For the first time, employers cited employee education and engagement as the most important service they want from a vendor in support of their HSA programs, according to the Plan Sponsor Council of America’s 2024 HSA Survey. Previously, the availability of an HSA debit card was the top priority of employers.
Although the majority of organizations educate their employees about HSAs during open enrollment, they are hoping to provide education more frequently, the report said. The top topic employers want to talk more to their employees about is the tax benefits of HSAs.
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This push for education comes at a time when employee contributions to HSAs were up slightly last year as were HSA account balances, despite increased concerns about employees being able to fund their accounts.
HSAs are still predominantly viewed by employees as a spending account to meet current needs despite their value as a retirement health care spending account, the report said. Only about one-third of employers emphasize the retirement benefits of HSAs, and less than 30% enable participants to include their HSA balances alongside their retirement accounts for a holistic view of total savings.
“Consumers don’t always realize the powerful tax advantages HSAs provide in supporting costly health care expenses,” said Ann Brisk, senior director of innovation and strategy at HSA Bank. “This research emphasized the need for employers and their providers to bolster efforts in educating employees about using HSAs for medical expenses now and in the future so they will fund it as much as possible.”
PSCA’s sixth annual HSA survey, sponsored by HSA Bank, was conducted in the summer of 2024 and reflects responses from more than 500 employers that provide an HSA program for employees.
The survey found nine out of 10 eligible employees had an HSA last year, and three-quarters of participants were contributing. The average participant contribution was $2,609, up from $2,323 the previous year, and the average account balance at the end of 2023 was $6,165, up from $6,130 in 2022.
Three-quarters of employers contribute to HSAs, with most providing a set amount per health plan coverage level. About 40% of organizations have implemented automatic enrollment in their HSA program if employees enroll in qualifying health options.
The percentage of organizations offering investment options for HSA contributions was about 66%, up from 60% the year before. However, only 18% of employees elect to use investments for their HSA balances. That accounts for about one-quarter of all HSA assets.
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