Checking the Pulse of the HSA Market with Devenir’s Eric Remjeske

To check in on the pulse of the HSA market, we talk with the co-founder and president of Devenir Research Eric Remjeske, who is also a co-author of the semi-annual Devenir HSA Marketplace Research Report, recognized as the industry standard for tracking health savings account market statistics and trends.

We’ll cover the key findings from the latest report while also talking about some market growth projections, thoughts on why more people aren’t using them as a savings tool, and 2025 HSA contribution limits.

Key Insights Include:

• Record Growth in HSA Assets: The latest report from Devenir Research highlights significant growth in Health Savings Account assets, which reached $123 billion across 37 million accounts by the end of 2023. This represents a 19% increase in assets and a 5% increase in the number of accounts compared to the previous year. The strong stock market performance in 2023 was a major contributor to this growth.
• Slowing Growth in New HSA Accounts: Despite the increase in assets, the growth rate for new HSA accounts has slowed. This trend is attributed to a flattening in enrollment for HSA-eligible health plans and a relatively stagnant employment cycle, resulting in only a modest 5% increase in the number of accounts. Economic factors such as higher interest rates and limited employment growth have also played a role in this slowdown.
• Challenges in HSA Investment Utilization: The report reveals that only 8% of account holders invest their funds, yet this small group accounts for about one-third of the total market assets. Contributing factors include the current interest rate environment, economic constraints, and a general need for liquidity among HSA holders. Despite these challenges, the trend towards investment is slowly growing, with more individuals beginning to leverage the potential of HSAs for long-term savings and investment.

SEE ALSO:

• Health Savings Account Asset Growth Booming