More on HSAs: What's next?
(Editor's note: This is the second of two parts. Read Part One.)
Analyzing the data can appear cumbersome initially, but it doesn’t have to be. We have found it helpful to look at each data point as if it were the answer to a question. Each of these questions can be answered through the data and can be tracked over time. It is important to analyze the reports with the employee in mind.
Some of the common employer questions include:
• How are employees using their accounts?
• Are the employees using their account more often to spend or save?
• How much does an employer have to fund, and for how long?
• What is the level of employee engagement in the plan?
• What are the employees’ habits for contributions and distributions?
In addition to typical reporting metrics, we have also identified several additional key data metrics that allow for tracking trends. We view these metrics as probably the most significant aspects of account trends to monitor and as vital for all employer groups. These include:
• Percentage of accounts with employee contributions
• Contribution to distribution ratio
• Distribution frequency versus benchmark average
• Remaining balance to contributions
Data reporting can also help identify and classify different behaviors of employee accountholders, which is helpful in creating tailored communications. For example, if employers identify that employees regularly spend their account balances and aren’t realizing the benefits of saving in the account, they can implement a tailored communication plan on the importance of building long-term wealth in their HSA.
To effectively implement change based on the reporting data, employers need to have a plan for what they hope accomplish within their HSA plan offering – what problem they need to tackle. We have identified a six-point plan to better manage this process, including the following steps:
• Identify the item/problem to impact
• Choose the best way to impact the result
• Identify the measure of success
• Deploy the necessary resources
• Regularly review
• Make adjustments
By analyzing the reporting trends over a period of time, employers can review their progress impacting change in their HSA plan.
Employers need to take the time to regularly view and understand their HSA reports. In addition, it is critical to analyze the data to see what trends and opportunities for improvement exist. While many employers are strapped for time and resources, business partners, including HSA administrators and brokers/agents, have the experience and knowledge to help in driving positive change.
During the last decade, HSAs have proven to be a significant long-term savings and cost containment vehicle for health care expenses. We believe this is just the beginning. As our industry moves into the next decade of HSAs, we need to focus our attention on the tools needed to create measurements of success and execute on plans that can improve the future health and wealth of employees.