Request a call Login

  • In an era marked by unprecedented health care challenges and changes, one issue that has been steadily making headlines is the rise in prescription drug costs. Employers, in particular, are feeling the financial pinch as they grapple with the ever-increasing expenses associated with providing prescription drug benefits to their employees. Recent data indicates that the median annual price of new drugs surged from $180,000 in 2021 to a staggering $222,000 in 2022, marking a 23% increase. In addition, the costs of existing drugs also saw a significant spike of more than 25% in just one year.

    Despite these statistics, there’s hope on the horizon. Employers can adopt innovative strategies to effectively manage prescription drug costs while ensuring that their employees receive the medications they need. If you’re a small business owner, continue reading to explore ways to navigate this challenging trend and make informed decisions to protect your employees’ health and bottom line.

    Leverage Technology

    One of the fundamental steps in controlling prescription drug costs begins with employees. Even the most well-designed prescription drug plans can’t deliver on their promise if employees don’t fully understand them or don’t adhere to prescribed drug regimens. Educating employees about their coverage and available alternatives is essential. Employers can utilize apps and technology to provide alerts and prompts when drug prices rise, allowing for discussions for more cost-effective alternatives with health care providers. In addition, monitoring and improving adherence to care plans and drug therapy requirements is crucial, as non-compliance not only drives up costs but also poses a threat to employees’ health.

    Carefully Manage Plans

    Employers, especially those with self-funded health benefits, have opportunities to manage costs more effectively. They can negotiate contracts, define drug formularies, and seek ways to maximize rebates from drug manufacturers. Smaller and fully insured employers should work closely with health insurance carriers to manage formularies and tighten authorization requirements, ensuring that only those needing specific drugs can access them. Employers should consider steering patients toward biosimilar and generic drugs when clinically appropriate, always weighing the net cost and the best clinical choice for the patient.

    Select The Right Partners

    Selecting the right partners in the management of prescription drug benefits is paramount. Employers should ensure that their partners’ priorities align with their goals. For instance, an insurer offering a fully insured prescription drug plan to a smaller employer will focus on controlling formulary costs. Employers must also prioritize efficient prior authorization processes, ensuring they don’t disrupt patients’ clinical care and treatment timelines. In today’s evolving landscape, employers have the opportunity to partner with third parties, such as professional employer organizations (PEOs), to assist with these rising costs.

    The Help Of A PEO

    In the current economic climate, businesses face an uphill battle with ever-increasing expenses. From the mounting health care and prescription medication costs, entrepreneurs and business owners are navigating a complex financial landscape. However, there’s a solution that can offer significant assistance in tackling these challenges – GMS, a professional employer organization (PEO). GMS comes equipped with Rx Specialists who can provide invaluable guidance in optimizing health care plans, controlling prescription drug costs, and ultimately reducing the financial strain on business owners.

    Christine Rohrer, GMS’ Rx Coordinator, added, “To help with the rising cost of medications, Rx Coordinators at GMS will provide support for members who need additional help accessing medications that may have a high copay, require a patient assistance, and/or are excluded such as specialty medications. If needed, the Rx team will look at the members’ diagnosis to discuss treatment options with providers. We also investigate and research future drug trends, search for medications that are covered through medical, and/or discuss switching medications to a covered, cheaper alternative that is on our formulary. We will look through every available option and take on a hands-on approach to ensure our members have access to life-changing medications.”

    By partnering with GMS, business owners can not only ease the burden of rising expenses but also direct their energy towards the core goal of their business: growth and success. In times of financial uncertainty, PEOs can be the sturdy bridge that supports your business. Contact our HR experts today.

  • The constant climb of health care expenses in the United States is causing increasing concern, particularly as inflation continues to impact the nation. The Nationwide Retirement Institute Health Care Cost in Retirement recently released a survey that paints a worrying picture of Americans’ financial confidence as they approach their retirement years.

    Decreasing Confidence In Facing Health Care Costs

    The survey shows Americans’ doubts about their ability to manage health care expenses as they grow older. 59% of respondents express uncertainty about their capacity to meet these financial burdens, and 57% are anxious about the costs associated with caregiving for their partner or spouse.

    Further complicating financial planning is the anticipation of medical advancements driven by artificial intelligence (AI), which could potentially extend lifespans. 26% of respondents expect AI to grant them an additional 10 years of life, with different generational expectations. Gen Z envisions 15-year extensions, while millennials anticipate 12 years, Gen Zers expect eight years, and boomers foresee a 9-year extension. This implies that Americans may need to financially prepare for health care costs over a more extended period, emphasizing the need for a robust financial strategy.

    Kristi Rodriguez, Senior Vice President of the Nationwide Retirement Institute, noted, “Advances in AI and health care technology are moving at an unprecedented pace, offering hope for treating chronic diseases and other health concerns. However, longevity demands enhanced planning. Therefore, it’s vital to consult a financial professional to devise a comprehensive plan that caters to immediate and potentially extended health care needs.”

    Managing Health Care Expenses

    As Americans grapple with the prospect of an extended lifespan, current economic uncertainty is straining their finances and forcing them to make difficult decisions with long-term implications for their health care. Studies show that 18% of adults admit to delaying essential health care actions such as medical procedures, physical exams, or prescription renewals in the past year to save money. In addition, 10% of Americans are contemplating downgrading their health insurance plans due to high inflation, including 19% of Gen Z, 11% of millennials, and 14% of Gen Xers. In their quest for more manageable monthly premiums, 60% of adults opt for health insurance policies with lower premiums but higher deductibles, potentially leaving them unprepared to cover unexpected out-of-pocket health care expenses.

    The Role Of Financial Professionals In Health Care Planning

    With inflation and soaring health care costs causing widespread anxiety, consulting a financial professional is the most vital step individuals and business owners can take. These experts can help tailor financial plans to ensure people are well-prepared for the rising health care expenses without compromising their overall financial stability.

    Conversations with financial professionals are pivotal, particularly in understanding complex issues such as Medicare coverage. The survey underscores a substantial knowledge gap among respondents, with 72% expressing a desire for a deeper understanding of Medicare.

    In addition, Americans significantly underestimate the average cost of health care in retirement, estimating it at $55,343, while the actual 2022 cost stood at nearly triple that figure: $172,500 for an individual and $315,000 for a typical 65-year-old retired couple. This highlights the need for Americans to seek greater knowledge, guidance, and ongoing support for informed financial planning.

    Nationwide’s Health Care Cost Assessment tool is an invaluable resource that helps financial professionals and clients estimate future medical and long-term care expenses by considering individual health risks and facilitating comprehensive planning for the impending rise in health care costs.

    Have You Considered Partnering With A PEO?

    In the face of mounting health care costs and economic uncertainties, it’s clear that thoughtful financial planning is essential for safeguarding our well-being. Financial professionals, like those found within a professional employer organization (PEO), are pivotal in guiding us through these complex financial landscapes. They offer tailored solutions to bridge the gap between our goals and financial reality. By consulting with a PEO like GMS, business owners can pave the way for a secure, confident future, free from unmanageable health care expenses. Remember, preparation is the key to not just surviving but thriving in the ever-evolving world of health care and finances. Contact us today to learn more.

  • In a world where financial security and retirement planning are hot-button topics, the recent announcement by the Social Security Administration brings a breath of fresh air. On October 12th, 2023, the administration revealed that Social Security benefits will increase by 3.2% in 2024, offering much-needed relief to millions of beneficiaries. A beneficiary is a person or entity designated to receive the benefits of property owned by someone else. This annual cost-of-living adjustment (COLA) is a promising step toward helping retirees maintain their financial footing amidst inflation.

    Moderating Inflation And 2024 COLA

    The 3.2% increase projected for 2024 might appear modest compared to the impressive 8.7 percent jump in 2023 or the 5.9 percent boost in 2022. However, it’s important to recognize that this change is not in isolation but rather a reflection of moderating inflation. The COLA announcement closely follows the release of the latest Consumer Price Index (CPI) report, which found that inflation has increased year-over-year. While inflation remains relatively high, it’s notably lower than the 40-year high of 9.1% experienced last June.

    What This Means

    The increase in Social Security benefits is expected to impact the lives of 66 million beneficiaries. On average, Social Security retirement benefits will rise by approximately $50 per month, effective in January 2024. The average monthly retirement benefit for workers will increase from $1,848 to $1,907. However, 7.5 million Supplemental Security Income (SSI) beneficiaries will witness the increase in their December checks. This is particularly beneficial for those who rely on Social Security and SSI benefits, offering immediate relief to their cost of living.

    Wage Cap For 2024

    The Social Security Administration also announced the 2024 wage cap. The maximum amount of earnings subject to the Social Security tax, also known as the taxable maximum, will rise to $168,600, marking a 5% increase from the previous year’s cap of $160,200. This adjustment is crucial as it ensures that the tax base keeps pace with the growth in earnings and cost of living.

    Impact On Retirees And Beyond

    The importance of this annual benefit adjustment cannot be understated, especially in the context of an aging population and rising living costs. Retirees can now breathe a little easier knowing they will soon receive an increase in their Social Security checks to combat the rising prices. Older Americans, who have been feeling the pinch when buying groceries and paying for gas, can now look forward to a bit of financial relief.

    Partner With GMS!

    In a world where the financial landscape is ever-shifting, a crucial player takes center stage – a professional employer organization (PEO). Think of it as a strategic partner, working behind the scenes to ensure that businesses can seamlessly extend the benefits of Social Security to their employees. PEOs like GMS serve as a partner, navigating the intricate web of payroll management, tax compliance, and regulatory complexities, empowering businesses to optimize the benefits offered to their workforce. In a world where every dollar carries profound significance, GMS becomes the key player that connects businesses and their employees to financial stability. Contact us today to learn more.

  • In a world marked by economic uncertainties, small business owners need to be attuned to their employees’ concerns and needs more than ever. As you gear up for the 2023 benefits open enrollment season, Voya Financial, a retirement, investment, and insurance company, released its consumer research survey, unveiling crucial insights that can empower you to make informed decisions.

    Inflation Concerns: A Growing Worry

    The shadow of inflation continues to loom over working Americans across the nation. Voya’s research highlights that 79% of working Americans are apprehensive that their workplace benefits will become more expensive during this open enrollment season due to inflation. This represents a significant increase from the 66% recorded in June of 2022 when inflation was at its peak.

    As a small business owner, this rise in inflation-related concerns should serve as a call to action. It’s time to consider benefits packages that help your employees navigate the financial strain caused by inflation, ensuring that their hard-earned money goes further.

    The Intersection Of Finances And Mental Health

    Voya’s research underscores the deep connection between financial stability and mental well-being. 57% of Americans surveyed agree that financial stability directly impacts their mental health. This revelation places mental health at the forefront of your employees’ concerns, particularly as they approach this year’s open enrollment season.

    In addition, the modern workforce is increasingly vocal about their expectations regarding mental health support. 55% of employed individuals believe that their employer is responsible for ensuring their mental and emotional well-being. This sentiment becomes even more apparent when 48% express their willingness to invest more in workplace benefits that offer enhanced mental health support and resources.

    Crafting Comprehensive Benefits Packages

    Traditional benefits such as medical and dental vision remain essential; however, Voya’s research illuminates the importance of evolving your benefits package. Your employees now expect a holistic approach that addresses financial and mental health needs. Employees are willing to commit to employers who offer mental health benefits, with half of employed Americans indicating they’re more likely to stay with their current employer if these resources are available.

    One positive development observed in today’s environment is that employees are becoming more thoughtful about their benefit selections, given the overarching financial concerns. 79% of employed individuals express interest in receiving support to maximize their workplace benefit dollars across retirement savings, health savings accounts (HSAs), health care insurance, and voluntary benefits.

    Prioritizing Financial And Mental Well-Being

    As you prepare for the 2023 benefits open enrollment season, you must address the concerns related to inflation, by offering comprehensive benefits that encompass financial and mental health needs. At GMS, a professional employer organization (PEO), we understand that the well-being of your employees is paramount, which is why we offer a comprehensive range of solutions to address your business needs. From employee assistance programs (EAPs) that provide crucial mental health support to a wide array of voluntary benefits and personalized guidance, we ensure that your workforce can make the most informed choices during open enrollment. With our expertise and commitment to your employees’ financial and mental well-being, we help your small business thrive while prioritizing what matters most – the health and happiness of your employees.

    Kristy Rittenour, GMS’ Benefits Account Specialist Manager, expressed, “Every year, GMS partners with our clients to enhance or change their benefit offerings, helping them recruit and maintain top talent. Based on mid-year utilization reporting, group size, and unique needs, GMS prepares the client in advance for their benefits renewal. An early evaluation of this information removes the guesswork and is critical to successful open enrollment.

    Contact us today to prepare yourself for the open enrollment season.

  • In a welcome development for both plan sponsors and employees, the retirement landscape in the United States has recently witnessed a significant shift. The Internal Revenue Service (IRS) announced a game-changing extension, granting an additional two years for compliance with a pivotal provision under the SECURE 2.0 Act. This transformative legislation, passed in December 2022, introduced a series of changes aimed at reshaping the retirement savings landscape. One of its cornerstones, the Roth catch-up contribution requirement, was initially scheduled to go into effect on January 1st, 2024, impacting workers earning $145,000 or more annually. However, due to the complexities and challenges of implementation, this requirement has now been deferred until 2026.

    The SECURE 2.0 Act

    The SECURE 2.0 Act, short for “Setting Every Community Up for Retirement Enhancement,” represents a landmark legislation seeking to revolutionize how Americans approach retirement savings. At the heart of this Act is the provision requiring high-income workers earning $145,000 or more per year to divert their catch-up contributions to Roth accounts within their employer-sponsored retirement plans, such as 401(k)s. Originally scheduled to take effect in 2024, this provision stirred both anticipation and hesitation within the financial and retirement planning sectors.

    IRS Extends The Compliance Deadline

    Recognizing the legitimate concerns voiced by taxpayers, the IRS has taken a strategic step to extend the compliance deadline for this crucial provision. IRS Notice 2023-62 stipulates that the Department of the Treasury and the IRS have noted the challenges faced by taxpayers in promptly adhering to the new requirement. As a result, an administrative transition period has been implemented, allowing for a smoother and more orderly shift toward compliance. The extension, which pushes the deadline to 2026, affords employers, plan providers, and employees ample time to adapt to the changes and ensure a seamless transition.

    A Win-Win For All Parties Involved

    Extending the Roth catch-up contribution requirement presents a win-win scenario for plan sponsors and employees. Employers and plan providers who faced the daunting prospect of establishing new Roth plans within a tight timeframe can now breathe a sigh of relief. The extra time will enable them to plan and execute the necessary administrative and procedural adjustments without compromising on the quality of implementation. In addition, employees who fall into the high-income bracket will benefit from a more gradual and planned transition, reducing the potential for financial disruptions during the adjustment period.

    The Path Forward

    This extension underscores the government’s commitment to fostering a retirement landscape that is fair, flexible, and conducive to the financial well-being of all citizens. The additional time granted will undoubtedly pave the way for a smoother transition, allowing plan sponsors and employees to navigate the changes confidently and clearly. As we move toward 2026, the horizon of retirement savings stands poised for transformation, offering new opportunities and fresh pathways toward a secure and prosperous retirement future.

    Embracing Change With Confidence – How A PEO Can Be Your Strategic Partner

    As the retirement landscape evolves and the extended deadline for the Roth catch-up contribution requirement approaches in 2026, businesses find themselves at a crossroads of adaptation. Navigating the intricacies of compliance, administrative adjustments, and employee communication demands a holistic approach that aligns with your business’s unique needs. This is where a professional employer organization (PEO) like Group Management Services (GMS) steps in as your strategic partner.

    With expertise in HR, benefits administration, and compliance, a PEO can help you seamlessly transition into the new retirement model. GMS ensures a smooth and successful implementation by guiding you through the technical intricacies of establishing Roth plans to communicate changes to your employees effectively. As you prepare to embrace future opportunities, a PEO empowers your business with the resources, knowledge, and support needed to thrive in an ever-changing landscape.

    Tom Smith, GMS’ Director of Retirement Services, expressed, “Although the deadline for the Roth catch-up contribution deadline has been extended, there are still other provisions that the Secure Act 2.0 requires to be in place starting in 2024 and 2025. A benefit of working with the GMS Multiple Employer Plan is that we ensure your plan complies with the new rules and regulations. We’re also a resource to discuss and answer questions regarding the optional provisions a company may want to implement.”

    Together, we can ensure that your business and your employees are well-equipped to embark on this transformative journey toward a secure and prosperous future in retirement. Contact us today to learn more!

  • In an inspiring move towards enhancing employee rights and creating compassionate workplaces, Illinois has taken a significant step by amending the Victims’ Economic Security and Safety Act (VESSA). This change, signed into law by Governor J.B. Pritzker on July 28th, 2023, brings about a crucial expansion in the leave available to employees dealing with the aftermath of a family member’s death due to a crime of violence. The amendments to VESSA took effect immediately, signaling a state committed to supporting the well-being of its citizens in times of extreme hardship.

    Comprehensive Coverage

    Under the original VESSA, Illinois employers were required to provide unpaid leave to employees who were victims of domestic, sexual, or gender violence and crimes of violence. This encompassed not only the victims themselves but also their affected family or household members. This coverage highlighted the state’s dedication to fostering safety and security within its workplaces and communities.

    Amendments: A Deeper Level Of Compassion

    The newly introduced amendments further illustrate Illinois’ commitment to empathy and support for its residents. Before these changes, employees were eligible for leave for specific reasons, including medical attention, counseling services, victim services, legal assistance, and safety planning. However, a crucial layer of support has been added with the amendments.

    Now, employees are granted leave for more intimate and sensitive reasons, including the following: 

    1. Attending funerals or wakes: Employees can now take time off to attend the funeral or alternative memorial arrangements of a family or household member who was a victim of a crime of violence. 
    2. Arrangements due to death: Recognizing the responsibilities that arise from a family member’s passing, the amendments permit employees to take leave to make necessary arrangements after a crime of violence-related death. This acknowledges the logistical challenges that families face in such difficult times. 
    3. Grieving process: Perhaps the most poignant aspect is acknowledging the grieving process. Employees are now entitled to leave time specifically to grieve the loss of a family or household member who was killed in a crime of violence. This change reflects the understanding that mourning is an essential part of healing. 

    Balancing Work And Healing 

    The amendments take into account the size of the employer. The duration of leave varies based on the number of employees in the organization. While this allows for flexibility, it also provides that businesses, particularly smaller ones, can manage operations effectively.

    The amount of VESSA leave an employee is entitled to depend on the size of the employer as follows:

    • An employee working for an employer with up to 14 employees is entitled to four work weeks of leave during any 12-month period. 
    • Employees working for an employer with at least 15, but not more than 49, are entitled to a total of eight work weeks of leave during any 12-month period. 
    • An employee working for an employer with at least 50 employees is entitled to 12 work weeks of leave during and 12-month period. 

    Moreover, the amendments acknowledge that certain situations require a more immediate response. If an employee needs to take leave for the newly added reasons related to crimes of violence, they are entitled to a shorter period of unpaid leave. This enables them to attend to the immediate aftermath without compromising their jobs or financial stability.

    In Sync With Existing Laws

    Conscious of the interplay between employees’ protection laws, it’s essential to understand the need for synergy across various regulations to safeguard workers’ rights. A prominent example is the Illinois Family Bereavement Leave Act (FBLA), which establishes a distinct framework for bereavement leave. Under FBLA, qualified employees are eligible for up to two weeks of unpaid leave following the death of an immediate family member. Notably, the provision extends up to six weeks of leave in the event of the death of more than one covered family member within 12 months. The key distinction lies in eligibility criteria: FBLA covers only employees qualified for federal Family and Medical Leave Act (FMLA) benefits, whereas the scope of VESSA encompasses all Illinois employees, accentuating the state’s commitment to protection for all.

    However, the amendments do not lead to overlapping entitlements. Instead, they complement each other effectively. If an employee is eligible for FBLA leave, the amended VESSA does not provide additional bereavement leave beyond what is already granted. This ensures a fair distribution of leave entitlements.

    Unlocking Support For Small Business Owners

    In the dynamic landscape of Illinois’ evolving employment laws, small business owners face the dual challenge of maintaining compliance while nurturing their ventures. As the recent amendments to the Illinois VESSA exemplify, the legal landscape can shift rapidly, requiring business owners to remain compliant and informed. This is where a professional employer organization (PEO) can help business owners in Illinois. By partnering with a PEO like GMS, business owners can access HR experts who keep you compliant with employment regulations.

    With our comprehensive services, including HR support, benefits administration, payroll, and risk management, small businesses can confidently navigate employment laws’ complexities. Contact us today to learn how we can empower your business to thrive in evolving regulations.

  • In a critical step towards addressing the ongoing mental health crisis in the United States, the Biden administration has proposed new rules to ensure equal access to mental health and substance misuse treatment. The rules, introduced by the Health and Human Services, Labor, and Treasury departments, will push insurers to comply with the Mental Health Parity and Addiction Act (MHPAEA), a landmark legislation enacted in 2008. This act mandates that insurance plans offer the same level of coverage for mental health and substance misuse care as they do for physical medical treatments.

    However, the administration has recognized that many insurers are not adequately complying with the law, leading to limited access to essential mental health care services. In this blog, we will explore the significance of the proposed rules and their potential to positively impact the lives of millions of Americans facing mental health challenges.

    Breaking Down The Mental Health Parity And Addiction Equity Act

    The MHPAEA was designed to address the historical disparities in health care coverage between mental health and physical medical treatments. This legislation aims to end the discriminatory practices that have hindered mental health and substance misuse care for far too long. By prohibiting private health insurance companies from imposing more restrictive copayments, prior authorizations, or other requirements on mental health and substance misuse care benefits, the act seeks to level the playing field for those in need of these mental health services.

    Recognizing The Mental Health Crisis In America

    In recent years, the United States has witnessed a significant decline in mental health. Factors such as the COVID-19 pandemic, financial stress, inflation, and increased workloads have contributed to rising rates of depression, anxiety, and stress.

    Sadly, many individuals find it challenging to access professional help to address their mental health concerns. Studies show that nearly one in three Americans who need mental health care are unable to receive it, highlighting the urgency of addressing this crisis.

    The Implications Of Non-Compliance

    Despite the existence of the MHPAEA for over a decade, many insurance providers have not fully complied with the law. This lack of compliance has resulted in disparities in access to mental health care, with some individuals facing greater obstacles than others when seeking treatment. These disparities perpetuate the stigma surrounding mental health and can exacerbate the challenges faced by those already struggling with mental health issues.

    The Biden Administration’s Bold Move

    Recognizing the urgency of the situation, the Biden administration’s proposal aims to strengthen enforcement of the MHPAEA. By providing clearer guidance to insurance plans and issuers, the administration seeks to ensure that mental health and substance misuse care receive the same level of coverage as other medical treatments. This move could significantly improve access to mental health services for millions of Americans, potentially saving lives and fostering a healthier society.

    The Path Forward

    The proposed rule is not a final step but rather a crucial milestone in the journey toward achieving true mental health parity. As the rule will be open for public comment for 60 days, it presents an opportunity for concerned citizens, mental health advocates, health care professionals, and stakeholders to contribute their insights and suggestions. By actively engaging in this process, the collective voice can further shape and strengthen the proposed rules, maximizing their impact in bridging the gap between mental health and physical health care.

    Mental Health Matters: Unveiling The PEO Solution For Small Businesses

    To cultivate a workplace that values and prioritizes mental well-being, small businesses have a valuable resource: a professional employer organization (PEO). By forming a partnership with a reputable PEO like GMS, small businesses can tap into a wealth of expertise and resources uniquely tailored to address mental health challenges within their workforce. These organizations can play a pivotal role in bridging the gap between physical and mental health care by providing access to comprehensive employee assistance programs (EAPs) and mental health benefits.

    With GMS’ support, small businesses can foster an environment of understanding and empathy, promoting a culture that encourages open conversations about mental health. This collaborative effort empowers employees to seek the necessary help and support, leading to a more resilient, engaged, and productive workforce. Together, as businesses embrace this transformative approach to mental health, they can build a brighter, healthier, and more harmonious future for their employees and the entire organization. Interested in learning more? Contact us today!

  • The impact of inflation extends beyond immediate price increases and into long-term, far-reaching consequences for individuals and families. The current surge in inflation rates, particularly in the wake of the COVID-19 pandemic, has created financial strains and challenges that may not be apparent yet.

    What Is Inflation?

    Inflation is the rate at which the cost of a good or service increases. The cost of food, housing, gasoline, utilities, and other goods have skyrocketed by 7.7% over the past 12 months – nearly a 40-year-high. Rising inflation rates directly affect the purchasing power of individuals and families. As the cost of goods and services increases, it becomes more difficult for households to maintain their standard of living. This can lead to reduced discretionary spending, limited savings, and a need to prioritize basic necessities over other financial goals or aspirations.

    While inflation is hitting almost everyone, low-income households are experiencing a harsher impact than others as employee wage increases fail to keep up with inflation. This has forced families to shift their budgets to cover the necessities to survive during these challenging times.

    Cutting Back On Retirement Savings

    Inflation’s economic influence is so strong that it doesn’t stop at budget adjustments; it also affects Americans’ retirement savings habits. With the rising cost of living, individuals and families find it increasingly difficult to allocate funds toward retirement savings. A recent survey found that half of U.S. adults saving for retirement had to pause their saving efforts in 2022 because of inflation. On top of that, 32% withdrew from their retirement savings, and 41% indicated they stopped contributing to their retirement funds altogether. The strain on household budgets due to inflation is providing a real challenge to set aside money for long-term financial goals.

    For those already nearing retirement, the increased cost of living poses a significant threat to their retirement savings. Higher prices for essential goods and services can erode the purchasing power of their retirement funds, potentially requiring them to adjust their retirement plans or dip into their savings sooner than anticipated. Furthermore, individuals still in the earlier stages of their careers may face difficulties prioritizing retirement savings amidst the current inflationary environment. When faced with higher costs for daily necessities, there may be less available income to contribute to retirement accounts or invest in long-term financial vehicles.

    While inflation may appear to be slightly winding down, it’s not going away anytime soon. Kelly LaVigne, VP of Consumer Insights, Allianz Life, expressed, “While we all hope that the pace of inflation will slow, it will take time to moderate. Consumers need to prepare themselves by talking to a financial professional and incorporating ways to help fight the effects of inflation into their portfolio so that long-term inflation doesn’t affect retirement.”

    Tom Smith, Director of Retirement Services at GMS, stated, “With inflation increasing and the cost of living rising, it’s essential you are saving in your 401(k), especially if your company offers an employer match. You’re leaving free money on the table if you stop contributing altogether. If you’ve exhausted all options for cutting back on spending and are still looking to dial back your deferral amount, try and take full advantage of the employer match. This means if you’re contributing eight percent right now, but the match requires you to contribute at least five percent, don’t decrease your contribution to less than five percent. If you want to retire at some point, you need to have a variety of sources to draw income. It’s important to pay yourself first, and a 401(k) is a great option to do that with convenient payroll deductions and tax advantages.”

    How Can You Step In As An Employer 

    As we all remain concerned about the economy and how it could affect us, it’s essential as a business owner to ensure you take every step to help your employees. Offering a retirement plan is a great way to provide long-term financial security and demonstrate a commitment to their future. By providing a plan, you empower employees to save for retirement and establish a foundation for their financial stability.

    Matching program

    Furthermore, implementing an employee matching program can significantly enhance the attractiveness of your business’s retirement plan. By matching contributions, employers contribute a percentage or dollar amount corresponding to the employee’s contributions. This approach not only motivates employees to save more for retirement but also amplifies the growth of their retirement savings over time.
    Plus, matching programs have several advantages for your business. Firstly, they help attract top talent by positioning your company as one that values employees’ financial well-being. It differentiates your business from competitors and becomes a valuable tool in recruitment efforts. Additionally, these programs contribute to higher employee retention rates, as employees are more likely to stay with a company that offers robust retirement benefits.

    Retention bonuses

    Retention bonuses refer to a one-time payment or reward given to an employee apart from their regular salary. This is given as an incentive to keep a valuable employee in their job, and it can be an effective strategy to help reduce the financial impact of inflation on employees. These bonuses are typically reserved for employees who have been with the company for a specific period, incentivizing them to remain loyal and committed. By offering retention bonuses, you can provide financial relief to employees without directly increasing their base pay.

    This approach allows you to address the challenges posed by inflation while maintaining flexibility in their overall compensation structure. There are various ways to structure retention bonuses. For example, they can be a one-time lump sum payment or distributed over a defined period. The bonus amount can factor in tenure, job level, or performance metrics.

    Financial education and planning

    Additionally, you can offer financial education and planning resources. Financial education programs can cover various topics, including budgeting, saving strategies, debt management, investment basics, and retirement planning. These programs can include workshops, seminars, online courses, or one-on-one sessions with financial experts. Equipping employees with the knowledge and skills to make sound financial choices can positively contribute to your employees’ economic resilience and stability.

    By offering retirement plans with matching programs, retention bonuses, financial education, and planning tools, you demonstrate a commitment to your employees’ economic well-being beyond their working hours. These initiatives not only help employees navigate the challenges of inflation but also contribute to reducing financial stress, improving productivity, and fostering a positive work environment.

    Let Us Help 

    If you’re unaware of where to start, contact Group Management Services (GMS). GMS is a professional employer organization (PEO) that helps small businesses by taking on the administrative burdens you don’t have the time or expertise to handle. We help in all areas of your business, whether it be risk management, HR, benefits, or payroll; we do it all. We can help you set up a fully customizable retirement savings plan that makes your company more attractive to quality employees. When you partner with GMS, you can easily establish the following for your business: 

    • 401(k) eligibility requirements 
    • Vesting schedules 
    • Tax-deductible matching 
    • Profit-sharing 

    Contact us today so you can begin helping your employees during these challenging times. 

  • As the calendar pages turn, business owners should begin thinking ahead to the next open enrollment season, understanding the importance of bridging the benefits communication gap. With November months away, it may seem premature to focus on benefits communication, but the truth is that early preparation is key to ensuring a smooth and successful open enrollment process.

    With the open enrollment period for employees approaching, business owners face a common challenge: effectively communicating the value and details of their benefits package to their workforce. Failure to bridge this benefits communication gap can lead to the following:

    • Employee dissatisfaction 
    • Low utilization of benefits 
    • Missed opportunities for both employees and the business itself

    Continue reading to explore practical strategies that business owners can employ to close the benefits communication gap, ensuring that employees understand, appreciate, and maximize their benefits.

    Start Early And Create A Clear Timeline

    Opening the communication lines well before the open enrollment period is crucial. Develop a clear timeline that outlines key dates, milestones, and other important information. Then, communicate this timeline to employees, giving them ample time to review and understand their benefit options.

    Meg Williams, GMS’ Benefits Account Manager, emphasized, “Effective communication has always been vital to open enrollment season. For employees, it’s a time that can make them feel confused and anxious. Open communication during the open enrollment process can help streamline this process and increase participation in important benefit offerings.”

    Tailor Your Message

    You must recognize that employees have diverse needs, preferences, and levels of understanding regarding benefits. Craft your communications to cater to different employee demographics, ensuring each group receives targeted information that resonates with their specific concerns and interests. It’s essential to remember that everyone is on their own unique journey. Take, for example, a 24-year-old recent graduate, full of excitement and starting their career, compared to a 60-year-old employee who is approaching retirement while potentially dealing with health challenges. These individuals have vastly different needs and interests regarding their benefits. Recognizing and addressing these diverse life stages and personal circumstances is essential in crafting benefits offerings that resonate with employees and support them at every step.

    Simplify Complex Information

    Benefits information can often be dense and overwhelming. Simplify complex concepts by using clear, concise language. Consider using visual aids, such as infographics or videos, to break down intricate details and make them more digestible for employees.

    Utilize Multiple Communication Channels

    Let’s face it; Everyone has different communication preferences. Some prefer email, while others may be more receptive to in-person meetings or a bigger group gathering such as a town hall meeting. With that in mind, utilize a combination of channels to reach employees, ensuring that the benefits information is accessible to everyone. This may include email newsletters, intranet portals, bulletin boards, webinars, and one-on-one sessions.

    Offer Personalized Guidance

    Many employees struggle to navigate the intricacies of benefits packages and may be unsure which options best suit their needs. Consider providing access to benefits specialists who can offer personalized guidance and answer questions. This can be done through dedicated support hotlines, online chat services, or even arranging in-person consultations.

    Consider Sharing Success Stories

    Highlighting success stories of employees who have maximized their benefits can inspire others to take advantage of available options. Encourage employees to share their positive experiences, whether through testimonials, case studies, or even internal newsletters. Real-life examples can help employees see the tangible value of their benefits.

    Foster A Culture Of Wellness

    Beyond the open enrollment period, business owners can further engage employees by promoting a culture of wellness. Offer workshops, lunch-and-learns, or seminars on mental health, nutrition, and work-life balance topics. By emphasizing the connection between well-being and benefits, employees will develop a deeper appreciation for the value of their benefits.

    Get Rid Of This Process In Its Entirety By Partnering With A PEO

    Closing the benefits communication gap is vital for business owners as open enrollment approaches. We understand that the open enrollment period is stressful and time-consuming, especially for small business owners. Fortunately, there’s a solution you may not have thought of – outsourcing your benefits administration to a professional employer organization (PEO) like GMS. This is a game-changer for small business owners looking to prepare early and ensure a smooth open enrollment season. With our expertise and resources, we can assist in crafting a comprehensive benefits communication strategy.

    By simplifying complex information, tailoring messages to different employee demographics, and utilizing various communication channels, PEOs help small business owners effectively convey the necessary details and actions employees must take. From providing personalized guidance to organizing workshops and consultations, PEOs empower employees to understand and make informed decisions during open enrollment. Meg added, “GMS has Benefits Account Managers on staff that work with clients to notify employees when it’s time to enroll in their benefits, provide concise overviews of all plans being offered, and provide easy access to benefits through the GMS Self Service Portal.”

    By leveraging the support of a PEO, small business owners can confidently navigate the open enrollment process, ensuring that all employees are equipped with the knowledge they need to take full advantage of their benefits when the time comes. Contact us today to learn more.

  • In the age of “quiet quitting,” when employees silently resign without expressing their dissatisfaction, it can have detrimental effects on your business. The subsequential decreased productivity and high turnover rates further negatively impact your organization long term. However, we understand that it may not always be feasible to raise wages, provide bonuses, or offer other monetary incentives as motivators.

    In today’s competitive business landscape, it’s essential your organization understands the importance of recognizing and encouraging your employees beyond monetary rewards. While financial motivators have traditionally been the go-to method for acknowledging employee contributions and are still relevant and valuable motivators, forward-thinking companies are now exploring non-monetary ways to inspire and engage their workforce.

    Beyond a paycheck, bonus, raise, and other financial motivators, alternative approaches can tap into intrinsic influencers such as personal growth and a sense of purpose that profoundly impact employee satisfaction, productivity, and retention. By tapping into alternative methods, you, as an employer, can help foster a culture of appreciation, engagement, and loyalty, ultimately driving higher levels of productivity and employee satisfaction. If you are unsure where to begin, we’ve gathered a few strategies to help get you started.

    The Power Of Non-Monetary Rewards

    Intrinsic motivation refers to an employee’s internal drive to engage in a task or activity. Unlike extrinsic motivation, which relies on external rewards, intrinsic motivation depends on personal fulfillment, a sense of achievement, and enjoyment of the work and work environment. By understanding the power of intrinsic motivation, you can tap into a deeper level of employee engagement.

    Intrinsic motivators or non-monetary rewards have profound psychological benefits that positively impact your employees’ well-being and job satisfaction. When employees receive recognition and rewards that go beyond financial compensation, it fosters a sense of appreciation, validation, and belonging. These rewards can include verbal praise, certificates of recognition, and growth opportunities. Recognition of employees’ efforts affirms their skills and abilities, providing a sense of mastery and competence. Recognition and reward programs can also reinforce a positive work culture, fostering a sense of camaraderie and loyalty among employees. Moreover, non-monetary rewards can align with an employee’s personal and professional goals, creating a greater sense of purpose and fulfillment in their work.

    Additionally, as Gen-Z and millennials continue to bring a fresh perspective to the workplace, it’s crucial to acknowledge their unique expectations. While financial rewards and compensation remain high motivators, these generations seek companies that prioritize flexible work arrangements and provide employee perks such as gym memberships and education stipends. These offerings reflect a genuine dedication to their personal and professional development, which can assist retention efforts.

    Non-Monetary Recognition And Motivation Strategies

    Many non-monetary strategies could benefit your organization. Here are just a few:

    1. Provide meaningful feedback and appreciation: Establish a process to regularly provide constructive feedback and recognition to employees for their achievements and efforts. Offer opportunities for managers and employees to share specific feedback highlighting strengths and accomplishments.
    2. Recognize achievements publicly: Public recognition of accomplishments during team meetings or company-wide announcements can have a powerful impact. It not only boosts the morale of the recognized employee but also inspires others and sets a positive example for the entire organization.
    3. Flexible working: Granting flexibility in where and when employees can work promotes work-life balance and acknowledges employees’ diverse needs and responsibilities outside their professional roles.
    4. Additional leave: Providing bonus days off, extended lunch breaks, and offering options to leave early on Fridays or start late on Mondays are all effective motivators for employees.
    5. Professional development opportunities: Whether internally or through sponsoring professional development opportunities, you can enhance employee motivation and commitment to your business.
    6. Mentorship programs: Similarly to professional development opportunities, providing employees the chance to be mentored by internal managers, C-suite executives, or external programs can significantly impact employee motivation and enthusiasm towards their work.
    7. Team-building activities: Offer opportunities for your employees to collaborate outside of work. Through activities such as game or trivia nights, volunteer days, or team luncheons, you can help foster positive relationships between employees, which helps create a positive work culture.
    8. Wellness programs: Create a work environment that emphasizes the importance of self-care by offering incentives such as workshops, wellness retreats, or mental health days for your employees. By promoting a culture that values well-being, you demonstrate a commitment to supporting your employees beyond their professional responsibilities alone.

    Implementing Non-Monetary Recognition Programs

    In the current hybrid and remote work landscape, it’s become increasingly crucial to discover methods for motivating and acknowledging employees. However, it’s vital to tailor your approach according to your organization’s unique characteristics and needs. Recognizing the individuality of your company ensures that the motivational strategies you choose are effective and resonate with your employees.

    One effective way to tailor your approach is by actively involving your workers through regular surveys and feedback sessions. By gathering valuable insights and perspectives, you can better understand the areas where employees want to be recognized and adjust your efforts accordingly. This approach also assists in developing recognition programs that align with your business’ values and traditions.

    While implementing and iterating your strategies, setting clear and attainable goals is crucial. You can effectively track progress by defining specific objectives, such as increasing employee morale, improving team collaboration, and establishing measurable targets. This ensures that your recognition programs are purposeful and have the desired impact.

    Disadvantages Of Non-Monetary Rewards

    Though there aren’t many disadvantages to non-monetary rewards, there are a few things to consider. If you have a sizable team, your goal should be to increase productivity, and giving out non-monetary rewards may not be enough to encourage employees. Therefore, instead of replacing monetary incentives, it’s advisable to use non-monetary recognition programs in conjunction with them. Achieving a balance between the two approaches will yield the best results.

    Another potential challenge is implementing recognition and reward programs that fit within your budget but also meet the desires of your team. It can also take a substantial amount of time to implement and generate company-wide buy-in. Thus, it’s important that you’re aware of the resources needed before you get started. Partnering with a professional employer organization (PEO) or hiring an employee engagement personnel to assist your efforts can be a good place to start.

    Ensuring Success

    It’s essential to generate buy-in from both leadership and employees to ensure the success of your chosen strategies. To assist in this process, communicate the value of non-monetary recognition to your leadership team. Transparently explain the reasons behind implementing these strategies and highlight how they contribute to employee development, well-being, and job satisfaction. Clearly articulate the connection between recognition and the overall success of the organization.

    Additionally, routine and consistent communication is critical. Regularly inform employees about the specific non-monetary rewards available and provide clear guidelines for earning them. Encourage managers to discuss and promote recognition programs with their teams openly. Doing so will help create a culture that appreciates and celebrates employee accomplishments.

    Finally, you should monitor the effectiveness of non-monetary recognition strategies to ensure their success. Regularly gather employee feedback through focus groups or one-on-one conversations to assess their perception of the recognition programs. Keep track of the frequency and types of recognition utilized and evaluate their impact on employee motivation and engagement. Use this feedback to identify areas for improvement and make necessary adjustments to the strategies. Recognition programs should continually improve as you gather feedback. Thus, flexibility and adaptability are key.

    Performance Management Assistance

    At GMS, we understand that your employees are your greatest asset. However, managing them and maintaining a positive work culture can be difficult. As a business owner, performance management is critical to making training, career development, compensation, transfers, promotions, and termination decisions. It allows you to set clear goals and expectations for each employee and provide feedback about their performance related to those goals.

    With our employee performance management service, we can help you strategize ways to reengage your employees, help you define your goals, and set employee expectations. We even take on the administrative burdens associated with managing employees. Ready to get started? Contact us today to connect with one of our specialists!