about these various benefit plans and how does employee size come into play here? Yeah, no, it's a fantastic question. So so the short answer is yes. I think employee size is a variable here in two regards. One is that in general, for self insurance, we would not recommend employers with less than 100 employees in most cases to pursue self funding. And I say that for two reasons. One is that one of the ways that self insurance is underwritten is based upon claims data. In most markets across the country, if you have less than 100 employees, the insurance company, if you're fully insured today, isn't going to give you robust claims data. And so what that means is that to price the stop loss for you as a self insured employer is going to be deeply conservative. When an underwriter doesn't have a lot of information, they rely on conservatism. And so that makes some of the cost advantage of that structure a little bit eroded compared to what you would see if you had more robust data. So there's a practical matter there. The other piece of it, too, is that at that size, your risk isn't necessarily predictive. So there's not a large enough sample size to say we know what your risk is going to look like with some confidence going forward, which again leads to over conservatism in pricing. The other aspect of it, though, is that for some employers that are on the smaller end of that continuum, if you get into a place of volatility in your risk, you get into a place of pricing concerns, if you have a shock claimant that kind of unfortunately becomes a bit of a fiscal or a financial challenge for you rather. Going back into fully insured from becoming self insured, can be a bit of a challenging process. And the reason I say that is that if you're an underwriter at a health insurance company and you're underwriting a full insured program and you know that the client is self insured, the first question you ask is, what do they know that I don't? Right. So if they don't want to absorb their own risk, now they want us to. What does that mean? Well, that's going to mean that I'm either going to decline or I'm going to price this very unattractively because I'm hedging my bets a bit. And so it becomes a little bit of a matter of it's difficult to put the toothpaste back into the tube. And so that's why when we make that transition to self insurance, we have to be very, very thoughtful and very, very strategic about whether it's a good fit or not. The good news is, is that level funding is a great midpoint solution. And so with level funding, we do get a little bit more data. We do get a little bit more predictive value. And so what we would often recommend to clients that are interested in pursuing that self insured path is let's start with level funding. Let's get comfortable with that. Let's see how it performs, and then make that pivot again into the future as we continue to work together. The other area where employee size matters comes down to participation. So most group benefit plans will have a participation requirement if you don't meet those requirements and they vary carrier to carrier, then they would be more reluctant to offer a strategy for you. And in those cases, ICRA can be a great backup because there are no participation requirements with ICRA. That's excellent. I've got a lot of questions here, Alex, around ICHRAD. Thank you everybody who's staying on, for this Q and A. A lot of valuable stuff. And ICHRAD, they're absolutely new to me, for certain. So this one's from Christian Menoir, And then Terry has another question as a follow-up. Christian asks, with ICRA, are funds provided to employees considered taxable income? And then Terry wants to know, if we're giving funds to the employees, how do we control that they are actually being used towards the health care plan? Just that employee dynamic and what is happening Totally. Fantastic questions. Really appreciate both of them. So the first thing is that yes, one of the great things about ICRA is that the tax advantages of having a group health plan, which is the pre tax contributions, etcetera, that all flows through to ICRA as well. And so, that is something that if you were to partner with us for an ICRA, our ICRA platform that we partner with is integrated into the payroll ecosystem. So everything comes up pretax, the deduction management exists. So, all of that functions in the same way. Now, to your question about how do we make sure that the employees are using the dollars for that purpose? That's where our partner comes in. So, the dollars flow through ICRA platform partner and those dollars only get spent by the employee on the purchase of a healthcare product. Otherwise, those dollars aren't actually flowing to employee directly. So, the employee is not getting a check from you and then running off and cashing it for whatever purpose. It is actually funneling through to ensure that it's actually being used for a healthcare product. And if it's not, then those dollars don't flow or accrue to the employee and they don't come out of your bank account. Excellent. That makes perfect sense. And then I've got a couple more questions, one from Manisha and one from Jennifer. And this relates to the kind of plans I can choose as an employee if the employer is going the ICHRA route. Manisha wants to know what group plan choices do employees have. Is it just the marketplace? And Jennifer's asking, do they just select from plans that they already have through paychecks, the group plans that they already have and the employees get to choose through this. How does that work in terms of what the employees choose to do with those ICRA funds? Absolutely. So, again, a great fantastic question. So, the employee would have access to the individual health insurance market in the state in which they reside. So for example, if they're in the state of Ohio, I'm just using that as an example, they would have access to all the major carriers nationally, as well as in Ohio. So the mutuals of the world, Blue Cross Blue Shield, Anthem, Cigna, UnitedHealthcare, Aetna. And so they would have access to that robust ecosystem of individual products. So it's not limited for the employer to select what those products are, what carriers you want to offer. One of the ideas around APRA is to pull actually you as the employer out of having to make those decisions and really just play the role of providing that funding model. And so, our partner on the ICRA side from a platform perspective has all of the infrastructure built to allow that that shopping experience to happen at the employee level with all of the carriers in the state in which they reside, and to actually create a digital experience, but they also have a a person led experience as well. So if they want to speak to a rep, we want to help support the member in answering questions, thinking about what options are best for them. All of that support infrastructure is there. And so it really provides a robust experience that actually feels like buying a group health plan, but it has the flexibility and the nimbleness and choice of an Incra. That's great. That's great, Alex. Okay, I've got a I'm going to have one last question here. This is from Jeff, who wants to plan better, become more proactive. So I'm not surprised by benefits, updates, changes, etcetera. And you touched on, Alex, price is only going up, the complexity are going up. How does Jeff get ahead of this and plan ahead for this? So from our perspective, it really comes down to your partner. And so as a benefits broker ourselves here at Paychex, what I work on every single day with my teams are making sure we are always in front of our clients in two regards. One is we want to make sure that if something's changing in the health care landscape, there's a new product, there's a new regulation. You're hearing about it from us proactively. And then the second thing is we want to make sure that we have a strategy for your renewal before your renewal is in hand. So historically, lot of benefits brokers, ourselves included in the past, have taken the approach of we'll decide what we're doing once we have your renewal. But that's really too late. What we believe is that if ICRA sounds like it's a good strategy or if level funding sounds like a good strategy, even if you don't renew until October, we should decide that now because that gives us a lot of time to know who should we be talking to, what education should we be doing to make sure that you are completely comfortable with this very important decision that you make. And so that gives us the opportunity to evaluate all of that, feel very comfortable with that process. And then the great thing is, is that if we get to your renewal and your carrier comes back and gives you a rate that you think is favorable, you might say, you know what, this year, let's just go with things as they are. But now I'm better equipped next year to know what else I need to look at. And that's a win regardless. And so it's really about being proactive, being consultative, making sure that you have an advisor that's bringing you through that process, even if it's not for this year, just so you can make an informed decision at every step along the way. I love it. Tremendous, tremendous information, Alex. Thank you so much for joining us today and sharing all this great information with our audience. And for our audience, thank you again for joining us today for affordable healthcare solutions for every business. No matter where you are in the business lifecycle, the Paychecks Insurance Agency is here to help you with guidance, tools, and partnerships to help make benefits simple and, as Alex noted, strategic. So as a reminder, you can access a printable copy of the presentation deck in the files and resources window on your console, along with a health and benefits guide, high off the presses. We'll also be sending a follow-up email with a recording of the event in case you want to listen to it again or share it with others who might be interested in this great information. Finally, if you can spare a few moments as we close, we welcome your feedback on a brief survey that will pop up. Your response helps us improve future resources like this to support your business. Thanks again, and I hope everyone has a great day.