HSAs are increasingly gaining traction in the workplace — but primarily for the youngest members of the workforce, a new report from Benefitfocus shows. Millennials continued to adopt HDHPs at a higher rate than other generations, especially those under the age of 26, whose election rate rose from 41 percent in 2016 to 45 percent in 2017. The report also identified millennials as investing 20 percent more of their salary into their HSAs than any other generation.
Despite year-over-year increases between 2014 and 2016 in the number of U.S. workers enrolled in an HDHP with a savings component, 63 percent of employees don’t know the benefits of an HSA, and nearly one in three feel no better today about managing their health care finances than when they first got health care on their own, a survey from Alegeus finds. Only 23 percent save beyond the current year and the majority under-fund their health care savings each year.
Is Congress About to Supersize Your Health Savings Account?
President Donald Trump and Republicans in Congress have Obamacare squarely in their sights, with plans to repeal and replace the landmark health care reform legislation. One intriguing proposal could provide a huge boost to your retirement savings efforts. Most proposed fixes to the ACA include a big increase in the amount individuals and families can contribute tax-free to their HSAs.
Even if there are dramatic changes in regulations and taxes, the basic foundations of employer-based health benefits are not likely to be challenged. And rising costs will still be a problem — which is why it's important employers continue to keep an eye out for new innovations while continuing to adopt strategies that have proven effective in containing the rise of health costs. The movement toward HDHPs with HSAs and HRAs continues to be very strong, according to industry experts.
A Health Savings Account Could Power Your Retirement
A key tenet of President-elect Donald Trump’s stated health-care plan is to expand access to health savings accounts, but there’s already a growing trend among employers to move employees to high-deductible insurance plans. That means consumers need to understand both those insurance plans and the pros and cons of health savings accounts.