External HR Support Can Help Small and Midsize Businesses Manage Rising Benefits Costs and Compliance Complexity

Healthcare costs are surging, and compliance landscapes are growing more complex across state lines. HR professionals are forced to rethink how they support both their people and their business strategy. Rising benefits costs, multi-state compliance, and talent retention pressures have converged to make HR one of the most critical and complex functions for small and mid-sized companies in 2025.

How can small and midsize companies remain compliant, cost-effective, and people-focused amid rising benefits costs and a rapidly shifting regulatory environment?

At this year’s HR Southwest Conference(HRSWC), MarketScale’s Daniel Litwin, the voice of B2B, sat down with Jake Reedy, a Sales Consultant at TriNet, a Professional Employer Organization (PEO) that supports small and mid-sized businesses in managing HR complexity at scale. Reedy shared how data-driven technology and strategic partnerships are redefining how growing companies approach compliance, benefits, and workforce management.

Key Takeaways 

• Healthcare Costs Are Soaring Again — After years of stability during the pandemic, health insurance renewals have spiked as small businesses grapple with sharply rising premiums. The so-called “pickleball effect,” as Reedy describes, has driven up post-pandemic healthcare utilization and costs.

• Small Businesses Need Creative Benefits Strategies — With rising costs squeezing margins, small and mid-sized firms must get creative in their benefits offerings. Partnering with a PEO like TriNet allows access to pooled buying power and benchmarked rates that can significantly reduce overhead.

• HR’s Role Is Shifting Toward Mediation and Expertise — While finance teams feel the brunt of benefits inflation, HR departments are expected to be the “experts”  answering employee questions and navigating complex plan structures. PEOs relieve this burden by offering certified HR and benefits professionals who handle that expertise in-house.

• Compliance Complexity Is at an All-Time High — For growing companies expanding across multiple states, compliance is becoming unmanageable internally. Reedy emphasizes that it’s “not your job to refresh Texas or California state laws daily.” Instead, outsourcing this to a PEO ensures coverage across ever-changing local and federal regulations.

• Data and Scale Create Smarter HR Decisions — With a client base of over 360,000 employees, TriNet leverages data from similar organizations to provide predictive reporting, benchmarking, and insights. Their platform “learns” from usage, helping HR leaders make data-driven decisions faster and with more accuracy.

Jake Reedy is a sales consultant at TriNet, a Professional Employer Organization (PEO) that supports small and mid-sized businesses with workforce, benefits, and compliance management. He specializes in full-cycle business development, combining strategic outreach, relationship building, and consultative selling to help organizations streamline their HR operations. Reedy established a record of exceeding performance goals and mentoring peers in effective prospecting and client engagement strategies.

Article written by Sonia Gossai