PEO Health Insurance
Fortune 500 Health Plans at Small Business Rates
PEO health insurance is the biggest reason small businesses join a PEO. By pooling your employees with thousands of others, a PEO gives you access to Fortune 500 health plans at large group rates that individual small employers cannot access. You get the same plans and networks as big companies, at a cost your business can afford.
Savings versus traditional small group
Plans and networks
Rating pool through the PEO
To compare PEO health insurance
Key Benefits Cost Factors
Fortune 500 Plans
PEOs offer the same tier of health plans that large corporations offer, including national networks and rich plan options.
Large Group Pooling
Your employees are pooled with thousands of others in the PEO master group, giving you large group rates instead of small group rates.
Lower Premiums
Large group rates are 15 to 30 percent lower than small group community rates for the same level of coverage.
Multiple Plan Tiers
PEOs typically offer multiple metal tiers, from high deductible HSA plans to rich PPO plans, so you can choose what fits your budget.
National Networks
PEO health plans often use national provider networks, so your employees can keep their doctors wherever they are.
Stable Renewals
Because the PEO group is large, renewal increases tend to be more stable and predictable than small group plans.
How PEO Health Insurance Works
When you join a PEO, your employees are covered under the PEO master health insurance policy. The PEO pools your employees with thousands of others across all its client companies. Because the pool is large, the PEO negotiates Fortune 500 level health plans at large group rates. You get the same plans, networks, and pricing power that big companies have. You pay based on your employee count and the plan you choose, just like a large employer would.
- Your employees are covered under the PEO master health policy
- The PEO pools your employees with thousands of others
- Large pool means Fortune 500 plans at large group rates
- You get the same plans and networks as big companies
- You choose the metal tier and plan that fits your budget
- Renewals tend to be more stable due to the large group pool
Why PEO Health Insurance Costs Less
PEO health insurance costs less for a structural reason. Small group plans are community rated, which means your rates are tied to the average small group, not your specific group. Small groups pay more because they lack buying power. A PEO moves your small group into a large group rating pool, which means you get large group rates. The difference is typically 15 to 30 percent. On top of the lower rates, you get access to Fortune 500 plan options and national networks that are not available in the small group market.
What Else Comes with PEO Health Insurance
PEO health insurance is part of a bigger package. The PEO also handles payroll, tax deposits, workers comp, compliance, and HR support. On the benefits side, most PEOs offer dental, vision, life, disability, and retirement plans alongside health insurance, all at group rates. For a small business, this means you get a full Fortune 500 benefits package and a full back office team for less than the cost of your current health insurance alone in many cases. A broker can show you the full package and the total cost.
PEO Health Insurance FAQ
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What plans are available through a PEO?
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