Recruiting and Retention: What you need to know about LSAs
TRI-AD’s health and wealth solutions allow employers to create a truly customized benefit offering, helping recruit and retain top talent in a competitive market. Lifestyle Spending Accounts (LSAs) are still a hot topic in the post-pandemic/post-Great Resignation era. An LSA is an employer-sponsored benefit that allows organizations to reimburse employees for various expenses. These plans can be used for specific expenses like health and wellness expenses typically not covered under a group health plan, to fill a gap in a benefits package like pet care, tuition repayment, or financial planning, or even pay for concert tickets, spa treatments, and meal delivery services. Employers have tremendous flexibility when choosing eligible expenses and can establish employee levels for tiered benefit amounts.
LSAs can help with recruitment, retention, and productivity. Most importantly, they can help workers feel more satisfied with their jobs. According to the National Institutes of Health, over 50% of employees express that quality of life is more important than financial incentives—a significant shift in priorities from just a decade ago. In contrast with traditional Wellness Plans, LSAs can demonstrate support for work/life balance, an inclusive company culture, empathic leadership, and concern for physical, mental, and emotional well-being. Because this program typically involves reimbursement on a taxable basis, employers have the freedom to be creative with plan designs.
Employers control their LSA’s plan design. They can choose:
• Eligible expenses
• Benefit dollar allocation, funding frequency, plan year dates
• Eligible populations or tiers
Here are a few things of note regarding LSAs:
• They cannot cover any medical expense that is covered by health insurance or another type of tax-exempt benefit
• LSAs typically are a taxable benefit
• There are no annual limits on employer contributions
Our team will collaborate to customize an LSA program that meets employees’ needs and organizational goals. Our administration capabilities make it fast, simple, and easy to manage these benefits and for employees to utilize them.
The TRI-AD LSA allows employers to direct funds towards a benefit that meaningfully impacts their employees’ quality of life. Eligible expenses can be narrow or broad and may include emotional health needs, professional and educational development programs, and travel and entertainment elements. Employers can design an LSA to positively impact their population and help retain and attract top talent.
If you are a TRI-AD client and want to learn more about Lifestyle Spending Accounts, do not hesitate to contact your Client Services Manager.
TRI-AD and our Associates’ suggestions or recommendations shall not constitute legal advice. No content on our website can be construed as tax or legal advice and TRI-AD may not be considered your legal counsel or tax advisor. Clients are encouraged to consult with their tax advisor and/or attorney to determine their legal rights, responsibilities, and liabilities. This includes the interpretation of any statute or regulation, federal, state, or local; and/or its application to the clients’ business activities.