Are older Americans using HSAs, FSAs or HRAs?

Older Americans are concerned about increasing health care costs. Tax-advantaged options such as Health Savings Accounts, Flexible Spending Accounts and Health Reimbursement Arrangements may be part of the solution.

The University of Michigan National Poll on Healthy Aging asked adults from 50 to 80 about affording needed health care in the future and their saving for health care. During 2020:

• 13 percent delayed seeking medical care because of worry about the cost.
• 12 percent needed medical care but didn’t get it because they couldn’t afford it.
• 15 percent had problems paying medical, dental or other health-care bills.

Nearly one in five were not at all confident they would have enough money to pay for health care in the next year.

Overall, 7 percent of adults ages 50–80 had an HSA:

• This was more common among individuals age 50 to 64 compared to those age 65 to 80 (12 percent vs. 1 percent),
• individuals with at least a bachelor’s degree compared to a high school education or less (13 percent vs. 3 percent)
• individuals with an annual household income of at least $100,000 compared to less than $30,000 (13 percent vs. 2 percent)
• and individuals who reported their physical health as being excellent, very good or good compared to physical health being fair or poor (8 percent vs. 3 percent).

Fewer than one in eight adults in that age range reported having an FSA:

• Having an FSA was more common among individuals 50 to 64 compared to 65 to 80 (17 percent vs. 4 percent),
• individuals with at least a bachelor’s degree compared to a high school education or less (18 percent vs. 8 percent)
• and individuals with an annual household income of at least $100,000 compared to less than $30,000 (22 percent vs. 2 percent).

Just 5 percent of adults between 50 and 80 reported having an HRA:

• This was more common among individuals with at least a bachelor’s degree compared to a high school education or less (6 percent vs. 3 percent),
• individuals with an annual household income of at least $100,000 compared to less than $30,000 (7 percent vs. 2 percent)
• and individuals who reported their physical health as being excellent, very good or good compared to physical health being fair or poor (5 percent vs. 2 percent)

“As health-care costs continue to rise, helping more older adults — especially those with greater health needs — save for health-care expenses is one important way to ensure they will be able to access and pay for the care they need, both now and in the future,” the report concluded.

READ MORE:

• The importance of HSAs in saving for future health care needs can’t be underestimated
• An uneven year for HSA spending: Doctor visits down, prescription costs up
• HSAs and the employer’s role in the development of an equitable plan environment