[HN Gopher] Launch HN: Savvy (YC W20) - Give employees tax-free ...
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Launch HN: Savvy (YC W20) - Give employees tax-free cash for health
insurance
Hi HN, we are Suril and Kevin, and we are launching Savvy
(https://www.gosavvy.com) -- a new way to offer health benefits for
U.S. startups and small businesses. With Savvy, you give employees
tax-free funds, and let them buy any insurance they want. This has
recently become possible because of a new federal regulation, which
has the potential to significantly improve the healthcare situation
for employees, saving them money and giving them more control. For
example, employers could give employees $500 a month for health
benefits, and an employee could opt for a $600 health insurance
plan. Both the $500 employer contribution and the $100 employee
contribution would be fully tax-free. We (Suril and Kevin) both
worked at our own families' small businesses and know first-hand
the pain of figuring out health benefits for employees. Today,
small employers in the U.S. that can afford to offer health
insurance (most cannot) must work with a broker to pre-select 1 or
2 "one-size-fits-all" health plans for their employees. These are
called small group health plans, and they come with some downsides.
Employers are in the difficult position of prying into their
employees' (or co-founders') medical histories if they want to do a
good job, and they take on an HR/benefits role that they may not
want or have time for. Additionally, small group health plans come
with restrictions -- over 75% of employees must participate in the
plan, employers must pay at least 50% of the premiums, and the
company may need to be above a certain size (typically 2-5
employees). These downsides, along with the cost of health
insurance (more on that in a bit), mean that many small businesses
simply don't offer health benefits to their employees. This is bad
for employees because they then must pay for health insurance
themselves with after-tax income. This effectively means their
health insurance, which is already a substantial expense, is 25 -
40% more expensive. This also makes it harder for small employers
to attract good employees. We are only able to launch Savvy
because of new regulation that went into effect this year (on Jan
1, 2020). The vehicle we are using to offer this kind of health
benefit is called the Individual Coverage Health Reimbursement
Arrangement (ICHRA). Outside of the industry, this new regulation
has hardly received any attention, but we think it will be big.
Our backgrounds are in HR tech and fintech. While working on a
different healthcare product a year ago, we saw the ICHRA
regulation get finalized and felt that there was an opportunity to
package this new benefits option into a full product that
simplified health benefits for small employers. The U.S. system of
employer-provided healthcare, which started when wage freezes were
put in place during WW2, is an anomaly among western countries. One
of the biggest issues is that the buyer of health insurance (the
employer) is not the consumer (the employee). This fundamentally
misaligns incentives. Many small employers we speak with don't
believe employers should be making this very personal decision for
their employees. We agree. We guide employers through picking a
contribution amount (we show them how their contribution compares
to health plan prices in their area) and manage the corresponding
paperwork, compliance, and payroll adjustments. For employees, we
provide an in-app marketplace with access to every individual
health plan, as well as vision and dental options. Employees can
speak with licensed brokers every step of the way. Because
employees control how they allocate their funds, they can even use
the money to pay for existing insurance plans, including COBRA from
a previous employer. Most of our revenue comes from flat per-head
administrative fees. We make a small amount of money when employees
buy insurance through our in-app store, but this hasn't been a
focus for us so far since broker commissions are significantly
lower for non-group plans. We think this is a good thing because it
better aligns incentives for us and our customers, and we are not
encouraged to favor one health plan over another based on broker
commissions. Most of our customers fall into four categories (#3
was an unexpected surprise for us). 1) Startups who want to get
the tax-savings of employer provided benefits for their co-
founders. Sometimes a founder will even want to keep a COBRA plan
but pay for it with company funds (remember the 25-40% savings we
discussed earlier). 2) Companies getting ready to make their first
hire and want to offer health benefits in a fast and easy way. 3)
Distributed teams who have difficulty buying a company health plan
for employees spread across the country. We were surprised when a
European-based company approached us, looking to offer health
benefits for their U.S.-based salespeople scattered across a few
different states. 4) Small businesses who have deferred the health
benefits decision, and have employees who are currently paying for
their own health insurance with post-tax income. We're seeing a
surprising increase in signups due to coronavirus. Many startups
and small businesses are scrambling to find a quick way to get
their employees health coverage, and with us, their employees can
get coverage even if they missed open enrollment at the beginning
of the year. Making it easier for employers to offer health
benefits is a good start but, in the future, we want to help them
get lower prices as well. We are looking into aggregating our users
into buying groups to get big-company rates on insurance. Large
employers receive discounts because they buy in volume. Buying
groups are a very active legal topic right now -- we're following
along closely. If you have experience managing health benefits at
your own workplace or just have thoughts on how we can make the
experience better for employers or employees, please reach out!
We're keen to get the community's input, in the comments below or
at hn@gosavvy.com.
Author : kevc
Score : 96 points
Date : 2020-03-09 17:07 UTC (5 hours ago)
| rebelidealist wrote:
| This is nice for remote companies. We went to the pain of trying
| to get a good price Kaiser group plan but found out that Kaiser
| doesn't operate in other states that we have employees in.
| kevc wrote:
| Thanks! We have definitely found we are a good fit for remote
| companies with employees in multiple states. If you don't mind
| me asking, what did you end up doing for your health insurance?
| koolba wrote:
| So what is this providing over simply cutting a QSEHRA check to
| your employees?
|
| Seems like it's complicating something that requires nearly zero
| paperwork already. Just cut a check and make sure it's uniformly
| calculated across your workforce.
| kevc wrote:
| The QSEHRA was kind of like the beta version of the new ICHRA.
| Many of its limitations have been lifted with the new
| regulation. QSEHRAs are restricted to under 50 employees, and
| have caps on how much employers can contribute (~$420 / single
| employee). We don't have those restrictions. Also, any extra
| employee contributions would still be taxable if you were to
| just cut QSEHRA checks as an employer.
| unlinked_dll wrote:
| As an employee whose has been on the receiving end of this, I
| won't work anyplace that does it. I'm sure I'm not the only
| one.
| danShumway wrote:
| Honest question as someone who's never worked at a place that
| does this -- what left you feeling negative about it?
|
| Are the marketplace plans substantially worse than the
| employee plans, or are there extra caveats that come along
| with QSEHRA, or was it something else?
| unlinked_dll wrote:
| My marketplace options were bad, expensive, and numerous.
| Coupled with relocation, I had next to no information about
| what plans/providers/networks were decent, and had a very
| short time to research and decide about what to spend on.
|
| Routine services were ok (I did splurge a bit to have low
| specialist and prescription copays). Dental was not
| affordable.
|
| Going to a different job that took care of finding decent
| coverage options that fit the company and location made my
| life a lot easier and improved my quality of care and out
| of pocket expenses, while removing much of the stress in
| finding a healthcare provider that fit my needs and budget.
|
| That's why I won't do it. It's too stressful, too
| expensive, and the quality of the plans are shit.
| koolba wrote:
| They're substantially worse. ACA plans have worse networks,
| higher deductibles, and higher max out of pockets.
|
| Imagine if they didn't? No employer under 50 employees
| would bother getting group coverage as they could get
| better coverage for less via the QSEHRA route.
| tptacek wrote:
| I had ACA coverage before we offered group health
| insurance to our employees and did not find these things
| to be true: the network for my ACA silver plan was the
| same (fine) network as we get now, the deductible options
| are the same (but I was opting for higher deductibles to
| go with an HSA on the ACA plan, which is what I think
| most startup employees should do), and the out-of-pocket
| costs were the same.
|
| I suspect that a lot of people alarmed by ACA costs are
| really just observing that their employers were
| subsidizing a lot of stuff for them. That's true!
| Employers who give you group coverage directly are
| usually giving you a shadow pay raise in the background
| to make the numbers look better!
|
| But for startups, the difference between the individual
| market and the small group market probably aren't usually
| that big --- as you'd expect, since a small startup isn't
| really aggregating much risk.
| runako wrote:
| My POV (from GA) is that this is going to be highly
| state-dependent.
|
| For example, the first couple years of the ACA there were
| N vendors providing ACA plans materially similar to small
| group plans. Today, most of those vendors have abandoned
| the individual market. So the quality of plans/carriers
| available to ACA purchasers vs small groups is vastly
| different today.
|
| In 2015 it was the case the $500 in the individual market
| was roughly equivalent to $500 in the small group market.
| Today, $500 (or $1000) spent in the individual market
| won't buy you the same coverage as $500 in the small
| group market.
| simmons wrote:
| As a sibling comment points out, the value of ACA plans
| may vary quite a bit from state to state. I don't know
| how it is elsewhere, but here in Colorado the major
| insurance companies only provide a special, lousy version
| of their product on the marketplace. It's not uncommon to
| find health providers that claim to take Anthem or Cigna
| insurance, for example, only to show up and be told that
| "Anthem Pathway" and "Cigna Connect" don't count.
| Astonishingly, they don't seem to be willing to sell
| regular plans to individuals for any amount of money.
| (Source: self-employed.)
| tptacek wrote:
| That's common in the small-group market too: the insurers
| have a network they advertise, and then smaller subset
| networks they offer for a lower price. So, I know it's
| true that you have to be careful not to accidentally
| subscribe for the small-network version. It's definitely
| not the case in Illinois that the large-network plans
| aren't available on the exchange; they are. Couldn't tell
| you about California or New York, though.
| tyingq wrote:
| The health plan rates available to individuals cost quite a bit
| more than ones negotiated by a big company or consortium of
| smaller companies.
|
| When I last had to do my own insurance, it was $2200/month for a
| high end, lowish deductible plan that covered my family. Choice
| is nice, but the costs are so high now that I'd rather have the
| lower negotiated rates with less choices.
| SkyPuncher wrote:
| My experience has been the rates are within 20% of each other.
|
| What does that $2.2k number compare to?
| kevc wrote:
| You are right, big-group rates are the lowest. Grouping smaller
| companies to negotiate lower rates is something we are actively
| pursuing.
|
| Small group prices can, on average, be more or less competitive
| than the individual market, depending on geography. In recent
| years, the prices of both types of insurance have been trending
| towards similarity, but there is still substantial variation
| region-by-region.
| bdcravens wrote:
| Not just rates, but options. Before my employer added
| healthcare as a benefit, my options were getting worse and
| worse every year. The last year there weren't any PPOs
| available via the marketplace. (My employer plan is a great PPO
| however)
| [deleted]
| sn wrote:
| https://www.takecommandhealth.com/ is an existing option for an
| ICHRA or QSEHRA. I am not clear what savvy is offering that isn't
| offered by them.
|
| A professional employment organization (PEO) is required to get
| group rates for health insurance as a small business. PEO's
| handle more than just health insurance; they can also handle
| 401k's, disability insurance and remove the need to register as a
| foreign corporation in each state that your employees live in. If
| anyone has recommendations here I would love to hear them.
| kevc wrote:
| Association health plans are a way to group small businesses
| together for large group pricing, without using a PEO.
|
| https://www.dol.gov/general/topic/association-health-plans
|
| We think other companies offering ICHRA services are a good
| thing. It's a new option that can help a lot of people, and
| more vendors will spread the word faster. Savvy works a little
| differently than the existing solutions.
|
| Instead of a reimbursement-based approach, where employees pay
| insurance premiums themselves and submit them for reimbursement
| (like a business expense), we manage the payments for
| employees. This means the insurance bill is paid by the
| employer and any extra employee contribution is deducted from
| payroll. We do it this way so that the employee contribution is
| also tax-free.
|
| We are also investing heavily in helping employees find the
| right plan. Behind the scenes our brokers are recommending
| plans for every employee, and we are building out tools that
| help employees do things like find a plan with a specific
| doctor or hospital in network.
| sn wrote:
| I saw that it's legally possible to form an association
| health plan. I don't think there are very many of them, or if
| there are, they are not public organizations.
| kevc wrote:
| You are right, some of the regulations around association
| plans were only recently decided, so they are not
| widespread. We are very interested and working with some
| experts in the space to better understand how we can
| leverage them.
| elif wrote:
| What's to stop me from receiving a $500 benefit tax-free and
| buying a $250 plan?
| phantom784 wrote:
| I'd think you should be able to do that and put whatever is
| leftover in an HSA.
| kevc wrote:
| Correct, employers can pair their insurance reimbursements
| with HSA contributions if they wish.
| kevc wrote:
| The money your employer gives you can only be spent on
| insurance or medical expenses. So in your example you can buy
| the $250 plan and have $250 / month leftover to pay for
| prescriptions, doctor visits, or other medical expenses. You
| wouldn't be able to pocket the remainder as cash.
| nathan_compton wrote:
| Brave to do a startup when many are agitating to completely get
| rid of for profit health insurance in the US.
| RIMR wrote:
| Healthcare is a human right. For-profit health insurance
| shouldn't exist.
|
| This startup feels like a grift.
| pozdnyshev wrote:
| Imagine being excited to "go to market" to buy health
| insurance.
|
| In the same way that I don't want to have to shop around for
| fire insurance in case my house is burning down, or look up
| water suppliers when I buy a home: I simply want the state
| apparatus to handle these sorts of details.
| Hello71 wrote:
| hopefully this will make the actual costs of private health
| insurance more clear. right now right-wing media emphasizes the
| cost of public health insurance, which sort of works because
| the cost of private health insurance is hidden in the company's
| balance sheets instead of individuals'.
| eganist wrote:
| How does this reconcile with the current system for more
| established firms where employers typically contribute a
| substantial amount towards subsidizing employee healthcare plans?
|
| Not to be a downer, but this feels like an offramp from our
| current system down to an even worse one, one where employers can
| now substantially cut back on employer contributions towards
| health insurance. It may be great for your success, but it just
| feels like it may prove to be a net-negative on US healthcare
| coverage generally because of the loss of collective bargaining
| by employers on behalf of employees, assuming the model takes
| off.
| kevc wrote:
| We are really focused on providing this as an "on-ramp" for
| small employers. Providing large employers an "off-ramp" isn't
| a use case we have seen much interest in. However, there is an
| interesting historical precedent with retirement plans, which
| suggests that there can be systemic benefits that come when
| employees have more control. Pre 1978, employers offered
| pensions as a retirement benefit, and like health insurance
| today, they were selected and managed by an employer -- and all
| kinds of bad behavior resulted in this misalignment of the
| buyer and the beneficiary. 401(k)s were the consumer-driven
| answer to this, allowing companies to offer tax-free funds that
| the employee could manage themselves. Since 401(k)s were easier
| for employers, the number of businesses offering retirement
| benefits grew significantly, and the number of employees
| reaping the tax benefits grew as well.
| eganist wrote:
| I see your point, but to highlight a critical point of
| comparison: that's emblematic of the risk to healthcare.
|
| Pensions were an actual benefit to employees, largely
| subsidized by employers and taking into account various
| employment factors e.g. length of employment, salary, etc.
| With the advent of 401k, that expense was shifted almost
| entirely to the employee save for a remaining "match" benefit
| that the employer still covered.
|
| Retirement and healthcare are two areas where people are
| generally unable to operate with sufficient foresight, opting
| for plans and financial decisions that make less long-term
| sense.
|
| Hopefully you see my concern. It's not in your investors'
| best interest for you to cap out the size of businesses that
| can buy into your service, but (and this is me dreaming) if
| you re-charter as a public benefit corporation toward this
| end, you may successfully build a supportive grassroots
| coalition to drive you forward within your target market
| (small businesses).
|
| ---
|
| Beyond that, there might be value in your team offering
| collective-bargaining-aaS on behalf of your growing small
| business clients. That way you're extracting value not from
| employers/employees but from the insurance industry instead.
| kevc wrote:
| We are extremely interested in engaging in group bargaining
| for lower rates and are actively working with experts who
| have experience doing this. A recent federal ruling has
| opened the door to doing this across state lines, which
| could be very powerful.
| thedance wrote:
| Again I don't want to attribute this to you or your
| company, but the number of right-wing dog whistles you
| have used in this discussion is alarming. Allowing
| insurance to be sold across state lines is generally a
| strategy desired by people who want to drive a stake in
| the heart of the Affordable Care Act. Interstate sales of
| health plans will have the same effect as interstate
| banking and lending: a race to the bottom in which
| insurers choose their regulators.
|
| (The other dog whistle is "aligned incentives" where you
| subtly blame consumers of medical services for presumably
| squandering their insurers' money.)
| dang wrote:
| Please don't take HN threads further into ideological
| flamewar.
|
| This guideline is worth remembering in a case like this:
| " _Please respond to the strongest plausible
| interpretation of what someone says, not a weaker one
| that 's easier to criticize. Assume good faith._"
|
| https://news.ycombinator.com/newsguidelines.html
| eganist wrote:
| > We are extremely interested in engaging in group
| bargaining for lower rates and are actively working with
| experts who have experience doing this. A recent federal
| ruling has opened the door to doing this across state
| lines, which could be very powerful.
|
| This is nice. Infinite power to you if you find success
| with this angle; I'd support it.
| thehappypm wrote:
| Pensions are fantastically unsustainable. 401(k)s are much
| more responsible -- it's your money, you don't have to
| depend on a new crop of people funding your pension.
| HarryHirsch wrote:
| _Pensions are fantastically unsustainable_
|
| How so? Annuities are the best-understood financial
| instrument of all. Of course financial projections fail
| if the participant pool is too small (vide Philadelphia
| with the rotten industries at the core and office parks
| at the periphery), but that is a political decision and
| could be fixed.
| atsmyles wrote:
| Does Savvy provide plans with Health Savings Accounts?
| kevc wrote:
| Yes, we give access to any ACA-compliant plan on the market -
| many of which can be paired with HSAs.
| thedance wrote:
| As someone who has had to shop for health insurance before, how
| am I supposed to just "buy any insurance I want"? On the private
| market? That doesn't work for a lot of people. For example, a
| person who is already pregnant will not be able to simply buy
| health insurance, because nobody sells it.
| kevc wrote:
| We have an in-app insurance market that offers every ACA-
| compliant individual health insurance plan in the country, and
| you can speak 1-1 with a broker to help guide your decision. In
| the case of someone who is already pregnant, ACA-compliant
| plans cannot deny you coverage.
| thedance wrote:
| That's true but it's also true that the plans need not cover
| maternity. There are tons of ACA plans that don't. And in
| "markets" with one player they can just name their price.
| None of this is your fault of course.
| jonas21 wrote:
| Are you sure about that? healthcare.gov seems to suggest
| otherwise [1]
|
| > _Maternity care and childbirth -- services provided
| before and after your child is born -- are essential health
| benefits. This means all qualified health plans inside and
| outside the Marketplace must cover them._
|
| [1] https://www.healthcare.gov/what-if-im-pregnant-or-plan-
| to-ge...
| thedance wrote:
| There are plans that are exempt from ACA's "requirements"
| because of course there are, and the current
| administration has used its rules-making powers to expand
| such exemptions. These are not limited to backwater
| states with evil administrations. At this very moment
| there are plans on California's ACA market that are
| exempt and do not cover maternity.
| tptacek wrote:
| It seems like all you have to say here is that there
| exist ACA-noncompliant plans. Yes, that was always the
| case. Why would you buy one of them? The major reason
| people end up in exempt plans is that they somehow miss
| enrollment (or have a payment snafu that gets them
| bounced from their compliant plan --- ask me how I know
| that). But this product appears to generate a new
| enrollment window; you can just buy ACA-compliant
| marketplace plans with it.
| kevc wrote:
| You would be surprised how common missed payment issues
| are. Many carriers will only notify you via paper mail,
| so it's easy to miss. We manage the carrier payments for
| all enrolled employees to make sure that this doesn't
| happen.
| tptacek wrote:
| It happened to me. :)
|
| I managed to avoid an exempt plan when BCBS screwed up my
| auto-pay. Ironically, I did that by leveraging a mistake
| I made when I first signed up for an ACA plan: I'd mis-
| entered my kids information, which screwed up the
| registration, and when I called for support to fix the
| problem the Marketplace team just created a new
| registration for me. After BCBS screwed up, we were able
| to use the original stale registration to enroll in a new
| plan. I got pretty lucky: the exempt plans retain the
| ability to DQ applicants for preexisting conditions, and
| while my family is healthy, my daughter had an
| unexplained seizure when she was 4 and is, for all
| intents and purposes, excluded from exempt plans.
|
| The thing I think people don't know and really need to
| understand is that if you let your health insurance
| lapse, you can't simply pay up to reinstate it; you can
| only alter your insurance during qualifying events.
| That's because if you _could_ lapse and then pay up
| later, lots of people would exploit that to avoid paying
| for insurance until they needed it, which defeats the
| purpose of insurance.
|
| None of this has anything to do with your startup, of
| course.
| koolba wrote:
| IIUC, there's no denying coverage for any reason during open
| enrollment. Are you referring to applying to get insurance mid
| year? If so you're likely out of luck even if you're healthy as
| there's no mandate to force selling it to you.
| kevc wrote:
| FYI, when an employer signs up with Savvy this qualifies as a
| special enrollment period for all employees. This allows them
| to enroll in health insurance mid-year.
| 1123581321 wrote:
| Does this also work for insurance alternatives that qualify as
| having insurance on an 8965?
| kevc wrote:
| Are you referring to a health share program? In order to spend
| your health stipend tax-free, you must be enrolled in a plan
| that has Minimum Essential Coverage. Paired with an MEC plan,
| you could pay for medical expenses tax-free as part of a health
| share.
|
| https://www.healthcare.gov/glossary/minimum-essential-covera...
| 1123581321 wrote:
| Makes sense. Thanks!
| lamatarata wrote:
| todas las experiencia son buenas
| http://lesitedudccn.com/ocio/las-mejores-peliculas-de-disney...
| pashabitz wrote:
| Mad respect. Keep at it!
| jbkiv wrote:
| Congrats! How do you handle discrimination in your case? I'll
| give you an example: 50% of your employees are young and healthy
| and they opt out of the health plan offered and go with Savvy.
| How do you handle the remaining 50%, assuming that some of them
| are older, have cancer, or have kids with disabilities, diabetics
| or whatever. Would ANY health plan accept to cover only the sick
| and old? This is based a concept called mutualization. I'll be
| interested by your point of view, or if any of your clients came
| across cases like that?
| kevc wrote:
| To prevent this kind of thing from happening, regulations state
| that you cannot offer both Savvy and a traditional group health
| plan within the same "class" of employees (IRS-defined, things
| like full-time vs. part-time vs. seasonal, etc.). If you were
| to offer Savvy, you can scale your employer contribution based
| on age and number of dependents to help address the higher
| costs of healthcare for those employees.
|
| Small groups can get large price increases if their members
| have serious health issues, and for them it can be cheaper to
| use us and get employees all the same tax savings, but buy on
| the individual market.
| unlinked_dll wrote:
| > For employees, we provide an in-app marketplace with access to
| every individual health plan, as well as vision and dental
| options. Employees can speak with licensed brokers every step of
| the way.
|
| I really want to like you for taking a stab at solving this
| problem because it's a serious one for startups and small
| businesses, but I can't as long as you keep this approach.
| Shopping for insurance (even through a broker) is an extra layer
| of friction to the hiring/onboarding process and this needs to be
| removed.
|
| In my experience, startups are bottlenecked by hiring more than
| anything today, and part of that is compensation/benefits. If you
| make it more difficult or more complex for startups to get people
| compensated and set up with benefits, they will decide to work
| somewhere else.
| kevc wrote:
| What do you envision is the best way to do this? Our approach
| is to present employees with a few options upfront that, behind
| the scenes, have been recommended by a broker for them. They
| can speak with their broker if want help understanding and
| selecting one of the recommended plans, or look at the wider
| market if nothing suits them.
|
| We try to streamline the experience as much as possible, and
| put in a lot of work building an interface that explains the
| plan details in-app.
|
| And you always have the option to tell one of our brokers "None
| of these work for me, I want to make sure Dr. Smith is in my
| network, show me more options".
| dv_dt wrote:
| Having been a small business owner who has had to shop, I
| would have loved the "CostCo" quality model applied. I know
| that would be really difficult for a startup with the state
| of our healthcare, but to me it would mean getting in the
| largest insurance pool possible with above average customer
| friendly choices making it easy to say yes. That also implies
| a very few options to chose from, and maybe ideally one (that
| gets you to the larger pool).
|
| BTW costco quality also doesn't mean the absolute highest
| quality, just above average solid options plus using the
| volume to drive the affordability.
| tyre wrote:
| Are you describing HMOs? You have fewer available plans in
| exchange for cost savings with a large pool.
| novok wrote:
| My guess is you would do it like most employers do, provide a
| small menu of options, have a default choice, and if you
| don't make a choice by a due date, enroll the employee in the
| default choice.
| Jommi wrote:
| How does this compare in cost to startups using justworks that
| has better negotiating power for cost savings in the insurance
| even with low amount of employees?
| kevc wrote:
| Choosing a PEO also means that you are outsourcing all your HR
| functions - payroll, retirement, benefits, etc. Part of that
| includes large group insurance prices. In return, you pay a
| per-head fee to the PEO.
|
| If cost is the primary driver for your decision the important
| thing is to compare the PEO fees vs how much money you will
| save on the discounted insurance. We have helped a few
| companies do this analysis - On a pure cost basis, we are a
| better option for some, PEOs win for others. Feel free to reach
| out to hn@gosavvy.com if you want advice on your specific
| situation.
| sn wrote:
| justworks is a PEO and their PEO certification is currently
| suspended. https://www.irs.gov/tax-professionals/cpeo-public-
| listings https://www.irs.gov/pub/irs-utl/suspended-cpeos.pdf
| exabrial wrote:
| If we could see the return of individual HSA plans to the
| marketplace, this would be truly incredible!
| RIMR wrote:
| For whom? Because HSA plans are almost always associated with
| bad health insurance options.
|
| If an HSA plan worked for you, chances are you are young and
| healthy and don't realize what would happen to you financially
| if you needed regular healthcare service under these plans.
| HarryHirsch wrote:
| It's likely that you do not have family members with chronic
| conditions.
| jedberg wrote:
| I can't tell from the website, but can I offer different amounts
| to different employees?
|
| For example, can I offer $2000/mo to someone with three
| dependents and $500/mo to a single person?
|
| ie, $500 per family member.
| kevc wrote:
| Yes, you can do exactly as you describe. I'll make that more
| clear on our website.
| jedberg wrote:
| Ok cool! So I went through the signup flow and got to the
| last step that creates the docs and charges me a $100 setup
| fee, but I'm still not clear on how the program works.
|
| Will this be deducted from their paycheck or from my account?
| Where will that money come from if I deduct from their check?
| Do you integrate with Gusto?
|
| I'm just not at all clear on the logistics of how the money
| moves from my company to their health insurance company and
| what the steps in between are, especially since they already
| have post-tax personal health plans.
| kevc wrote:
| Apologies - We usually walk customers through the setup
| over the phone, definitely needs some work to be fully
| self-serve. We appreciate the feedback.
|
| To answer your question: The premiums will be deducted from
| your account, and any extra employee contribution would be
| deducted, tax-free, from the employees paycheck. We
| integrate with Gusto to set this up for you.
|
| I am happy to walk you through the specifics:
| kev@gosavvy.com
| jedberg wrote:
| No worries, I understand. I think I'm all good now. Maybe
| just some text on that final page with these details
| would be great.
| RIMR wrote:
| Oh wonderful - more for-profit exploitation of people's need for
| healthcare. This business model is only possible because of
| deregulation by our current Federal Government.
|
| I hate to sound mean, but I really hope that this business fails.
| I know people worked hard on this with an expectation of a
| financial return, but 68,000 people die every year because of
| this illusion of choice being exploited here, and if we can fix
| the system and eliminate the health insurance industry altogether
| we're all be better off.
|
| The problem with ventures like this is that they claim to be
| healthcare companies, but their entire model is based around
| minimizing expenses and maximizing profits. Absolutely no
| emphasis is put on ensuring that human beings get the healthcare
| they need without going bankrupt - just that employers can pay as
| little as possible and insurance companies can get as many
| members as possible.
| jkarneges wrote:
| I don't know the details of the new law, but separating
| healthcare from employment is a positive step towards fixing
| the system.
| danpalmer wrote:
| Unless this can be used by employers to move from paying for
| an employee's healthcare, to giving them a smaller amount to
| buy their own.
| IG_Semmelweiss wrote:
| People own Kias and Lamborghinis.
|
| People eat at Popeye's and also at Whole Foods
|
| No one bats an eye as long as both cars work as advertised
| and the food is edible.
|
| When did it become mandatory for employers to pay for
| lmborghini-level service? ?
| kevc wrote:
| Almost all of our current customers are using us to offer
| health benefits to their employees for the first time.
|
| I understand there is frustration with the larger healthcare
| system. No question there are large, systemic challenges. We
| saw a problem that SMBs weren't offering health benefits, and
| felt like there was a solution to help them. That seemed
| preferable to waiting on the sidelines for a complete overhaul
| of US healthcare.
| RIMR wrote:
| That's the thing: Your customers shouldn't even be part of
| the equation.
|
| Healthcare is a HUMAN right, not a workers right or a "if you
| have enough money to pay for it" right.
|
| Ideally, your customers and their employees shouldn't have to
| worry about this at all. You are just another middleman
| standing between human beings and their health.
|
| I see no reason you should exist. You aren't innovating or
| making the world better. Clearly your purpose extends no
| further than to create profits for shareholders.
| dang wrote:
| Please stop taking HN threads into generic ideological
| flamewar. These angry, generic discussions are all the
| same, and not what this site is for. We've had to ask you
| about this repeatedly already.
|
| https://news.ycombinator.com/newsguidelines.html
| eganist wrote:
| > I hate to sound mean, but I really hope that this business
| fails.
|
| I feel bad saying this, but I'm inclined to agree. Part of the
| value prop with mid-large businesses subsidizing healthcare is
| the ability to bargain collectively. Individuals can't do this,
| and just paying that employer contribution to individual
| subscribers for them to find their own healthcare plan will
| result in net-negative benefits year over year.
|
| The more I think about this, the more this startup concerns me.
| zdragnar wrote:
| Small and medium businesses have very, very little leverage
| in negotiating health insurance costs. At best, they just
| switch to a new insurer every year as prices change.
|
| In most cases, an option like this is better than nothing,
| which the founder has already pointed out is a lot of their
| current base.
| eganist wrote:
| > Small and medium businesses have very, very little
| leverage in negotiating health insurance costs. At best,
| they just switch to a new insurer every year as prices
| change.
|
| Right. And that's why I wish a startup like this would
| instead be focused on helping s-m businesses bargain for
| more rather than extract from less.
| kevc wrote:
| We absolutely want to use our platform as a base for
| negotiating lower prices. Currently our customers have 0
| negotiating power and can actually get serious price
| increases if a single person in their group gets sick. For
| employers in this situation, it's often cheaper to use us and
| get employees all the same tax savings, but buy on the
| individual market.
| eganist wrote:
| Thanks for posting this. I'm looking forward to seeing this
| service offering as your customer base increases.
| dang wrote:
| You guys keep saying you hate saying this and feel bad saying
| this, yet you've each posted repeatedly and your comments
| already make up a third of the thread as I write this. That's
| because reflexive comments on divisive topics (like
| healthcare) are the easiest to write and tend to fill up the
| threads early on.
|
| Let's not have yet another predictable flamewar about U.S.
| healthcare. It will just turn into the same flamewar as the
| other flamewars, which is something we try in general to
| avoid on this site. Meanwhile there's something specific to
| discuss about this startup's particular model, regardless of
| where one stands on the brokenness of the overall system.
|
| https://hn.algolia.com/?dateRange=all&page=0&prefix=true&que.
| ..
| eganist wrote:
| An argument can be made that the model shouldn't exist in
| the first place, and part of our comments here are to see
| if we can steer the founding team towards an alternative
| that extracts value from a different target, in this case
| the insurance companies rather than individuals or SBs. In
| a perfect world, YC wouldn't be hedging in favor of a
| deteriorating healthcare system in the US by betting on
| this concept, but that's spilled milk under the bridge, so
| the goal now is to help point the venture a bit
| differently.
|
| Regrets if you view it as non-productive, but the comments
| are certainly intended to be (especially my latest one
| prior to this comment I'm posting now)
| dang wrote:
| If you mean the subthread at
| https://news.ycombinator.com/item?id=22527801, that's
| indeed much better.
| eganist wrote:
| Appreciate you.
| thehappypm wrote:
| This can lift a lot of employees in small companies from having
| no health insurance to having at least some level of coverage,
| and it seems to do so with minimal hassle for the employer. If
| you hope this fails, you're hoping those employees continue to
| have no real means of getting health care.
| freenergi wrote:
| Freenergi is a renewable energy startup company based in
| Indonesia. We provide solar power installation, solar as service
| and manufacture solar power products to reduce residential
| customers electricity bill and providing clean energy solutions
| for indoor and outdoor. We are looking for potentional investor
| and cofounder for this early stage startup. Please do not
| hesitate to contact us at freenergi contact page.
| www.freenergi.com
| choward wrote:
| So we're adding another middleman to the healthcare system? It
| seems like we should be working toward the exact opposite of
| this. I view any service like this that makes money from the
| healthcare industry but doesn't actually provide healthcare as a
| huge inefficiency that will further increase the price of
| healthcare. What's next? A startup that helps you choose between
| these middlemen companies?
|
| This insanity has to stop. I want to be able to get healthcare
| and pay the people providing it directly and know my costs up
| front. It's as simple as that when it comes to healthcare. As for
| "insurance", I don't want to go bankrupt if I get cancer. These
| are two separate issues. Insurance should not be required for
| healthcare.
| kevc wrote:
| We agree that less distance between the buyer and the end user
| is better. In our case, the middleman we are removing is the
| employer. With us, employers are no longer picking specific
| health insurance policies on behalf of their employees. Instead
| employees are purchasing them directly through our app, but
| still reaping the significant tax savings of employer-provided
| health benefits.
| jcrben wrote:
| As someone with a chronic illness, thank you for this. I don't
| want my employer to be responsible for my insurance. I want
| portability and privacy. I want more than just the options my
| employer decided to pick.
|
| If this becomes a trend, we could see the individual ACA
| marketplace strengthened. Right now part of the problem is that
| they are missing a lot of the healthy people in the group market,
| which is partly why the big insurers have left the market - for
| example, the California exchange is missing UnitedHealthcare,
| Aetna, and so on.
| kevc wrote:
| Thanks! We appreciate it. We believe Savvy and the new
| regulations will strengthen the individual market.
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