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Who funds their health savings account and why?

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Abstract

Health savings account (HSA) enrollment has increased markedly in the last several years, but little is known about the factors affecting account funding decisions. We use a unique data set containing from a bank that exclusively services HSA funds linked to health status, benefit design, plan coverage, and enrollee characteristics from a very large national health insurance company to examine the factors associated with HSA contribution. We found that even small employer contributions had an apparently large effect on the decision to open an account: the account-opening rate was 50 % higher when employers contributed to the account. Conditional on opening an HSA, employee contributions were negatively associated with the amount of employer contribution, contributions rose with age, income, education, and health care need.

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Notes

  1. This figure included both HSAs and Health Reimbursement Arrangements (HRAs), the latter being purely notional accounts lacking portability and enrollee ownership.

  2. In our study population, the coinsurance for hospitalizations was 0, 10, or 20 % in most cases but might be 5, 15 %, or higher than 20 % in rare cases (together accounted for two percent of the total population). We joined 5 % into the 10 % category, all levels higher than 10 % into the 20 % category.

  3. Single contracts include employee-only plans. Single + 1 contracts include two-person plans, such as employee and domestic partner, employee and one child, employee and spouse. Family contracts include three people or more plans, such as employee and children; employee, spouse, and one child; employee, spouse, and children; and spouse and children.

  4. Both ERGs and ETGs are products of OptumInsight, a subsidiary of UHG.

  5. The literature reports that ERG risk scores highly correlate with other risk-adjusted measures of practice efficiency, such as Adjusted Clinical Groups, Burden of Illness Score, Clinical Complexity Index, Diagnostic Cost Groups, and General Diagnostic Groups (Thomas et al. 2004).

  6. A fully insured plan is where an employer contracts with UHG to assume financial responsibility for enrollees’ claims and for all incurred administrative costs.

  7. ASO is an arrangement in which an employer hires UHG to deliver administrative services such as claims processing to the employer, but the insurer in such scenarios bears no risk.

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Correspondence to Anthony T. Lo Sasso.

Appendix

Appendix

See Table 4.

Table 4 Comparison on characteristics between account openers with OptumHealth Bank and non-openers (n = 307,756)

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Chen, S., Lo Sasso, A.T. & Nandam, A. Who funds their health savings account and why?. Int J Health Care Finance Econ 13, 219–232 (2013). https://doi.org/10.1007/s10754-013-9131-8

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  • DOI: https://doi.org/10.1007/s10754-013-9131-8

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