SECTION8. HIGH-DEDUCTIBLEHEALTHPLANSWITHSAVINGSOPTION EMPLOYERCONTRIBUTIONSTOPREMIUMSANDSAVINGSOPTIONS • EmployerscontributetoHDHP/SOsintwoways: throughtheircontributionstowardthepremiumforthehealthplan andthroughtheircontributions(ifany,inthecaseofHSAs)tothesavingsaccountoption(i.e.,theHRAsorHSAs themselves). – Lookingatonlytheannualemployercontributionstopremiums,coveredworkersinHDHP/HRAsonaverage receiveemployercontributionsof$5,222forsinglecoverageand$13,817forfamilycoverage[Figure8.8]. These amountsaresimilartothecontributionamountslastyear. – TheaverageannualemployercontributionstopremiumsforworkersinHSA-qualifiedHDHPsare$4,855for single coverageand$12,532forfamilycoverage,similartothecontributionamountslastyear. Theaverage employercontributionforcoveredworkersinHSA-qualifiedHDHPsforsinglecoverageislowerthantheaverage contributionforcoveredworkersinplansthatarenotHDHP/SOs[Figure8.8]. • Lookingatemployercontributionstothesavingsoptions,coveredworkersenrolledinHDHP/HRAsonaveragereceive anannualemployercontributiontotheirHRAof$1,351forsinglecoverageand$2,444forfamilycoverage[Figure8.8]. – HRAsaregenerallystructuredinsuchawaythatemployersmaynotactuallyspendthewholeamountthatthey 3 makeavailabletotheiremployees’HRAs. Amountscommittedtoanemployee’sHRAthatarenotusedbythe employeegenerallyrolloverandcanbeusedinfutureyears,butanybalancemayrevertbacktotheemployer if the employeeleaveshisorherjob. Thus,theemployercontributionamountstoHRAsthatwecaptureinthe surveymayexceedtheamountthatemployerswillactuallyspend. • CoveredworkersenrolledinHSA-qualifiedHDHPsonaveragereceiveanannualemployercontributiontotheirHSAof $608forsinglecoverageand$1,086forfamilycoverage[Figure8.8]. Theseamountsdonotincludethe3%ofcovered workersinHSA-qualifiedHDHPswhoseemployerssaytheyvaryaccountcontributionsbasedoncertainfactors,suchas jobclassificationorparticipationinawellnessprogram[Figure8.18]. – Inmanycases,employersthatsponsorHSA-qualifiedHDHP/SOsdonotmakecontributionstoHSAsestablished bytheiremployees. Forty-sevenpercentofemployersofferingsinglecoverageand46%offeringfamily coveragethroughHSA-qualifiedHDHPsdonotmakecontributionstowardtheHSAsthattheirworkers establish. Twenty-threepercentofworkerswithsinglecoverageand23%ofworkerswithfamilycoverageinan HSA-qualifiedHDHPdonotreceiveanaccountcontributionfromtheiremployer[Figures8.16and8.17]. – TheaverageHSAcontributionsreportedaboveincludetheportionofcoveredworkerswhoseemployer contributiontotheHSAiszero. WhenthosefirmsthatdonotcontributetotheHSAareexcludedfromthe calculation, the average employercontributionforcoveredworkersis$795forsinglecoverageand$1,417for familycoverage. – ThepercentageofcoveredworkersenrolledinaplanwheretheemployermakesnoHSAcontributionforsingle andfamilycoverage(23%)issimilartothepercentageinrecentyears. • Employercontributionstosavingsaccountoptions(i.e.,theHRAsandHSAsthemselves)fortheirworkerscanbeadded totheirhealthplanpremiumcontributionstocalculatetotalemployercontributionstowardHDHP/SOs. Wenotethat HRAsareapromisebyanemployertopayuptoaspecifiedamountandthatmanyemployeeswillnotreceivethe full amountoftheirHRAinayear,soaddingtheemployerpremiumcontributionamountandtheHRAcontribution representsanupperboundforemployerliabilitythatoverstatestheamountthatisactuallyexpended. Sinceemployer contributionstoemployeeHSAaccountsimmediatelytransferthefullamounttotheemployee,addingemployer premiumandHSAcontributionsisagoodwaytolookattheirtotalliabilityundertheseplans. – ForHDHP/HRAs,theaverageannualtotalemployercontributionforcoveredworkersis$6,573forsinglecoverage and$16,261forfamilycoverage. Theaveragetotalemployercontributionamountsforcoveredworkersforsingle 3 Thesurveyasks“Uptowhatdollaramountdoesyourfirmpromisetocontributeeachyeartoanemployee’sHRAorhealthreimbursementarrangementfor single coverage?” WerefertotheamountthattheemployercommitstomakeavailabletoanHRAasacontributionforeaseofdiscussion. Asdiscussed,HRAs arenotionalaccounts,andemployersarenotrequiredtoactuallytransferfundsuntilanemployeeincursexpenses. Thus,employersmaynotexpendthe entire amountthattheycommittomakeavailabletotheiremployeesthroughanHRA.SomeemployersmaymaketheirHRAcontributioncontingenton otherfactors,suchascompletingwellnessprograms. The Kaiser Family Foundation and Health Research & Educational Trust / Page 141