Mental health benefits & retirement readiness weigh on Americans: How employers can help
Employers have a significant role to play in providing the necessary tools, resources, and education to navigate these financial pressures, ultimately improving decision-making in both areas of health and wealth, says a new survey.
HSA Bank’s Health and Wealth Index has been released, surveying roughly 2,000 health care consumers. The survey found that mental health benefits and retirement assistance were among the greatest concerns for consumers given recent economic trends.
“Financial pressures are driving increases in healthcare costs which impact enrollment,” said Chad Wilkins, President of HSA Bank, which conducted the survey. “Concurrently, we’re observing increased demand for mental health services, and an undeniable concern over retirement preparedness, exacerbated by a lack of savings. Employers have a significant role to play in providing the necessary tools, resources, and education to navigate these realities, ultimately improving decision-making in both areas of health and wealth.”
As health care affordability and medical debt garner more attention from policymakers, health care costs weigh heavily on the minds of consumers.
With a greater focus on mental health care, employers are recognizing the needs of their employees to better support their mental health. Coverage of mental health care has increased to 27% of employers from 23% last year. As an IRS-qualified expense, employers can offer HSAs, FSAs and HRAs to help cover mental health care.
Most popular services for 2023:
- Annual exam (58%)
- Flu shot (49%)
- Dental exam (48%)
- Health assessment (40%)
- Recommended preventive care exams (31%)
With inflation on the rise, better understanding of health care costs is crucial. Employers can provide more education during open enrollment and throughout the year.
The HSA Bank Open Enrollment Resource Center offers resources on:
- Health Savings Accounts (HSA)
- Flexible Spending Accounts (FSA)
- Lifestyle Spending Accounts (LSA)
These resources can help employees understand how to use their benefits and plan for health care expenses throughout the year. Health care costs remain the primary reason for those who are not enrolled in a health plan. Of those who are not currently enrolled in a health plan, 51% said it was due to cost.
Retirement readiness continues to a challenge, with 44% of respondents reporting that inflation has affected their ability to save for retirement. It is estimated that a 65-year-old couple retiring today will spend hundreds of thousands of dollars on health care alone. Factor in inflation and what employees are saving may not be enough for their future expenses.
Related: Importance of HSAs & LSAs: A Q&A with Lindsay Barnard and Duke Janssen
Traditional retirement accounts like a 401(k), 403(b) or IRA may need to be supplemented to create a sufficient nest egg. Many employees are complementing employer-sponsored retirement accounts with HSA investment accounts. A whopping 70% of respondents agree that they made changes, such as creating a budget, paying off debt, funding emergency savings, and investing, to improve wealth and finances for their employees in the past year.
Additional retirement options offered by HSA Bank:
- HSA – savings for health care expenses in retirement, tax advantages and funds that roll over
- Retirement Reimbursement Arrangement – employers help retirees offset health care costs in retirement with tax-free dollars
- Tuition Reimbursement Account – covers some costs like schooling that could result in debt