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From the largest PEOs in the marketplace to small regional providers, the COVID pandemic has challenged each in new and unique ways. The current benefits landscape has been significantly impacted and is subsequently experiencing shifts in the market, demands for new products, and renewed interest in existing products. Some of these may revert to normal when or if the pandemic subsides, while other benefit offerings may become part of a new normal.

How can PEOs navigate this uncharted territory? It’s more important than ever to read the market, meet regularly with clients, and be a vital partner developing a roadmap for today that offers a glimpse into the future.



PEOs have seen many carriers become more flexible, responding in positive ways to make sure coverage is still available and costs remain reasonable for employers and workers alike. Changes seen since the pandemic began to impact the U.S. last year have centered around carriers’ responses to businesses’ needs. Many have waived some of the employee cost-sharing and co-pays required with certain medical visits.

This flexibility from the carriers also included significant changes to how eligible employees are defined. Some carriers loosened rules surrounding qualifying events to allow for more generous changes in plans and coverage. Some issued waivers of the hours required to ensure employees remain eligible to be covered. In some circumstances, carriers allowed employees to remain covered without working at all for a certain period of time, as long their employers continued paying the premiums.

When it comes to workers’ compensation, the opposite is true. If remote work continues, it is possible workers’ compensation rates could drop for companies with remote or home-based employees as risks of jobsite injury decline.

Across the country, we have seen workers’ compensation insurance carriers limiting coverage to certain industries, such as home health, senior living, and other medical operations due to the unknown short- and long-term effects of COVID and, specifically, its effect on workers’ compensation claims cost. The future of that market is unknown. State laws are fluid on whether COVID-related injuries are covered under state workers’ compensation and how exactly that coverage works. PEOs and employers are advised to follow their state guidelines closely to track how workers’ compensation coverage affects them. 

The application of medical care changed quickly and dramatically in the aftermath of the COVID outbreak in the United States last March. Pre-pandemic consumers were slow to embrace telemedicine, but now, PEOs can expect individuals to view virtual visits more favorably. It might even drive improved employee well-care compliance.

That said, the market remains in flux. That means the impact on health insurance rates is unknown. Some expect that costs related to testing, vaccinations, and ongoing healthcare related to employees who contract COVID and require care—from doctor’s visits to diagnostics to hospitalization—could impact individuals’ out-of-pocket expenses and employers’ premiums.

What’s more, according to data from the Centers for Disease Control and Prevention (CDC), four in 10 U.S. adults have reported putting off medical care because of concerns related to COVID, from annual visits to follow-up appointments for previously diagnosed ailments. They expect this could lead to a level of worsening health among the workforce, which could affect future claims and plan costs.



Among existing coverage areas getting renewed attention from employers, employees, and carriers are employee assistance offerings such as mental health counseling and financial wellness. Certainly not new, they are growing in importance for employers whose workforces include working parents with children at home and those concerned about personal finances and student loan repayments. An employee assistance program, or EAP, is one example of how employers can help their employees navigate the personal, professional, and financial anxieties that contribute to stress, which in turn, may be adversely affecting work performance and morale.

The COVID pandemic has heightened employers’ awareness about cybersecurity risks. With employees working from home, it’s critical to set policies and practices to close loopholes related to open networks, securely handle proprietary internal or client data, set boundaries for personal use of company laptops, and even address potential risks associated with access to printers and/or the shredding of company documents.



As a trusted support system for clients, it’s imperative that PEOs stay on top of this rapidly changing business landscape. Don’t assume, however, that you know what is most important to your clients or their workforces, or even that your clients know exactly what they want. Work with your clients to gauge their needs and expectations. Be sure to regularly remind them what you offer. If you don’t already, create and post a COVID resource page with tools and information related to new benefits, changing regulations, and state and federal resources. Dedicate a team to keeping it up-to-date with the latest changes. This may require redefining employee roles to cover ground you never had to address before. Your insurance carriers, brokers, and legal and financial partners may be able to offer guidance.

With such dramatic changes in policies, practices, and plan offerings, it’s critical that employers keep the lines of communication open with their employees. Whether hosting employee training or information sessions, all changes should be incorporated into the employee manual or handbook. Once revised, it’s best if you can leverage technology to have employees acknowledge that they have received it and sign off on having read it. 

The changes to the health and benefits landscape brought about by the pandemic have been widespread, and while it’s too soon to say which changes will be here to stay, PEOs, plan providers, and carriers alike will continue to have to work quickly to react to an ever-changing market. As employers face the rollout of COVID vaccines and we, hopefully, inch closer to a return to normal, make sure today’s roadmap doesn’t become tomorrow’s uncharted territory.


Barbara Drames

Director, PEO Benefits

Oasis, a Paychex Company

West Palm Beach, Florida


Mark Rodefeld

Director, PEO Workers’ Compensation

Oasis, a Paychex Company

West Palm Beach, Florida


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