HEALTH SAVINGS ACCOUNTS
Investment assets in health savings accounts dropped slightly in 2022 for the first time due to "significant stock market headwinds," an annual survey found.
Investments other than cash in health savings accounts remain low even though the percentage has been rising slowly in recent years.
More employers are using automatic enrollment into health savings accounts as part of an effort to position the accounts more as savings vehicles.
While health savings account assets have grown at a more than 30% annualized rate over the past 15 years, only 9% of accounts have investment assets.
Making investments within HSAs is growing, but researchers and advocates say providers and sponsors must do more to accelerate the pace.
Total assets of health savings accounts reached $92.9 billion as of June 30, with investments accounting for an estimated $30.4 billion.
Most employers that offer investment options for health savings accounts require a balance of $1,000 or more before participants can invest.
Voya Financial agreed to buy Benefit Strategies, a third-party administrator of health savings accounts.
HSA providers and DC record keepers are trying many strategies to encourage participants to use HSAs as an investment source.
As HSAs take on greater investing opportunities, providers are employing strategies designed to overcome some restrictions.
