What’s behind HSA, FSA adoption?

How do users of health savings accounts and flexible spending accounts feel about them? Visa presented the results of its research into the behavior of HSAs and FSAs at the Employee Benefit Research Institute Financial Well-being Symposium.

HSA and FSA users and non-users have some common attitudes and behaviors, said Heather Ruff, Visa senior account executive, health care and employee benefits. Consumers continue to feel they are taking better care of their health, although they are concerned about the lingering effects of COVID-19. Consumers also are spending more money on health care and worry about their ability to pay for health care needs.

About two-thirds of FSA users say they budget for health care “extremely well” or “very well,” compared with only 43% of nonusers, she said. More than half (56%) of FSA users said they would cut back about one-third of their over-the-counter medications or treatments such as vision or dental if they didn’t have an FSA.

The lack of familiarity with HSAs continues to grow. Ruff said 34% of HSA users know little or nothing about their account – up from 24% in 2023. More than 4 in 5 nonusers (81%) said they know little or nothing about HSAs – an increase from 74% in 2023.

“We still have many barriers in place to getting people to understand and adopt HSAs,” she said.

Education is key to getting nonusers to adopt HSAs, Ruff said. Three in four nonusers could be persuaded to sign up for an HSA but they want to know whether they are eligible for it, whether an HSA would save the money and how easy it is to use.

FSA users have concerns

FSA users have concerns over their plans, with Ruff saying 31% reported the plan isn’t worth the money because funds are lost if they aren’t used, and 35% describing FSAs as complicated.

An increasing amount of FSA funds are being carried over or forfeited, Ruff said. The average carryover amount from 2024 to 2025 was $330, up from $307 from 2023 to 2023. Meanwhile, the average amount of FSA funds forfeited in 2024 was $463, an increase from $311 in 2023.

These rising FSA carryovers and forfeitures suggest contribution misalignment and uncertainty in using the funds, she said.

“We need to help people better use their account, use their dollars and put their money to work for them.”

HSA users report having an account makes them feel “safe,” “confident” and “secure.” But an increasing percentage feel the impact of health care costs, Ruff said. Fifty-seven percent of HSA users said they have concerns about paying for their family’s health care needs this year, an increase from 52% in 2023.

Users also invest their HSA funds to pay for future health care needs, she said. About 25% of HSA users invest funds to save for higher medical expenses anticipated in retirement.

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