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June 07, 2019 at 11:18 AM
A new survey of nearly 200 employers with active health savings accounts show these plans are popular, but educating the workforce on HSA plan use is still a big concern.
The Plan Sponsor Council of America’s inaugural survey on HSA design and use found that, when given the chance, more than half of eligible employees enrolled in an HSA-qualifying health plan. The overwhelming majority of these employees opened an account and contributed to it, the PSCA stated in the benchmarking survey, released Tuesday.
The employers’ No. 1 issue, however, is employee education, with 61.4% of survey respondents identifying it as their primary concern. Difficulty of administration, the next highest category of concern, garnered only 15.7%, in comparison. The highest “secondary concern” listed with HSA offerings was compliance, with 30% of respondents zeroing in on it for this category.
“The growth in HSA usage and assets has been explosive, yet this is still a relatively new vehicle that is widely misunderstood,” stated PSCA Executive Director Jack Towarnicky in a release. “These results indicate that plan sponsors have an opportunity to help employees understand how HSAs can be part of a holistic retirement savings plan.”
The results also point to what PSCA calls a “growing convergence of health and retirement savings.”
The majority of respondents spend time educating their employees on allocating assets between their 401(k)/403(b) plan and HSAs. More than three-fourths of organizations provide education at open enrollment, according to the survey. Almost a third of organizations automatically enroll employees in the HSA if they enroll in the HSA-qualifying health option, it found.
