Subscribe to Devenir’s monthly newsletter and stay up to date with the latest HSA news! Each month Devenir highlights a selection of articles to keep you in the know of the latest trends and developments in the HSA marketplace.
A summary of the articles included in the August 2023 edition:
- New Survey: Health Savings Accounts Cover Record Number of Americans in 2022
- Rethinking FSAs and HSAs to Drive Benefits Participation & Employer Savings
- Do Spouses Always Inherit HSAs Tax-free? Not Without Planning!
- California Representatives Want the State to End Tax on Health Savings Plans
- What Is an HSA and How Can You Get the Most Out of Yours?
- Podcast: The Mainstreaming of Health Savings Accounts
New Survey: Health Savings Accounts Cover Record Number of Americans in 2022
Devenir and the American Bankers Association’s Health Savings Account Council released the results of the 3rd annual Devenir & HSA Council Demographic Survey and resulting research report. The survey found that the 35.5 million health savings accounts that existed at the end of 2022 helped cover a record number Americans at almost 72 million, a 6.5% increase from 2021.
Rethinking FSAs and HSAs to Drive Benefits Participation & Employer Savings
When it comes to employee benefit plans, FSAs and HSAs are table stakes for most employers. Even though 60% of employers offer an HSA and 62% offer an FSA, these accounts are rarely the star of the show when it comes to employee communications. And this oversight and lack of focus can lead to missed opportunities for employees, employer sponsors, and the brokers and TPAs that help employers manage these plans. Fortunately, there is still time to right the ship and improve employer outcomes and the employee experience before open enrollment.
That starts with clearly communicating the advantages of pairing an FSA or HSA with the employer’s health plan.
Do Spouses Always Inherit HSAs Tax-free? Not Without Planning!
Federal tax law allows a Health Savings Account owner to pass an account to a spouse on the owner’s death. But it’s not automatic.
It’s a topic that few people want to face: their own death. But it’s important because making decisions about the treatment of health savings account balances after death can mean savings of thousands of dollars in current and future taxes.
California Representatives Want the State to End Tax on Health Savings Plans
California Republican members of Congress want the state to kill its tax on health savings accounts.
Led by Rep. Michelle Steel, R-Seal Beach, six Republican members of California’s congressional delegation, including Rep. Young Kim, sent a letter to Gov. Gavin Newsom, urging him to end the state tax on health savings accounts.
California and New Jersey are the only two states in the U.S. to tax these plans. When Congress established HSAs as part of the 2003 Medicare Modernization Act, the majority of states automatically conformed to the federal tax code, which defines HSAs as tax-exempt accounts. Over the years, most states fell in line with exempting HSAs except for California and New Jersey.
What Is an HSA and How Can You Get the Most Out of Yours?
A health savings account, or HSA, can be a great way to recognize potentially significant tax savings—if you’re eligible.
When you sign up for health insurance through your employer or the Affordable Care Act marketplace, you might come across references to HSAs. However, eligibility to open and fund one of these tax-preferred accounts is limited to people enrolled in high-deductible health plans.
“HSAs are my favorite type of account,” says Steve Durso, a benefits account director at Willis Towers Watson, an insurance and human resources consulting firm, although he acknowledges that there’s a learning curve, calling the eligibility requirements “complicated.”
Podcast: The Mainstreaming of Health Savings Accounts
Nearly 72 million Americans were covered by health savings accounts at the end of 2022, an increase of 6.5% from the year before, and HSAs are used across the income spectrum, with 75% of accountholders living in a zip code with a median household income of less than $100,000. On the latest episode of the ABA Banking Journal Podcast ABA’s Kevin McKechnie and HSA expert Eric Remjeske discuss the findings of the latest ABA HSA Council/Devenir survey of HSA accountholders. McKechnie and Remjeske also talk about how HSAs fit into the business models of banks of all sizes, why large numbers of community banks have become HSA funds custodians, how banks use HSA plans for their own employees and policy issues facing HSAs in the coming months and years.