2011 Health Savings Account enrollments grow 14% over 2010

June 15, 2011 - The number of Americans who are enrolled in HSA-qualified insurance plans in 2011 included 2.4 million holders of individual coverage, 2.8 million small business employees and 6.3 million employees of large companies. The total grew to about 11.5 million this year, up 14% from the 2010 total.

Enrollment in HSA-qualified large group plans rose 26% in large companies while enrollment in individual HSA-qualified individual health insurance grew 15%. Commercial insurance carriers like UnitedHealthcare's Golden Rule Insurance and Celtic Insurance Company have been successful in boosting market share in the individual consumer market for HSAs.

Enrollment in HSAs in small business plans grew at a slower pace of under 10%, reflecting the long term downward trend in health plan offerings among the nation's small businesses. We have previously reported an observation that small businesses tend to realize smaller savings than larger employers and healthy individuals when switching to a Health Savings Account. Freedom Benefits' owner Tony Novak says that small businesses can save more money using another type of consumer-driven health plan called a Health Reimbursement Arrangement or HRA. HRAs gives a small business more flexibility to choose lower cost insurance than a Health Savings Account.

More than one in three new individual insurance buyers opted for a Health Savings Account in 2011 according to Freedom Benefits' OnlineAdviser, an online enrollment support service. This data excludes individuals who enrolled for supplemental health insurance, limited benefit insurance and short term major medical plans. Overall, Health Savings Account enrollments now account for about 1 in 10 individual health insurance purchases.

While the growth rate of enrollment is impressive, less than 1 in 30 Americans are now using a Health Savings Account. Those who do elect this type of health coverage typically enjoy lower insurance premium contributions and the ability to save pre-tax earnings for future medical expenses. Some of those enrolled in HSA-qualified insurance have not opted to open a Health Savings Account and therefore do not receive the full intended benefit of these plan. Even though the Health Savings Account is available free of charge to qualified insurance enrollees, some do not have the money available to fund an account. Financially stressed employees sometimes choose the HSA-qualified insurance simply because it is less expensive than the other options offered. Employers who sponsor group health insurance are not required to make a contribution to employees' Health Savings Accounts.

This national data was compiled by America’s Health Insurance Plans, a health insurance industry association. Individual enrollment information is reported by Freedom Benefits Association.