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Information for Brokers

Evaluating an HSA/HDHP as an Employer

Employer HSA Advantages

As health care costs and the associated premiums continue to rise, many employers are turning to HSA/HDHP combinations to bring costs under control while still providing valuable benefits to their employees.

Advantages to employers include:

• Lower Premiums – High-deductible Health Plans generally feature lower premiums than other plans, reducing employer benefits costs.
• Valuable Benefits – By using part of the premium savings to contribute to employee HSAs, employers can still offer valuable benefits to their employees and reduce employee out-of-pocket healthcare costs.
• Realigned Incentives – By giving employees a financial stake in their healthcare costs, these plans incent them to become more involved in their healthcare decisions and lead healthier lives.  The results are healthier employees, reduced costs, and reduced premium growth.

Please see our Employer Benefit calculator to estimate employers' potential savings.

Example

Consider how this employer could benefit from offering an HSA/HDHP plan:

Today

A small employer with 100 employees currently contributes an average of $700 per employee per month toward their health care premiums.  His total annual cost is $840,000.

With an HSA/HDHP Plan¹

The employer decides to offer an HDHP with a $3,000 annual deductible, paying a premium of $400 per employee per month.  The employer also contributes $167 per month to each employee’s HSA.

Because of this plan, the employer could save $133 per employee per month.  Meanwhile, employees receive employer contributions of $2,000 per year into their HSAs, greatly reducing the deductible risk.

In this case, the employer saves $159,600 annually while still providing valuable benefits to his employees.

¹This is only an example.  Actual results will vary.

ARCUS Financial Bank and its affiliates are not providing tax advice through this website and we cannot respond to specific tax questions.  Tax issues are often very dependent on the specific facts.  Clients are encouraged to seek their own tax advice.

Evaluating HSA Plans as a Consumer