Key Takeaways
- Many employees do not fully understand how Health Savings Accounts (HSAs) work.
- HSA education can improve employee participation and engagement with benefits.
- HSAs can help employees prepare for both current healthcare expenses and future retirement healthcare costs.
- Financial coaching can help employees evaluate healthcare plan choices and budgeting strategies.
- Year-round education is often more effective than limiting communication to open enrollment.
Why HSA Education Matters
Healthcare costs can significantly impact household budgets if not properly planned for.
Health Savings Accounts (HSAs) have been available for around 20 years. According to recent industry research, HSA adoption continues to grow, with nearly 39 million accounts holding approximately $147 billion in assets.¹
Despite this growth, many employees still do not fully understand how tax-advantaged HSAs can support both their immediate healthcare needs and long-term retirement goals.
MSA surveys found that 57% of respondents said they did not have a Health Savings Account, and 55% said they don't fully understand the benefits of an HSA.² Additionally, 71% of respondents said they were not confident in their ability to cover medical expenses when they retire.³
Given the number of benefit decisions employees face during open enrollment, many default to the same healthcare plan year after year without evaluating whether an HSA-eligible plan may better align with their healthcare usage, financial goals, and retirement planning needs.
According to the 2024 Consumer Engagement in Health Care Survey, one-half of health plan enrollees spent less than one hour choosing their health plan during open enrollment, and nearly one-third spent less than 30 minutes.⁴
This creates an opportunity for employers to improve employee understanding through ongoing education and decision support.
HSAs Are More Than a Healthcare Benefit
The challenge is not simply providing access to HSAs. The greater challenge is helping employees understand how HSAs fit into their overall Financial Well-being and retirement strategy.
And having that insight during open enrollment alone often isn't enough.
Healthcare decisions can affect:
- Monthly cash flow
- Emergency savings
- Retirement planning
- Tax strategies
- Long-term healthcare preparedness
MSA's experience providing Financial Well-being services has shown that healthcare plan decisions often require education and discernment over much longer timeframes than a brief enrollment period.
My Secure Advantage, Inc. (MSA) is a Financial Well-being organization serving millions of employees across America for more than 35 years. MSA Money Coaches have educated thousands of employees about the differences between healthcare plans and helped them understand the budget implications of those decisions.
Employers can help employees make more informed decisions by providing year-round educational resources and access to personalized support.
How Employers Can Help Employees Make Better Benefits Decisions
Consider These Important Points During HSA Education Efforts
Employees may need to do some savings preparation before transitioning to a high-deductible healthcare plan.
One of the key benefits of an HSA is the ability to roll over and invest unused funds so they may be used to cover future medical expenses.
Ideally, current-year health expenses would be covered out of pocket, meaning employees have designated available savings rather than relying on emergency savings or growing credit card balances.
Employees can benefit from financial coaching that helps them create a budget, build savings, and identify spending adjustments that free up funds for future healthcare costs.
Employers can increase awareness of coaching resources already available through existing benefits programs or consider adding and promoting these services.
One of the Most Powerful Features of an HSA Is Its Triple Tax Advantage
Contributions to HSAs are deducted from paychecks before taxes, lowering taxable income.
Funds that are rolled over each year can be invested, and growth is federal tax-free.
When withdrawals are made, they are generally not taxed if the money is spent on eligible medical expenses.
There may be a few states that treat HSA contributions or earnings differently, so employees may want to consult a tax advisor regarding their individual circumstances.
Because IRS deductible thresholds and contribution limits are adjusted periodically, employees should also review current plan requirements and contribution opportunities during each enrollment cycle.
HSAs Can Play an Important Role in Retirement Planning
Future healthcare costs are expected to continue rising.
According to the Employee Benefit Research Institute, some couples could need as much as $383,000 in savings for healthcare costs during retirement years.⁵
Healthcare costs remain one of the largest unknowns in retirement planning.
Without a strategy for managing these expenses, employees may experience:
- Greater financial stress
- Lower retirement confidence
- Increased difficulty achieving long-term financial goals
Increased education efforts can help employees realize they have valuable tools available to help prepare for future healthcare expenses and retirement needs.
The earlier employees receive this education and take action, the more time they may have to build savings that can make a meaningful difference.
Employee Retirement Planning: Why Saving Alone May Not Be Enough
Looking for ways to help employees make more informed healthcare and benefits decisions?
Learn how educational guidance and personalized Money Coaching can help employees evaluate healthcare options, prepare for future expenses, and better understand available benefits.
Learn More About MSA
Employers Benefit When Employees Use HSAs
Employers also benefit when employees better understand and utilize available benefits.
Increasing awareness and participation in HSAs can improve the perceived value of an organization's benefits package while helping employees make more informed healthcare and financial decisions.
Additional employer advantages may include:
- Reduced FICA taxes and federal unemployment taxes when employees make pretax payroll deduction contributions to HSAs
- Tax-deductible employer HSA contributions
- Reduced administrative burden compared with certain other healthcare account structures
Helping employees understand available benefits can create value for both the employee and the organization.
HSA Education Shouldn't Stop After Open Enrollment
Many organizations focus HSA communication efforts during open enrollment.
However, healthcare decisions continue throughout the year.
Employees may experience:
- Changes in healthcare needs
- Family changes
- Unexpected medical expenses
- New financial priorities
- Questions about contribution levels and investment options
Ongoing communication, education, and financial coaching can help employees better understand how HSAs fit into their financial lives as circumstances change.
Employers that provide year-round benefits education may be better positioned to improve participation, increase utilization, and help employees make more informed decisions.
How Better Benefits Communication Improves Employee Engagement and Utilization
Frequently Asked Questions
What is an HSA?
A Health Savings Account (HSA) is a tax-advantaged account that allows eligible individuals to save and pay for qualified healthcare expenses.
How does an HSA work?
Employees enrolled in eligible high-deductible health plans can contribute money to an HSA. Funds can be used for qualified healthcare expenses, and unused balances generally roll over from year to year.
Why don't employees use HSAs?
Many employees are unfamiliar with HSA benefits, do not fully understand eligibility requirements, or have not received enough education to evaluate whether an HSA aligns with their needs.
How can employers improve HSA participation?
Employers can improve participation through year-round education, benefits communication, decision support, and access to financial coaching resources.
What role does financial coaching play?
Financial coaching can help employees understand healthcare plan options and the financial impact, evaluate trade-offs, create budgets that account for savings, and make more informed decisions.
Next Steps for Employers, EAPs, and PEOs
- Evaluate employee awareness and understanding of HSAs.
- Review how HSA education is incorporated into benefits communications.
- Consider providing year-round educational resources and decision support.
- Explore opportunities to connect healthcare decisions with broader Financial Well-being initiatives.
- Measure engagement and adjust communication strategies over time.
Help Employees Better Understand HSAs
HSAs can be a powerful tool for helping employees prepare for healthcare expenses and strengthen long-term financial confidence.
However, access alone is often not enough.
Employers that invest in education, decision support, and coaching can help employees better understand and utilize one of the most valuable benefits available to them.
Learn how MSA helps employers, EAPs, and PEOs improve employee understanding of healthcare benefits through educational guidance, personalized Money Coaching, and Financial Well-being initiatives.
¹ Devenir. 2024 Year-End Devenir HSA Research Report. Devenir Research, Apr. 2025.
² My Secure Advantage, Inc. October 2023. Based on MSA member self-reported live event data. 3,243 responses.
³ My Secure Advantage, Inc. September 2023. Based on MSA member self-reported live event data. 1,114 responses.
⁴ Employee Benefit Research Institute and Greenwald Research. 2024 Consumer Engagement in Health Care Survey. Employee Benefit Research Institute, Feb. 2025.
⁵ Employee Benefit Research Institute. New Research Finds That Projected Savings Medicare Beneficiaries Need for Health Expenses in Retirement. February 2023.
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