Zenefits Releases Benchmark Report on SMB Benefits in United States

Report highlights trends, costs and benefits choices of more than 8,000 businesses

(Graphic: Business Wire)

SAN FRANCISCO--()--Zenefits, the leading all-in-one HR solution for small and medium businesses, today released Zenefits Small Business Benefits Benchmark Report, a snapshot of the U.S. small business benefit landscape. Based on aggregate data from more than 8,000 Zenefits customers, the report examines how plan types, contributions, premiums, deductibles, copays and out-of-pocket costs differ across regions. The study is intended to help businesses make more informed decisions by providing insights into the choices of similar companies within the same region.

Employee benefits are a significant investment for any business and can impact a company’s ability to recruit and maintain the best talent. Yet, it can be difficult to navigate the complex options and provide a benefits package that is both good for employees, as well as the business. Now business leaders are facing increasing uncertainty – between the new administration, proposed changes to the Affordable Care Act (ACA), and changing state regulations. We hope the findings in our first benchmark report can help business owners make better decisions as they navigate the complexity of employee benefits,” said Jay Fulcher, CEO of Zenefits.

Highlights from the report include:

Employers Contribute Nearly 25% More than Required to Monthly Premiums

While there is some diversity in the number of healthcare plans offered based on company size (larger companies typically have more offerings), small businesses consistently contribute more than required to employer-sponsored health insurance. When deciding what to contribute, small businesses typically consider talent acquisition and retention, pre-tax considerations, and benefits packages.

  • Average premiums: $465/month for individuals and $1,168/month for families
    • Premium costs are lowest in the Central region and highest in the Northeast
  • Companies contribute an average of 73% toward individual premiums (nearly 25% more than required) and 38% toward dependent premiums
    • West Coast employers contribute the most toward individual premiums (80%)
    • Northeast employers contribute the most toward dependent premiums (43%)
  • More information on contributions can be found in the full report

Great employers tend to give employees options, and they often contribute generously. They are working hard to help employees find the best possible benefits programs for their families,” said Josh Bersin, principal and founder, Bersin by Deloitte, Deloitte Consulting LLP. “Even if healthcare costs increase, the social contract between many employers and employees remains strong: employers of all sizes continue to contribute significantly to their employees' healthcare benefits.”

PPOs Dominate All U.S. Regions Despite Higher Costs

PPOs (Preferred Provider Organization) remain the most popular plan type for small businesses across the country, accounting for 49% of plans. Many choose PPOs despite the higher cost because they provide more flexibility in provider access, movement of care, network size, and out-of-network coverage. However, there is significant variation based on region: PPOs are more popular in Central states, accounting for 58% of PPO plans, while in the Northeast, PPOs only account for 35% of plans. These variations are perhaps based on lower average population density and/or different network providers: important considerations for small businesses to take into account when adopting a benefits package.

Deductibles Increasing, but Out-of-Pocket (OOP) Stabilizing

While deductibles are a key indicator when evaluating health care plans, changes in policy, including the ACA cap on out-of-pocket costs, have made OOP expenses a more prominent consideration, especially as deductibles continue to increase. Average deductibles and OOP costs vary significantly by region and generally have an inverse relationship. The Central region has the highest average deductibles, but they also have the lowest OOP limits. In contrast, the West has the lowest average deductibles, but the highest OOP limits. For small businesses, this means location and relationship between deductible and OOP are important indicators for employer-sponsored benefits.


  • Average Deductible (Individual): $1,650
  • Average Deductible (Family): $3,520
  • Highest in Central region and lowest in West region (Individual and Family)
  • For detailed cost structure, see full report

Out-of-Pocket Costs:

  • Average OOP (Individual): $4,825
  • Average OOP (Family): $9,780
  • Highest in West region and lowest in Central (Individual) and Southeast (Family)
  • For detailed cost structure, see full report

Zenefits’ Small Business Benefits Benchmark Report is based on aggregate data from more than 8,000 businesses - providing a snapshot of small business benefits in the U.S. To download the full report, visit www.zenefits.com/get/benefits-benchmarking-report/.

About Zenefits

Zenefits is the leading all-in-one HCM (human capital management) solution for small and medium businesses. Designed as an interconnected ecosystem of apps, Zenefits delivers the most complete HR experience by combining its own powerful apps with dozens of best-of-breed providers on the Zenefits platform. Built on a modern technology stack, Zenefits’ platform provides a comprehensive Employee Record tightly integrated with Zenefits’ apps like onboarding, payroll, compliance and benefits administration and partner apps like email, expense management, 401(k) and employee engagement. The result is a powerful HCM solution that helps mid-market businesses manage their people, stay compliant and save thousands of hours in lost time. For more information, visit www.zenefits.com.


Kevin Young


Kevin Young