HSAs are an opportunity in a volatile economy
Employee financial stress is expected to increase. Financial benefits help.
In this volatile economic environment, it’s no surprise that employee financial stress is on the rise.
As inflation and increasing prices are still a major factor in the United States, HR leaders expect health insurance costs to rise in the next year. But within this landscape, benefits, especially Health Savings Accounts, are critical tools to help employees and employers save money and combat stress.
Costs and financial stress are rising.
Health and wellness benefits are a critical offering to help combat financial stress.
of benefits leaders say offering competitive financial benefits is more important than a year ago.
These benefits are especially important for employee retention. This response remains consistent over the past three years.
of benefits leaders expect that HSAs and paid time off will be the most important benefits for their team in the next year.
expect health insurance costs to increase between 10 and 35% in the next year.
38% expect costs to increase between 10 and 20%, but a full quarter expect these costs to increase between 21 and 35%. No one expects costs to decrease.
say they expect enrollment in high deductible health plans to increase over the next year.
These health plans often have the lowest premiums and can help both companies and their employees save on healthcare.
say that employee financial stress is on the rise.
Benefits leaders feel financial stress is increasing more than stress around healthcare costs, which 33% say are on the rise.
Companies rely on benefits to help them maintain a productive workforce, rewarding employees, ease employee stress, and support company goals.
They need their financial institution to help them achieve these objectives.
55% of companies offer benefits to maintain a healthy, productive workforce and/or to reward employees for hard work.
50% offer benefits to ease employee stress and/or to support company culture goals, including diversity, equity, and inclusion.
Base pay and benefits, both tax-advantaged and post-tax, help combat stress and fuel employee recruitment and retention.
50% of benefits leaders say that health insurance is the most important benefit for employee recruitment and retention, followed by bonuses, 401(k) matches, and paid time off at 30%.
47% of employees are asking for increased base pay and 44% are asking for bonuses due to rising prices, while about 40% of employees also want better healthcare, HSAs or FSAs, and 401(k) matching.
Flexible employee benefits, both pre- and post-tax help drive employee retention, while helping employees save money and combat financial stress.
HSAs are the most popular of all these benefits.
78% offer Health Savings Accounts (HSAs).
64% offer Health Reimbursements Arrangements (HRAs).
54% offer Flexible Spending Accounts (FSAs).
44% offer Lifestyle Spending Accounts (LSAs).
24% offer commuter benefits.
Capture more commercial customers and grow deposits with the right HSA partner
of the HSA market is made up of employer-sponsored acounts.
With health insurance prices and employee financial stress increasing, companies are turning to health insurance plans and financial benefits that offer employees clear financial support and add money to their pockets. To be successful, they need a strong partnership with their financial institution.
A popular solution is offering a High Deductible Health Plan (HDHP), which often offers the lowest premiums for both employers and their employees. According to a Value Penguin survey, over 53% of private employers offer these plans. Lively found that 62% of benefits decision makers believe enrollment in these plans will increase in the next year. This means that the number of your customers offering these plans, and their enrolled employees, is not only incredibly significant today, but will also increase further in the future. These plans are compatible with Health Savings accounts, a tax-advantaged savings account for healthcare expenses, which are a popular strategy to help offset the high deductibles that correspond to these plans. HSAs are high-balance, high-retention accounts that drive stability and growth for financial institutions. HSAs are owned by the account holder, allowing them to grow their balance over time. According to Devenir, as of 2023 there are over 37 million accounts with over $123 billion in assets. Employer-sponsored HSAs make up 60% of the HSA market, so focusing on capturing the commercial HSA market can ensure your balances grow even faster. Offering an HSA enables financial institutions to:
- Drive new retail and commercial customers to their financial institution.
- Grow their core deposit base and generate revenue through interchange and fixed-fee income.
- Retain and increase deposits from current customers that may be offering an HSA solution through a competitor or another provider.
- Differentiate themselves against competing financial institutions.