Lively Inc., a health savings account (HSA) provider, has released its “2018 HSA Spend Report,” revealing what health care expenses consumers encountered most last year.
Surveying 15,000 randomly chosen holders of its HSAs, Lively also compared its findings “against data from the Center for Medicare and Medicaid Services to understand the similarities and differences between HSA spending and national health-care spending.”
According to the study, Lively’s average HSA-holder spent 93% of his account savings on household health care costs last year, including doctor visits and services (41%); prescription drugs (25%); dental care (9%); hospital visits (7%); vision and eyewear (5%); chiropractor services (5%); lab work (4%); and other health expenses (4%).
“Health care costs continue to squeeze Americans, rising faster than wages can keep up,” says Alex Cyriac, co-founder and CEO of Lively. “This forces individuals and families to use their HSA funds for everyday necessities—such as preventative visits, dental or vision care, and prescription drugs—rather than saving those funds to create a safety net for health care costs down the road and into retirement.”
Lively reports that this trend could block participants from investing their HSA assets, which could ultimately help them afford the expected $280,000 in health costs throughout retirement.
Additional findings include a rise in short-term costs, such as for doctor visits and prescription drugs, also meaning less for the consumer to invest for short and long-term tax advantages.
Interestingly, the greatest use of employees’ HSA funds was physician and clinical services, “followed by prescription drugs (25%) and then hospital expenses (7%).The opposite was true for national health-care spending. Hospital expenses drive the majority of expenses (33%), followed by physician and clinical service costs (20%), and then prescription drugs (10%),” the report says. It attributes the difference to the fact that HSA-holders are typically younger, as HSAs were only introduced in 2003, and include no Medicare subscribers, as those are prohibited from holding HSAs.
More information on the study can be found here.