What are the keys to successful implementation of an HSA in the workplace?
The attractiveness of a High deductible Health Plan (HDHP) is dependent upon three factors:
- The difference between the employee contribution to the premium of HDHP vs. the traditional plan being offered. The greater the difference, the more the employee has to put into their HSA.
- The employer contribution to the HSA. If #1 above is sufficient, the employer contribution doesn’t really matter. Ultimately the total employee savings and employer contribution need to be sufficient to fund the HSA to a level that makes the increased risk of the HDHP acceptable for the employee.
- Education. If the employee (and their spouse) does not have a good grasp if the HDHP and HSA interaction they will not make a change, even if the contribution/savings numbers described above make sense. Repetition and education over time are the best methods for conveying the benefits of an HSA and for overcoming the natural fear of the unknown.
2 People have left comments on this post
We currently pay for the medical and dental insurance for our employees. Do you help us find a High Deductible Health Plan and then help us sign up for the HSA?
I am thinking we would pay for the HDHP and also do the contributions to the HSA is that correct? Is it best to begin the process so we are all set up for 2010?
I am also thinking that the max deductible for the HDHP is $2,400 for families and $1,200 for singles. The maximum contribution we as the employer can contribute to the HSA is $6,150 for a family and $3,050 for a single. Is the employee eligible to contribute additionally also?
There are a variety of avenues for getting your high deductible insurance. I would start with your current carrier. We at Health Savings Administrators can help with the HSA set up while you are getting the HDHP policy.
Many employers make contributions to the HSA. We have found several factors key to increasing the adoption rates for HSAs: premium differential (i.e.. the HDHP need to be noticeably less expensive that the traditional plan), an employer contribution – especially important if the premium differential is not impressive; education on the HSA; and surprisingly enough, payment of the fees. While the fee amount is low, it does appear to be a psychological barrier that is greater than you might think.
The deductibles you quote are actually the minimums to qualify for an HDHP. They could go as high as $5950/$11900 for single/family in 2010.
The max contribution includes both the employer and employee contribution. The total of those two cannot exceed the maximum numbers you quote.