By Kevin Marrs, SBAM Approved Partner ASE
According to a survey conducted by Buck Consultants, a Xerox Company, employees who contributed to a Health Savings Account (HSA) were more active in managing their health. In fact, the survey found that 51 percent of respondents set aside more money for potential medical costs than before they had HSAs.
The survey found that 44 percent of participants more actively monitor health care costs. Twenty-nine percent have more discussions with their doctors about the cost of care and 13 percent more actively manage their chronic disease. The survey, the BenefitWallet: 2013 Member Survey Report, also showed that just 17 percent of respondents visited the doctor less when enrolled in the HSA.
For those unfamiliar with HSAs, these are tax-advantaged custodial or trust accounts established by an employer (or individual) for the payment of qualified medical expenses. Both the employer and employee can contribute to these accounts, but the employee controls the account. These plans are also tied to health plans with high deductibles.
The HSAs may be leading to better decisions in terms of health care. “HSA members are making wiser health care decisions,” said Travis Klavohn, Director, Consumer Health Solutions, BenefitWalletTM. “They are evaluating costs more closely before receiving care, shopping for lower priced drugs and choosing less costly services. They attribute their changed behavior to owning an HSA.”
In the survey Buck queried more than 23,000 individual customers of BenefitWallet, the consulting firm’s proprietary HSA product. The survey sought to identify behaviors, opinions and demographics of individuals who own HSAs. A majority of the participants in the study (90 percent) received health coverage through their employers.
Among the survey’s other key findings:
- Most employers (24 percent) contribute $500 – $1,000 annually to the employee’s HSA account. (This is consistent with data from ASE’s surveys that show contributions to HSAs are averaging slightly less than $700. A 2013 EBRI report on HSAs’ employer contributions showed that 51 percent of employers contributed between $200 and $750 in 2012, of which 29 percent contributed $500 to $750 on average. The EBRI report also showed that 39 percent of employers contributed greater than $750. With respect to employer contributions to Family HSAs the EBRI report shows that 63 percent of employers contributed more than $1,000.)
- A majority of those using HSAs (51 percent) primarily see these plans as vehicles to pay for short-term medical expenses. Just 23 percent will use funds for medical care in retirement.
- Thirty-six percent of respondents indicated that they are primarily attracted to HSAs due to cost relative to other plans.
“HSA members’ concern about ACA-driven cost increases aligns with their heightened consumerism, since the top eight out of eleven actions that occurred after enrolling in an HSA involved saving, monitoring costs and shopping wisely,” said Ruth Hunt, a principal and health engagement leader for Buck Consultants. “HSA owners may fear the unknowns that could be out of their control vs. their experience with HSAs. Employers can reassure employees regarding the continued availability of tools and resources: ‘If you like your HSA, you can keep your HSA.’ ”
Recent data from ASE’s 2013/2014 Michigan Policies & Benefits Survey suggest that approximately a quarter of non-unionized employees have access to an HSA either as the primary health plan option or an option among more than one plan.
The American Society of Employers will be conducting its revised health care Insurance benefit survey in the 2nd quarter of 2014.
SBAM members can enroll in an affordable HSA administration program through our partnership with Kushner & Company. Please click here for more information.