When it comes to HSA enrollment, converting eligible employees to enrolled participants is not news. The most common advice is to gradually transition from offering traditional plans to consumer-direct health plans (CDHPs). That is still a very effective strategy and holds true. But there is more to HSA enrollment than offering a CDHP.
Beyond offering a CDHP
In addition to plan design as a function of HSA adoption, cultural shifts in the workforce have lent HSAs a hand, bringing in higher enrollment numbers that only seem to be gaining momentum.
HSA enrollment on the up and up (again)
According to consulting firm Devenir, HSA enrollment levels were up 13% in 2018, with more than 25 million new accounts opened over the course of the year. This pattern mimics HSA enrollment trends from the last two years. There were 22 million new accounts opened in 2017 and 20 million new accounts opened in 2016.
What drives new account growth?
While various factors are at play, Devenir cites two main drivers of new account growth: direct employer relationships and health plan partnerships.
Another driver of growth includes one of the largest cohorts in the workforce: Millennials.
When it comes to Millennials…
A recent CNBC article cites a report from benefits platform BenefitFocus, which found that Millennials are engaging in very favorable HSA adoption behavior.
According to the report, in 2018 an impressive 75% of Millennials under the age of 26 had enrolled in an HSA. That’s up 40% from 2017 HSA enrollment numbers.
Popularity of HSAs among Millennials
The popularity of HSAs among Millennials, mostly in their mid-20s to late-30s, is driven by two factors.
First, the younger half of this group is still staring down college debt. They look for opportunities to actively cut costs.
Second, this generation grew up either with parents who experienced severe financial set backs during the 2008-2009 crisis or whom experienced hardships themselves during this time as they were seeking jobs in a tight market.
Three final tips
To leverage the existing trends built into the HSA healthcare landscape, lean into employee advocacy, map out a migration strategy and reward employees who enroll.
Lean into employee advocacy
Your employees who already have an HSA (regardless of their generation) can be a powerful resource. They have direct experience they can share with other employees about why they chose the account and the direct benefits of the choice.
Map out a migration strategy
As stated at the opening of the blog, it’s important to employ a strategy that transitions you from a traditional plan to a CDHP that supports HSA enrollment.
Reward employees who enroll
You also want to reward those who enroll by seeding the account. To catch the attention of eligible employees, promote the added benefit of the employer contribution as free money.
Interested in learning more about migrating from a traditional health plan to a CDHP? Download our complimentary guide.
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