According to the Kaiser Family Foundation, the average annual premium for employer-sponsored family health insurance coverage has risen over 50% in the last 10 years. And in the same time frame, the average employee contribution to that annual premium has increased over 70%.
As health insurance costs continue to rise, employers are seeking out ways to provide high-quality care while also reining in cost for employees. Many are turning to HSA-qualified health plans — plans that allow eligible employees to open health savings accounts (HSAs) and save money by paying for medical expenses tax-free. HSAs have more tax advantages than a 401(k) and don’t have use-it-or-lose-it limits like a flexible spending account, making them the best way to save for health care costs.
In addition, HSA-qualified plans typically have lower monthly premiums than traditional plans. Rather than paying more each month for coverage they may not utilize, HSA-qualified plans allow employees to own their health and take a more active role in their medical consumption. And employees are taking advantage; the 2019 Consumer Engagement in Health Care Survey found that employees covered under HSA-qualified plans were more likely to check medical prices, ask for generic drugs instead of brand names, and use online cost-tracking tools.
For these reasons, employers are increasingly encouraging their employees to enroll in HSA-qualified plans, open HSAs, and be engaged health care consumers.
If you are already setting up employer-sponsored HSA programs, you probably know all about strategies for maximizing employee engagement.
If not, here are three things to tell employer clients about how they can nudge employees onto HSA-qualified health plans:
1. Make sure the health plan is HSA-qualified.
This might seem like a no-brainer, but it’s worth mentioning. While the terms “high-deductible health plan” (HDHP) and “HSA-qualified health plan” are often used interchangeably, not all HDHPs are HSA-qualified plans. In fact, according to 2018 data from the National Center for Health Statistics, over 25% of individuals with private health insurance were enrolled in HDHPs without an HSA option.
Agents, don’t let this be your clients. Offering employees an HDHP that isn’t HSA-qualified is like having a PB&J without the bread: It’s messy and far less palatable. Your clients’ employees will find it much easier to own their health if they can take advantage of the unparalleled tax savings HSAs provide.
Once that’s covered, the next step is choosing an HSA provider to partner with.