A new report issued by the Employee Benefit Research Institute shows that Health Savings Accounts (HSA’s) and Health Reimbursement Arrangements (HRA’s) grew in popularity in 2011. Paul Fronstin, “Health Savings Accounts and Health Reimbursement Arrangements: Assets,
Account Balances, and Rollovers, 2006–2011,” EBRI Issue Brief, no. 367, January 2012. The report shows that the number of accounts increased from 5.4 million to 8.4 million from 2010 to 2011, a 58% jump. In 2006, there were only 1.3 million accounts. The average account in 2011 had just over $1400 in it, also an increase from 2010, resulting in the total held in both HRA’s and HSA’s combined increasing from $7.3 Billion to $12.4 Billion in just one year. The increasing popularity of these accounts, which give individuals more more control over their health care purchasing, may run into a barrier with the Affordable Care Act. The Act limits the degree to which employers can utilize HRA and HSA benefits, and the Administration has already placed limits on the types of health expenditures for which HSA and HRA funds can be used. The first took effect in 2011, when the Affordable Care Act eliminated over-the-counter drug purchases as qualified expenditures. (In a perverse twist, given the professed goal of encouraging the use of less expensive alternatives, the IRS will allow reimbursement of non-prescription drugs if the patient actually goes to a doctor and has the doctor write a prescription for the non-prescription medicine.) In any case, with HSA’s and HRA’s skyrocketing in popularity, the Affordable Care Act’s inhospitability to those accounts may well create issues for employers who would like to use those accounts as a significant part of their overall health and wellness program for their workforce.
