Employee benefits can be just as overwhelming for the employers who offer them as they are for the employees who use them. Whether you’re a third-party administrator (TPA), financial institution, health plan, or an HR technology provider, educating employers about your solutions will empower them to offer a competitive benefits package.
This is especially true for health savings accounts (HSAs), which still face many misconceptions in the market. Here are four things your clients need to know about HSAs in order to use this benefit effectively in their total compensation strategy.
You give your clients the option to offer an HSA
Your clients can’t benefit from a solution they don’t know about. Clearly marketing your HSA on your website and in email campaigns are great ways to make sure your clients are aware of your solution.
Make sure your marketing also communicates how to get started with your HSA offering. Your clients will need to know things like:
- When can I add an HSA to my benefits package?
- How does my employee education strategy need to change if I make this move?
- Who do I talk to about getting started?
You can also educate your clients about HSA trends and legislative updates that impact these accounts (including HSA contribution limit increases).
By ensuring they know what’s available, how to access it, and how changes in the market impact their options, you empower your clients to make informed decisions that align with their business goals.
An HSA can be good for business
Your employer clients may know that you offer a health savings account, but do they know the ways an HSA can be good for their business?
- Employer contributions are tax free, whether they’re done as a standalone contribution or an employee match.
- Employers save on premiums when they offer an HSA-eligible, high-deductible health plan.
- HSAs help employers attract and retain top talent, because their short and long term value to participants have driven employee demand for this type of account. In a labor market where benefits are a top priority for employees, failing to keep up with this trend can result in your clients losing talent to employers who do offer an HSA.
HSAs support financial, physical, and mental facets of employee wellness
Health savings accounts empower employees financially. HSA contributions reduce an employee’s taxable income, and HSA funds can be invested leading to significant growth over time.
Withdrawals for eligible expenses, including deductibles and copayments, are also tax-free prior to and during retirement. This provides employees with financial flexibility in managing wellness expenses today and planning for health expenses in retirement. Given that individuals need, on average, upwards of $175,000 for healthcare costs in retirement, the versatility of an HSA for financial wellness before and during retirement is one reason this benefit is so popular among employees.
Speaking of eligible expenses, a health savings account can also support employee mental health by covering expenses related to therapy, prescription drugs like antidepressants and anti-anxiety medications, sleep deprivation treatment, and more.
You have resources available to help your clients provide HSA education to participants
Supporting your clients in employee HSA education efforts is crucial.
- My HSA Planner is an HSA decision tool that you can share.
Lastly, benefits education should not be a one-time event. Establish a year-round strategy to keep employees informed and engaged. Regularly communicate updates, share success stories, and provide access to educational materials. A well-informed workforce is more likely to maximize the benefits of HSAs, and your clients are more likely to add an HSA to their offering if they have the support they need to drive employee benefits engagement.
The information in this blog post is for educational purposes only. It is not legal or tax advice. For legal or tax advice, you should consult your own legal counsel, tax and investment advisers.
