Growing Companies Shrink Turnover By Transforming Benefits From a Cost Center To A Reason To Stay
Employers tend to overthink it. They're looking at it less as a benefit and more as a line item on their expenses.
Saif Akhtar
Co-Founder and COO
SimplyHRA
A growing company watching its budget will almost always file health benefits under costs to minimize. Premiums get compared, the cheapest workable plan gets chosen, and the line gets held. What that framing misses is that benefits are one of the clearest signals a company sends about whether it values the people receiving them, and employees read the signal whether or not leadership means to send one. Companies that treat coverage as an expense to shrink typically wind up in a very different place than companies that treat it as a reason to stay.
Saif Akhtar is the Co-Founder and COO of SimplyHRA, a platform that administers Individual Coverage Health Reimbursement Arrangements, or ICHRAs, for small businesses and multi-state teams. He came to benefits by way of more than a decade building and advising early-stage startups, from co-founding one of San Jose’s first incubators to serving as an early-stage venture investor in Asia and running go-to-market for a string of young companies. That vantage point put him alongside the exact people who feel this tension most acutely: solo HR admins and small-business owners deciding how to cover some of their earliest hires. In his experience, the trouble starts before any plan is chosen, with a company’s outlook.
“Employers tend to overthink it. They’re looking at it less as a benefit and more as a line item on their expenses,” he says. Once the spending is framed that way, the goal narrows to paying as little as defensible, and the decisions that follow optimize for the wrong thing.
The line-item mindset costs more than it saves
Treating benefits as a number to minimize looks disciplined on a spreadsheet, but reads very differently to the workforce. BambooHR’s 2026 Employee Happiness Report found that companies with the highest happiness scores lose 46 percent fewer employees than their unhappiest counterparts. With U.S. employees consistently ranking healthcare as their most valued benefit, its impact on satisfaction and turnover should come as no surprise. The Bamboo report found that among businesses with 25 to 75 employees, those with negative happiness scores shed roughly 19 percentage points more of their workforce each year than their happiest peers. Akhtar’s point is that for a company of that size, the savings squeezed out of a benefits line can be erased several times over by a single avoidable departure.
Multi-state hiring breaks the group-plan model
The line-item habit gets more expensive the moment a company hires across state lines. Group plans are negotiated and locked in at the start of the year, so a new hire in a different state turns into a fresh round of administration. “If you have to hire a brand new employee in a completely different state, it becomes another process and it becomes another admin headache,” Akhtar says. Staggered hiring compounds the problem, since a company adding a few people in a new state may not even meet group-plan participation minimums.
That friction is what a reimbursement model is built to absorb: instead of one negotiated plan, the employer sets an amount and the employee buys their own coverage. “You can even offer an ICHRA to just one employee,” he notes. “It’s very optimized for startups and small businesses right now, but can scale with larger companies.” Employees can be grouped into classes by state, employment type, and number of dependents, so a company can offer more to a key full-time hire and less to part-timers while staying inside the rules.
Handing employees the choice builds trust
Moving from a single company plan to a reimbursement model also changes who makes the coverage decision. Rather than accepting whatever the employer negotiated, each person selects their own medical, dental, and vision coverage. “I then have the choice as the employee to go out to the marketplace myself and find the best coverage that’s suitable for me and my family,” Akhtar says. That autonomy carries a privacy benefit employers tend to underrate, since an employee’s specific plan, carrier, and medical details stay between the worker and the administrator, which some workers prefer. “I may not want to share that with my employer, because there’s that trust factor,” he explains.
The relief runs both directions. “Many administrators do not want to have to get that kind of personal information from their colleagues either. It can become a difficult topic.” Taking that exchange out of the workplace removes an awkward dynamic, which is its own contribution to the positive culture a growing company is trying to build.
The change is smaller than the fear of it
For an HR team of one, the reason to avoid all of this is rarely the economics. It’s the dread of change management, the sense that any benefits overhaul means months of disruption. Akhtar’s counter is that the ongoing burden is lighter than its reputation, with the employee, not the HR lead, doing the work of picking coverage. “Realistically, the admin doesn’t have to spend more than maybe an hour during the setup,” he says.
His practical advice for a team facing its first year-end renewal is to start comparing early. “The best time to compare ICHRA and group plan is starting maybe September, October, because then people are starting to get their renewals for group plans.” The decision he wants leaders to sit with is a budgeting one: “Do I want to deal with this annual increase, or do I want to just set the budget and let people handle it?” There are real nuances to weigh first. An ICHRA offer the IRS deems affordable zeroes out an employee’s premium tax credits, which can land as sticker shock for someone who budgeted against an old premium, so the comparison has to run on each person’s actual numbers rather than the headline reimbursement.
The takeaway is not that every growing company should adopt an ICHRA. It’s that the choice deserves more than a reflexive flinch away from change. For a small company where every exit lands hard and has a tangible impact on morale, treating coverage as a number to shrink versus a reason to stay produces a very different retention outcome. The second option is almost always the cheaper path.
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TL;DR
Saif Akhtar
SimplyHRA
Co-Founder and COO
Co-Founder and COO
A growing company watching its budget will almost always file health benefits under costs to minimize. Premiums get compared, the cheapest workable plan gets chosen, and the line gets held. What that framing misses is that benefits are one of the clearest signals a company sends about whether it values the people receiving them, and employees read the signal whether or not leadership means to send one. Companies that treat coverage as an expense to shrink typically wind up in a very different place than companies that treat it as a reason to stay.
Saif Akhtar is the Co-Founder and COO of SimplyHRA, a platform that administers Individual Coverage Health Reimbursement Arrangements, or ICHRAs, for small businesses and multi-state teams. He came to benefits by way of more than a decade building and advising early-stage startups, from co-founding one of San Jose’s first incubators to serving as an early-stage venture investor in Asia and running go-to-market for a string of young companies. That vantage point put him alongside the exact people who feel this tension most acutely: solo HR admins and small-business owners deciding how to cover some of their earliest hires. In his experience, the trouble starts before any plan is chosen, with a company’s outlook.
“Employers tend to overthink it. They’re looking at it less as a benefit and more as a line item on their expenses,” he says. Once the spending is framed that way, the goal narrows to paying as little as defensible, and the decisions that follow optimize for the wrong thing.
The line-item mindset costs more than it saves
Treating benefits as a number to minimize looks disciplined on a spreadsheet, but reads very differently to the workforce. BambooHR’s 2026 Employee Happiness Report found that companies with the highest happiness scores lose 46 percent fewer employees than their unhappiest counterparts. With U.S. employees consistently ranking healthcare as their most valued benefit, its impact on satisfaction and turnover should come as no surprise. The Bamboo report found that among businesses with 25 to 75 employees, those with negative happiness scores shed roughly 19 percentage points more of their workforce each year than their happiest peers. Akhtar’s point is that for a company of that size, the savings squeezed out of a benefits line can be erased several times over by a single avoidable departure.
Multi-state hiring breaks the group-plan model
The line-item habit gets more expensive the moment a company hires across state lines. Group plans are negotiated and locked in at the start of the year, so a new hire in a different state turns into a fresh round of administration. “If you have to hire a brand new employee in a completely different state, it becomes another process and it becomes another admin headache,” Akhtar says. Staggered hiring compounds the problem, since a company adding a few people in a new state may not even meet group-plan participation minimums.
That friction is what a reimbursement model is built to absorb: instead of one negotiated plan, the employer sets an amount and the employee buys their own coverage. “You can even offer an ICHRA to just one employee,” he notes. “It’s very optimized for startups and small businesses right now, but can scale with larger companies.” Employees can be grouped into classes by state, employment type, and number of dependents, so a company can offer more to a key full-time hire and less to part-timers while staying inside the rules.
Handing employees the choice builds trust
Moving from a single company plan to a reimbursement model also changes who makes the coverage decision. Rather than accepting whatever the employer negotiated, each person selects their own medical, dental, and vision coverage. “I then have the choice as the employee to go out to the marketplace myself and find the best coverage that’s suitable for me and my family,” Akhtar says. That autonomy carries a privacy benefit employers tend to underrate, since an employee’s specific plan, carrier, and medical details stay between the worker and the administrator, which some workers prefer. “I may not want to share that with my employer, because there’s that trust factor,” he explains.
The relief runs both directions. “Many administrators do not want to have to get that kind of personal information from their colleagues either. It can become a difficult topic.” Taking that exchange out of the workplace removes an awkward dynamic, which is its own contribution to the positive culture a growing company is trying to build.
The change is smaller than the fear of it
For an HR team of one, the reason to avoid all of this is rarely the economics. It’s the dread of change management, the sense that any benefits overhaul means months of disruption. Akhtar’s counter is that the ongoing burden is lighter than its reputation, with the employee, not the HR lead, doing the work of picking coverage. “Realistically, the admin doesn’t have to spend more than maybe an hour during the setup,” he says.
His practical advice for a team facing its first year-end renewal is to start comparing early. “The best time to compare ICHRA and group plan is starting maybe September, October, because then people are starting to get their renewals for group plans.” The decision he wants leaders to sit with is a budgeting one: “Do I want to deal with this annual increase, or do I want to just set the budget and let people handle it?” There are real nuances to weigh first. An ICHRA offer the IRS deems affordable zeroes out an employee’s premium tax credits, which can land as sticker shock for someone who budgeted against an old premium, so the comparison has to run on each person’s actual numbers rather than the headline reimbursement.
The takeaway is not that every growing company should adopt an ICHRA. It’s that the choice deserves more than a reflexive flinch away from change. For a small company where every exit lands hard and has a tangible impact on morale, treating coverage as a number to shrink versus a reason to stay produces a very different retention outcome. The second option is almost always the cheaper path.