Many Americans made financial resolutions for the New Year—but many are still missing significant savings from tax-free accountsNew Alegeus research reveals employees feel that their employers should play a significant role in ensuring their financial preparedness for healthcare costs.
January 30, 2023 08:30 AM Eastern Standard Time–WALTHAM, Mass.–(BUSINESS WIRE)–According to a new survey by Alegeus, the market leader in healthcare payment solutions, 66 percent of respondents made finance-related resolutions for 2023 – whether that be saving more (54%), spending less (44%) or sticking to a budget (38%). Of those respondents making finance-related resolutions this year, 78 percent stated that healthcare spending will factor into their efforts.
The survey of 1,018 U.S. respondents also found that 65 percent are at least somewhat concerned about their ability to afford care for themselves or their family this year, and that number jumps to nearly 80 percent when asked about their ability to afford care longer term, into retirement. These concerns stem from various economic factors – like inflation impacting budget (60%) and rising out-of-pocket costs associated with employer health benefits (40%) – that are only fueling continued uncertainties post-pandemic. And yet, few respondents feel they are prepared to manage their healthcare finances this year and beyond, with almost half only feeling somewhat prepared.
The Onus Is On The Employers
The onus has fallen on employers to provide the necessary tools to help employees address these concerns. According to the survey, 77 percent agree that their employer should bear significant responsibility for supporting them in their financial preparedness for healthcare costs. While respondents say their employers are preparing them to face the financial realities of healthcare through benefits like health insurance (59%) and 401k/retirement plans (49%), they expect more. Only 11 percent said that their employers offered lifestyle benefits – unveiling a largely untapped opportunity. While many equate lifestyle benefits to free lunches and other perks, there are a multitude of lifestyle-based benefits employers can provide – such as healthy living and family care – that directly address the concerns respondents shared.
When asked if they were to set an additional resolution specifically about their healthcare finances, respondents noted improving overall financial health (45%) and protecting themselves from unexpected healthcare expenses and medical debt by building up a savings cushion (37%).
On the other hand, only 15 percent said they would make tax-free saving/spending a priority by enrolling in a flexible spending account (FSA) or health savings account (HSA), or by taking advantage of an employer-provided health reimbursement arrangement (HRA). This lower number likely indicates a knowledge gap regarding the value of these programs, especially as employees can save upwards of $2,000 per year on taxes depending on their account elections and current tax rate. For example, HSAs, which offer the most significant tax advantages, are still too often under-utilized and under-emphasized by both employers and employees, causing them to miss out on significant savings opportunities that could help them achieve their 2023 resolutions.
To learn more about strategies for healthcare savings and other resources, visit here.
The results cited above are from an online survey that was fielded from January 13-16, 2023, by independent research firm Researchscape. There were 1,018 U.S. respondents to the survey.
With more than 25 years of growth and innovation, Alegeus is the market leader in SaaS-based benefit funding and payment solutions. Our highly flexible, white-label platform powers account-based benefit programs such as HSAs, FSAs, HRAs, COBRA, wellness incentives, lifestyle benefits and beyond. We deliver exceptional user experiences and differentiate capabilities that help our partners strengthen their product offerings, operate more efficiently, and unlock their full growth potential. Our partnerships with the industry’s leading health plans, third-party administrators, financial services and benefit solution providers give Alegeus unparalleled reach in the market, with access to more than 100 million commercially insured Americans. Alegeus is headquartered in Waltham, Mass., with operations centers in Orlando and Bangalore, and a large remote workforce.