This year there have been atrifecta of government announcements regarding benefits programsdesigned specifically to help small business. They essentiallyloosen the regulatory reins on existing, proven programs. (Photo:Shutterstock)

Small business is the backbone of the U.S. economy, with oversix million businesses representing 60 million employees. Yetsmall businesses have the most challenging pathto providing benefits for their employees.

High costs, inefficient management systems, and governmentregulation have all presented obstacles that have left the majorityof U.S. small business workers without employer-sponsoredbenefits.

In fact, Kaiser Family Foundation found that only 47% of smallemployers provide any medical benefits, compared to 91% ofmid-sized employers.

When it comes to retirement, the numbers are even worse – fewerthan 20% of small employers offer any retirement savings. And weknow from experience that if you don't save through work, youprobably don't save at all.

But good news is on the way for small business. This year therehave been a trifecta of government announcements regarding benefitsprograms designed specifically to help small business.

They essentially loosen the regulatory reins on existing, provenprograms to expand the definition of small businesses that can tapthe power of collective buying or reimburse employee spending.

The beauty of these changes is that they are politicallyagnostic as Democrats, Republicans and Independents alike own andclaim small businesses in their constituencies.

Association Health Plans

In June, the first horse in the trifecta crossed the line whenthe Administration announced the loosening ofrestrictions surrounding Association Health Plans so that morebusinesses can aggregate for the purpose of purchasing collectivemedical and other benefits.

While these collective sourcing programs have been around sincethe 1970s, they were cumbersome and expensive to create and managefor all but the largest companies.

Now, under the new rules, millions more businesses can qualifyfor AHPs to ease the cost of, and increase accessto, health benefits for their employees.

These redefined rules allow companies to band together byindustry or geography in entirely new ways. Associations,Franchisees, and Chambers of Commerce around the country areaggressively moving to deploy AHPs to help their membercompanies.

AHPs work!  For example: one franchise system foundthat 35% of new members in the AHP  had never offeredbenefits before, bringing more employer benefits to more smallcompanies. Member companies that had previously offered benefitswithout the advantage of collective purchasing reduced costs anaverage of 23%, over $1,100 per employee. And these are all ACAcompliant insurance coverages, with pre-existing condition coverageincluded.

Association Retirement Plans

The second finisher in the race is the recently introducedAssociation Retirement Plan (ARP). Modeled after AHPs, these newplans modify regulations to increase opportunities for collectivesourcing of 401(k) plans across small businesses.

Previously known as “multiple employer plans,” these programsdramatically cut the cost to employers offering a 401(k) – often bymore than 50% – materially reducing employee borne managementfees.

They have been in existence for years. In fact, my own companymoved to such a program reducing both my Employer cost (by 50%) anddramatic reduction of employee management fees.

Through the magic of compounding interest and reducedtransaction cost, our employees are projected to increase theirlifetime 401(k) savings by over $98,000 per person. That's realmoney.

Now, proposed guidelines would make it easier and faster foreven more small businesses to launch the newly named ARPs.

These small businesses can band together as a group tocollectively source more cost-effective 401(k) solutions through anARP for its members.

The plans have the potential to deliver employer-sponsoredretirement saving options to millions of employees formerlyexcluded by cost and complexity from traditional 401(k) plans fromdoing so. It's good news for the small business community and greatnews for workers.

Health Reimbursement Accounts

Finally, the last horse in this race is the planned expansion ofHealth Reimbursements Accounts (HRAs) —accounts that can be used to reimburse individual health insurancepurchased by employees.  This move by the Administrationhelps strengthen today's Individual Health Insurancemarketplace.

Technically, this option already exists today under alittle-known program called the Qualified Small Employer HRA(QSEHRA).

This program allows small businesses with less than 50 lives tofund a tax-deductible HRA for employees, so those employees may bereimbursed for their medical premiums out of and up to the fundedHRA balance.

Beginning in 2020, all HRAs will now have that same capability.This is perfect for the smallest of businesses, includingstart-ups, and for Associations or Franchises not quite ready forthe collective benefits sourcing of an Association Health Plan.

Together, these three changes help close the gaps in health andretirement benefits for America's small businesses.

A thriving small business community is good for the nation, andthe combination of these programs helps ensure that all businesseshave a chance to compete with larger corporations for a talentedworkforce by extending improved benefits to their workers.

Chris Duncan is the EVP & COO of Decisely, aninsuretech firm specializing in small business solutions forBrokers, Associations and Franchises.  He is also theformer Risk Manager/Head of Security for a major nationalfranchisee brand in the Quick Service RestaurantIndustry. Decisely is a Benefits brokerage and HR servicesfirm specializing in integrated technology solutions for SmallBusinesses. Supported by licensed benefit brokers and industryprofessionals, the Decisely solution provides the right mix ofhealth care benefits, recruiting, HR admin, compliance, and payrollon one easy-to-use platform.