Mass Takes a Pass on HSAs

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America’s Health Insurance Plans (AHIP) released a report on the utilization of health savings accounts (HSAs) around the country.

Massachusetts has lagged behind for years in the adoption of HSAs. One reason may be that only 43.1 percent of Massachusetts private-sector employers were enrolled in a plan with a deductible compared to 73.8 percent of employers nationally. Massachusetts residents enrolled in high deductible plans (often coupled with an HSA) account for only 2 percent of those with health insurance,  placing the Commonwealth with one of the lowest percentages of residents enrolled in these plans in the nation.

The trade-off is two fold.

One, these employees are receiving a pay cut as more money is spent on health insurance.

Second, the incentives for employees to be smart consumers of health care is all but removed.

Slide 2 shows the rapid national growth in adoption of HSAs.