Approximately 20% of respondents didn't know that an HSA is portable when losing or leaving a job.Health Savings Accounts are increasingly being positioned as part of a holistic retirement savings approach rather than an account to fund current health care expenses, according to the Plan Sponsor Council of America's (PSCA) 5th Annual Health Savings Account (HSA) survey, which polled more than 500 employers about trends in design and administration as well as participant usage. More than 40% of employers indicated they present HSAs to employees as a retirement savings tool, up by 27% over two years.
|HSA popularity grows
The survey found nearly 90% of eligible employees had an HSA in 2022, and 80% of those reported they contributed to their HSA, up from 72.8% in 2021. The average participant contribution in 2022 was $2,323, a decrease from the past several years, which could be a result of the pandemic and recent economic challenges, according to PSCA.
"Concern for employees being able to fund their HSAs is growing among employers as the economy continues to struggle with higher costs of living, and many are putting supports in place to help," said Hattie Greenan, director of research and communications at PSCA. "Employers see the benefits of HSAs to help employees cover health care expenses now and in the future and are structuring their programs to help employees do so."
|Borrowing 401(k) strategies
Half of employers said it is a challenge to get employees to open an HSA after enrolling in a qualifying health plan, and they are leveraging successful strategies developed in the retirement savings space to encourage HSA participation, according to the survey, which was sponsored by HSA Bank. Among the strategies employers are using to address this challenge is automatically enrolling eligible employees into HSA plans. Nearly half (46%) of organizations reported they are using HSA auto-enrollment, a 30% increase in just two years.
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