How a Small Business Saved $20,000 a Year on Employee Benefits
A two-month benefits review saved a Canadian small business $20,000 annually compared with its previous plan, while adding flexibility and a health spending account.
The business already had a benefits broker. When its renewal approached, the owner initially felt the review was covered.
As the company’s fractional HR provider, A&A Consulting asked to take a closer look.
The existing plan offered extensive coverage, but its cost had become difficult to sustain. The proposed renewal would increase that expense further. The owner wanted to bring costs under control while continuing to look after employees.
A&A reviewed plan utilization, surveyed the team, and worked with the existing broker to develop a benefits package that better reflected employee needs and the company’s budget.
Company profile | Details |
Client | Confidential |
Industry | Technology |
Operations | Canada and the United States |
Team size | Approximately 30 employees |
This case study is shared anonymously to protect client confidentiality. Additional project details and client references may be provided during the proposal stage, subject to client permission.
In this article
The challenge: a generous plan with an increasingly difficult price tag
Employee benefits were a significant expense for the business.
The existing package included extensive coverage and flexibility, but some features were receiving little or no use. Other areas were contributing disproportionately to costs.
The upcoming renewal made the situation more pressing. Continuing with the proposed pricing would mean a substantial increase in an expense the owner already considered high.
Simply cutting benefits was not the outcome the business wanted. Employees valued their coverage, and the owner wanted to preserve a meaningful plan.
The question was how to make the investment more sustainable while directing coverage toward what mattered most to the team.
The approach: understand employee needs before changing the plan
Review costs and utilization
A&A examined the existing plan, utilization information, and proposed renewal.
This helped identify where the business was paying for features that were not being used and where cost-containment measures could make a meaningful difference.
The review went beyond the total premium. It considered how the plan’s design aligned with the way employees actually used their benefits.
Ask employees what mattered
Before recommending changes, A&A surveyed the team.
Utilization information showed what employees had used. The survey helped establish what they valued and wanted from their coverage.
Together, those inputs provided a stronger basis for deciding which features to preserve, where additional flexibility would help, and which little-used provisions could be reduced or removed.
Work with the existing broker
A&A worked with the company’s broker to develop and refine the revised plan.
The broker brought benefits-market expertise. A&A brought knowledge of the workforce, employee feedback, and the company’s financial priorities.
Several rounds of discussion helped move the proposal toward a package that balanced meaningful coverage with an affordable ongoing cost.
Redirect coverage and introduce cost controls
The revised package retained comparable overall coverage while changing how some benefits were structured.
Changes included:
Greater flexibility in paramedical coverage.
A small health spending account, giving employees another way to address eligible expenses.
Reductions or removal of some provisions that were receiving little or no use.
Prescription drug cost controls, including generic substitution provisions and measures addressing certain high-cost medications.
There were trade-offs. Employees had less flexibility in some prescription drug provisions, while gaining flexibility and support elsewhere.
The result was a plan better aligned with the team’s needs and the business’s ability to sustain it.
The results: lower costs and a benefits package employees valued
$20,000 in annual savings against the previous plan
The revised plan cost $20,000 less per year than the business had previously been paying.
That was a reduction from its existing annual expense, rather than simply avoiding a proposed increase.
Approximately $40,000 below the proposed renewal
Because the renewal would have raised costs further, the revised package was approximately $40,000 less per year than the proposed renewal pricing.
Comparison | Annual difference |
Revised plan versus previous annual cost | $20,000 lower |
Revised plan versus proposed renewal | Approximately $40,000 lower |
More flexibility in areas employees valued
Employees retained comparable overall coverage, gained more flexibility in paramedical benefits, and received a small health spending account.
The revised package expanded coverage options for much of the team, while introducing targeted cost controls elsewhere.
Employee response was positive, and the owner was pleased to bring a significant budget item under better control.
A focused, two-month project
The work took approximately two months, covering the cost and utilization review, employee survey, and plan development with the broker.
It was a focused project within the broader fractional HR relationship, with a measurable annual financial result.
What other small businesses can learn
A benefits renewal is an opportunity to review whether the plan still fits your business and your employees.
This engagement highlights four practical steps:
Review utilization alongside pricing. A premium increase alone does not explain which parts of the plan deserve attention.
Ask employees before making changes. What they value may differ from what the existing package emphasizes.
Consider the whole package. Flexibility, health spending accounts, and targeted cost controls can change the value employees receive.
Bring HR and the broker together. Workforce insight and benefits expertise can help shape a more suitable plan.
For this business, the review created room in the budget while preserving a benefits package employees appreciated.
Is your benefits renewal putting pressure on your budget?
A&A Consulting helps small businesses review their people costs, understand employee needs, and work with benefits providers to develop practical options.
Through our fractional HR support, we help connect people decisions with the needs of your business.
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