Sometimes companies have trouble meeting their human resources needs, especially while also trying to increase profits. To assist in this area, many companies partner with Professional Employer Organizations (PEOs).
PEO seeks out cost-effective benefits plans. By pooling all of its employees into one group (the vast array of companies hired by the PEO), the organization is able to spread their medical claims over a larger premium base. This equates to a lower annual rate increase, compared to smaller businesses.