Demography, Regulation and Fringe Benefits

By John Greenbaum, Employee Benefits Practice Leader

Demography, Regulation and Fringe Benefits

Risk Strategies recently announced the acquisition of FBA National, a firm primarily focused on benefits administration and tailoring benefit packages for clients complying with wage parity, living wage, and similar requirements such as prevailing wage rules for government contractors.

As a practical matter, the FBA National acquisition is a nice fit for our national Employee Benefits practice. Like our 2016 acquisition of TSG Financial they are headquartered on Long Island and are also a regional market leader in serving clients in the home health care industry

But the acquisition of FBA National is about much more than a shared territory and market focus. We see this as a demographics and regulatory-driven strategic addition to our employee benefits practice capabilities.

Our country’s national demographic, driven in no small part by the Baby Boomers, is skewing towards an aging population. It’s a demographic trend that will play out over decades and will, in turn, drive significant growth in the home healthcare market. There are dynamics at work that we can all relate to. As anyone with aging parents has seen, our parents want to remain in their own homes for as long as possible. While the growth of congregate elder housing has been substantial, the availability and expense of this option will limit its widespread adoption. On balance, the cost of taking care of infirm seniors is lower in a home setting, and the primary payers, Medicare and Medicaid, know this.

As home health care companies grow across the country, they will encounter a changing regulatory landscape that will affect all manner of businesses. Government and other municipal entities will seek to provide protection and financial stability to low wage health care workers through the enactment of living wage rules and similar regulatory structures.

Fringe benefits programs are an increasingly common feature in markets where wage parity regulations as well as government contractors operate. They can help organizations both control costs and satisfy complex, detailed wage-related regulations at the state or federal level. FBA National’s expertise and services allow companies to effectively tailor fringe benefits to meet cost and regulatory compliance goals, while avoiding administrative burdens that could increase costs and frustrate employees.

Helping businesses, including home health care providers, understand the nuances and requirements of these regulatory structures will be vital for any broker offering Employee Benefits services. With FBA’s capabilities, we have the expertise at hand to help existing clients deal with this evolving regulatory environment as well as open new possibilities for our practice.

Just as importantly, as companies incorporate a more sophisticated approach to delivering the benefits employees need, it becomes increasingly important for us to provide turn-key solutions for those companies seeking to enable these offerings. FBA’s administrative service model allows us to meet that imperative with in-house, rather than outsourced, capabilities for a variety of benefit services. Many client’s augment the value of their core health plans with Health Reimbursement Arrangements (HRA’s), Flexible Spending Accounts (FSA’s) and Health Savings Accounts (HSA’s). FBA adopted market leading technology to manage these plans, giving us increased speed-to-market and flexibility so we can provide greater value to all of the stakeholders in this value chain.

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