Personalized Employee Benefits Without Breaking the Bank: The PHI Advantage

Read time: 6-minute, 52-seconds

Imagine running a mid-sized company with 300 employees, where you're constantly juggling the need for personalized benefits while keeping expenses under control. Employees want mental health services, telehealth options, and retirement support. Yet, every dollar spent on new benefits eats into your earnings. You recently launched a wellness program that has yet to live up to employee expectations, and now crucial talent is leaving for competitors with better offerings. Expanding the benefits package could cripple your profits, leaving you stuck in a lose-lose situation—unable to satisfy employees without hurting the bottom line.

Many mid-sized companies face this problem. According to the Kaiser Family Foundation, family health coverage premiums reached $20,576 annually in 2019, leaving little room for businesses to invest in other meaningful employee benefits without stretching budgets too thin.

Real-World Example:

A 2020 study showed that 80% of employees rank benefits as a top priority when deciding whether to stay with a company. While big companies like Google or Salesforce can afford top-tier, customized benefits, only some businesses can.

This is where the PHI program comes in, helping companies offer similar competitive benefits without breaking the bank.

The Problem with Offering Customizable Benefits:

Providing customizable benefits is a growing challenge. Today's employees expect more than basic health insurance—they want mental health services, financial wellness programs, and telehealth options. However, balancing these diverse needs without hurting profitability is challenging, especially for small- and medium-sized companies.

The Financial Strain:

The biggest obstacle is cost. Offering diverse benefits, like comprehensive mental health support or financial wellness programs, requires extra vendors, technology, and management resources. All of this adds up.

In 2019, employer-sponsored family health insurance averaged $20,576, according to the Kaiser Family Foundation.

These costs often become overwhelming for smaller businesses, forcing them to cut corners or overspend. However, the PHI program significantly reduces these financial burdens, providing much-needed relief to HR managers.

When companies cut corners on benefits, they risk losing top talent. On the other hand, overspending impacts profits and limits growth. It's a tough choice—either one hurts the business.

Administrative Complexity:

Offering customizable benefits also adds complexity. Managing different benefit plans, vendors, and reporting requirements increases HR's workload, which often leads to inefficiencies and higher operational costs. Small businesses with limited HR capacity struggle the most, while larger companies spend heavily on technology and talent just to manage the complexity.

Disengaged Employees:

Without personalized options, employees can quickly become disengaged.

According to a Gallup poll, only 34% of U.S. employees feel engaged at work. One key reason? The lack of personalized benefits.

Today's workforce wants flexibility—telehealth, wellness programs, and mental health support. Companies that fail to offer these options face lower morale and higher turnover rates.

Disconnect Between Employee Needs and Employer Offerings:

Every employee has different needs. Younger workers may prefer wellness programs or help with student loan repayment, while older employees may prioritize retirement plans and comprehensive health coverage. A one-size-fits-all approach won't cut it anymore, yet many businesses can't offer tailored benefits due to cost and administrative complexity.

Without flexible benefits, businesses offer generic plans that don't address employees' specific needs. This leads to frustration, dissatisfaction, and, ultimately, poor retention.

The Solution: How PHI Works

Project Blue 's Preventative Health Initiative (PHI) provides a simple, effective solution for businesses struggling with the cost and complexity of offering personalized benefits. Its straightforward implementation and management process will give HR managers peace of mind and confidence in its success.

Tax-Free Benefits for Employees:

With PHI, each participating employee receives $1,500 annually in a portable Cash-Value Whole Life Insurance policy. This policy builds cash value over time, providing long-term financial security that employees can leverage for retirement, loans, or direct withdrawals. This financial security, along with access to wellness services, such as telehealth and mental health support, makes PHI a compelling choice for employees.

These benefits are accessible to the employee. They don't see any reduction in take-home pay, meaning they can enjoy better benefits without feeling financial pressure.

FICA Tax Savings for Employers:

Employers benefit too. Companies save $500 to $600 in FICA taxes annually for every employee enrolled in the PHI program. This can add up fast, especially for companies with larger workforces. For instance, a company with 500 employees can save $250,000 to $300,000 annually. These savings can be reinvested back into the business—improving benefits, upgrading technology, or funding growth initiatives.

Stacking PHI on Top of Existing Benefits:

PHI doesn't replace existing benefits—it stacks on top of them. Whether your company offers health insurance, 401(k) plans, or other benefits, PHI enhances the current package. Employees get the added security of a Cash Value Whole Life Insurance policy and wellness services, while employers provide better benefits without additional costs or administrative headaches.

No Out-of-Pocket Cost for Employers:

One of the best features of PHI is that it's a cost-neutral solution. The tax savings fund the entire program, meaning employers don't have to spend extra money to implement it. Companies don't have to choose between cutting benefits and cutting into profits. They can offer robust, customizable benefits while maintaining financial health.

How the $2,000 Tax Incentive Is Applied

Here's how the $2,000 savings per employee works:

• Employees: $1,500 is deposited annually into a Cash Value Whole Life Insurance policy, building a financial asset over time. Employees also benefit from wellness services like telehealth and mental health resources without reducing their take-home pay.
• Employers: Companies save $500 to $600 in FICA tax savings for every employee enrolled in PHI. For example, a company with 400 employees can save up to $240,000 annually in payroll taxes. These savings come without any out-of-pocket costs and allow businesses to reinvest in their workforce or other areas of the company.

Real-World Example

A retail company with 500 employees can significantly benefit from PHI. Each employee receives $1,500 in life insurance benefits, 24/7 telehealth, and mental health support services. In return, the employer saves $500 per employee, totaling $250,000 in payroll tax savings annually. Reinvesting these savings strengthens the company's benefits package, driving higher employee engagement and boosting overall satisfaction.

Financial Impact of the PHI Program

The PHI program can generate significant financial benefits for businesses of all sizes. Companies can reduce payroll taxes while increasing employee satisfaction by stacking additional benefits on top of existing employee packages. Below are real-world examples demonstrating the financial impact for companies with different employee counts.

1,000-Employee Company

For a company with 1,000 employees, the PHI program offers $2,000 in savings per employee. This translates into $1,500 in employee life insurance benefits and $500 in FICA tax savings for the employer.

• Total Employee Benefit: $1,500,000 goes into Cash Value Life Insurance policies, offering long-term financial security to employees while providing wellness services like telehealth and mental health support.
• The company saves $500,000 in payroll taxes annually and uses those savings to invest in wellness programs or fund business growth initiatives, driving employee satisfaction and organizational development.

Example: An e-commerce company with 1,000 employees implemented PHI and saved $1,000,000. The company used the savings to introduce wellness coaching and telehealth services, increasing employee retention by 25% and reducing healthcare claims by 15%.

100-Employee Company

Smaller businesses can also see substantial savings. For a company with 100 employees, the PHI program provides similar benefits:

• Total Employee Benefit: $150,000 in life insurance benefits through Cash Value Whole Life Insurance and wellness services such as telehealth and mental health support.
• Total Employer Savings: The company enjoys $50,000 in FICA tax savings each year, helping reduce costs while providing employees with a more competitive benefits package.

Example: A local retail business with 100 employees adopted PHI and saved $50,000 in payroll taxes annually. The savings allowed the company to offer enhanced mental health services and wellness programs, boosting employee engagement and loyalty.

5,000-Employee Company

For larger businesses with 5,000 employees, the financial impact becomes even more significant:

• The total employee benefit amounts to $7,500,000, with each employee receiving $1,500 through a Cash Value Whole Life Insurance policy and access to telehealth and mental health services.
• The company saves an impressive $2,500,000 in payroll taxes annually and uses those funds to improve employee benefits, launch new initiatives, or drive further business development.

Example: A logistics company with 5,000 employees leveraged the PHI program to save $2.5 million annually. The company reinvested these savings in financial wellness programs and increased healthcare coverage, significantly improving employee retention and job satisfaction.

100,000-Employee Company

For massive enterprises with 100,000 employees, the savings through PHI are monumental:

• Total Employee Benefit: $150,000,000 in employee life insurance and wellness benefits, providing extensive coverage and support to all employees.
• Through the PHI program, the company realizes an annual savings of $50,000,000 in payroll taxes, allowing it to reinvest those funds into large-scale employee development programs or reduce overall operational costs, enhancing both workforce development and efficiency.

Example: A multinational tech company with 100,000 employees implemented PHI and saved $50 million annually. The company used these funds to enhance employee development programs and offer additional healthcare options, leading to a more productive and engaged workforce.

Conclusion:

Businesses of all sizes need help providing competitive, personalized benefits while managing rising costs. The PHI program offers a solution that balances these needs by delivering tax-free employee benefits, saving employers significant payroll taxes. With PHI, HR managers can look forward to enhancing current offerings without increasing complexity or costs, and ultimately, providing their employees with the benefits they deserve.

Now that you've reached this point of the article, why not take the next step? Schedule a Zoom call (here) with the Good Fortune team today. It costs nothing to get an estimate of how much your company can save by applying these tax incentives. Is 30 minutes of your time worth $2,000 per employee in tax incentives? Let us show you how the PHI program from Project Blue can help your business save money while giving your employees the benefits they deserve.

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References:

1. Kaiser Family Foundation, Employer Health Benefits Annual Survey 2019, [KFF Report](Kaiser Family Foundation, Employer Health Benefits Annual Survey 2019)

2. 2020 Employee Benefits Survey, Harvard Business Review, [Survey] (The Most Desirable Employee Benefits by Kerry Jones Harvard Business Review)

3. Small Business HR Challenges with Benefits, [source]Harvard Business Review: Balancing the Company’s Needs and Employee Satisfaction by Ron Carucci

4. Gallup, State of the American Workplace Report, [Gallup Report](In New Workplace, U.S. Employee Engagement Stagnates by Jim Harter)

5. Project Blue, Preventative Health Initiative, [Project Blue FC](https://projectbluefc.com)

6. PHI Tax Savings and Employee Benefits, [Project Blue FC](https://projectbluefc.com)

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