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A summary of the articles included in the July 2025 edition:

  • Trends in Health Savings Account Balances, Contributions, Distributions, and Investments, 2011–2023
  • Cafeteria Plan Rules Permit HSA Owners to Adjust Contributions Throughout the Year
  • Health Savings Account Contributions, Investments Can Be Boosted By One Key Thing
  • Tax Savings Drive Enrollment in Health Savings Accounts (HSAs)
  • Completed a Rollover and No Longer Eligible? Can You Still Make Tax-Free Distributions?


Trends in Health Savings Account Balances, Contributions, Distributions, and Investments, 2011–2023

Plan sponsors that wish to introduce or continue offering HSA-eligible health plans as part of their workplace benefit program can benefit from a long-term view of HSA accountholder behaviors. As such, EBRI has undertaken a series of longitudinal studies from its HSA Database, examining trends in account balances, individual and employer contributions, distributions, invested assets, and account-owner demographics from 2011‒2023. Such analysis can help plan sponsors, providers, and policymakers better understand strategies that can help improve employee financial wellness.

HSAs offer a triple tax advantage to accountholders, enabling them to stretch money they save for health care expenses further than they otherwise could. The tax benefits of HSAs are maximized when accountholders contribute the statutory maximum and minimize withdrawals for current medical expenditures — if they are able — and invest their HSA balances in assets other than cash. However, the majority of accountholders appear to use their HSAs to pay for current expenses and do not take complete advantage of the tax benefits HSAs offer. Average contributions are well below the statutory maximum, most accountholders take a distribution from their HSA, and relatively few accountholders invest. We do find that, as time goes on, accountholders tend to take fuller advantage of the benefits HSAs offer. And, despite out-of-pocket spending on health care rising by 7.5 percent in 2023, average balances in HSAs increased, rising from $4,607 in 2022 to $4,747 in 2023. Further, the share of accountholders who invest their HSAs has crept steadily upward since EBRI began analyzing its HSA Database.

Cafeteria Plan Rules Permit HSA Owners to Adjust Contributions Throughout the Year

Question: My employer allows me to contribute to my Health Savings Account on a pre-tax basis through a Cafeteria Plan. Am I permitted to change my contribution levels during the year? Can I start or stop contributions at any time?

Answer: Yes to both questions.

Cafeteria Plan rules, which normally do not allow participants to adjust annual elections without a corresponding qualifying event, were amended for Health Savings Accounts. You can change your election prospectively at least monthly during the year. You can increase or decrease your payroll deductions, stop them completely mid-year, start them at any point, and make lump-sum payments. In short, you have great flexibility in how you manage the flow of contributions to your Health Savings Account through a Cafeteria Plan.

Health Savings Account Contributions, Investments Can Be Boosted By One Key Thing

With American retirees living longer, but likely requiring increased health care provision, the importance of ensuring that retirement planning includes health costs is clear.

But while health savings accounts offer solution that combines retirement and health care savings in one account, new research highlights how one key thing can boost contributions and the investments included in HSAs.

The report from EBRI drew on the organizations’ database of over 14.5 million accountholders and analyzed data from 2023. It found that although few accounts saw the maximum contributions allowed in that year, balances did increase despite higher spending on health care as out-of-pocket expenses increased 7.5% from the previous year.

Tax Savings Drive Enrollment in Health Savings Accounts (HSAs)

EBRI/Greenwald Research Consumer Engagement in Health Care Survey found that among private health plan enrollees with a HSA, individuals often chose more than one reason as to why they opened an HSA.

More than one-half reported opening it to save on taxes. Similarly, 53 percent opened their HSA to save for future health care expenses and 52 percent to take advantage of employer contributions. Four in 10 opened the account to save for health care expenses in retirement. Only one-quarter opened the account to invest, and the same share opened the account to help save for retirement more generally.

Completed a Rollover and No Longer Eligible? Can You Still Make Tax-Free Distributions?

Question: I lost my eligibility to fund a Health Savings Account several years ago. I’ve maintained a balance that I plan to use in retirement. I’ve since found an account with better features. If I roll over my old balance, do I lose my opportunity to reimburse prior years’ expenses?

Answer: No. When you roll over balances from one Health Savings Account to another, you do not set a new establishment date. You always go back to the date that you established the original Health Savings Account. (See Question 79.) You can reimburse all qualified expenses that you, your spouse, or your tax dependents incur since that date. Keep in mind that these family members must be your spouse or tax dependent when they incur the qualified expense, not necessarily at the time you reimburse it.