Consumers' HSA balances total $61.7B
The collective balance of HSA accounts has increased 20 percent over the last year.
Are consumers finally catching on to the “savings” aspect of health savings accounts? Based on the results of the 2019 Midyear Devenir HSA Research Report, maybe.
At June 30, the amount of assets within such accounts rose 20 percent, $61.7 billion, from June 2018, according to data collected primarily from the top 100 HSA providers. The total number of accounts during that period rose 12 percent, to 26.26 million.
Related: HSAs: Moving from spending to saving to strategizing
Investment assets within HSAs rose 35 percent, to $13.3 billion, thanks to “strong market tailwinds,” according to the report. Account holders with investment assets have a total deposit and investment account balance of $15,982, on average. At June 30, 22 percent of all HSA assets are in investments, and there are now more than one million accounts that are investing a portion of their HSA dollars — a little more than 4 percent of all accounts.
Total HSA contributions also continue to rise, increasing 12 percent, to $22 billion. Health plan partnerships were the leading driver of new account growth in the first half of 2019, accounting for 42 percent of new accounts opened.
“Devenir’s latest survey shows that with health care costs rising on the whole, more Americans are finding HSAs to be the best option to save for their health care needs,” says Shobin Uralil, co-founder and COO of HSA provider Lively. “Contribution numbers are increasing year over year, and for the first time, over one million accounts are investing their HSA dollars. As more HSA providers increase investment education, access and remove fees, we expect this number to accelerate.”
For all of 2019, survey respondents are projecting 16 percent asset growth across the industry, while expecting their own growth to be 24 percent, on average.
“In previous surveys, HSA providers have been fairly accurate with their growth forecasts, demonstrating an impressive understanding of the outlook for their book of business,” the authors write. “Devenir currently projects that the HSA market will approach $88 billion in HSA assets by the end of 2021, held by over 30 million accounts.”
Other key findings include:
- Devenir continues to see seasonality in the percentage of accounts that are unfunded. Accounts are often opened during the fall open enrollment season, but remain unfunded until early the following year. Halfway through 2019, about 15 percent of all accounts were unfunded, similar to a year ago.
- A third (31 percent) of all HSA dollars contributed to an account came from an employer. For those employers making contributions, the average amount was $648. Just over half (52 percent) came from an employee. For those employees making contributions, the average amount was $1,121.
- Thirteen percent of all HSA dollars contributed to an account came from an individual account not associated with an employer. For those making contributions from these sources, the average individual contribution was $1,546.
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