HSA Engagement: Should You Seed, Match or Reward? 

by | Mar 3, 2022

When you look at different ways to boost health savings account (HSA) engagement for your employees, strategic communications is just one part of the equation.  Taking your employees on a journey from spenders to savers to investors also requires thinking about how you structure the plan itself.  With the right kind of incentives, you can have your employees contributing and investing in their accounts on their way to better financial health. 

Plan Design is Key

It all starts with plan design. There are  three possible strategies that employers can utilize here: seed, match, or reward:

Account Seeding: When you seed your employees’ accounts, you make a lump-sum contribution to encourage your employees to establish an HSA and begin to use the account. The catch here is that your employees may or may not want to go further. 

Account Matching: Matching is similar to a  401(k) plan.  The difference here is that with an employer match your employees now have an incentive to keep putting their pre-tax money into their HSA  plan.  

Rewards: Rewarding your employees with cash or stock rewards at strategic points will encourage them to keep them moving forward throughout their journey. Meanwhile,  you’re optimizing your program in a way that encourages people to come in, take a look around, and begin the educational process.  It’s also important to celebrate your employees’ wins to solidify the savings habit. By using tech and non-tech strategies you can reward and celebrate your employees’ important HSA milestones, such as saving half of their HDHP deductible or making their first investment. You can also work with them to set a realistic HSA savings goal to meet their health and retirement needs.  

Is there one method that is preferable over the other? According to behavioral science, reward and match work better than account seeding. While seeding works, the idea of giving employees free money without asking them to contribute or invest doesn’t help your employees, in the long run, to move them towards their long-term retirement goals.   

Through the use of a match, rewards, celebrations, and an incremental communication strategy you can assist your employees to understand the incredible benefits of the HSA and put them on the path to a healthy retirement.

Join us live every week on the Right Way to HSA at 12 pm PT on LinkedIn & Twitter. This week we discuss:

  • Three strategies that have the biggest impact on employee behavior.
  • Some strategies that 401k plans use that are also applicable to HSAs.

Can’t watch us live? Watch the replay on Youtube, LinkedIn, and Twitter! 

Subscribe to SavingsOak Academy:

Don’t miss out on a single post! Have useful HSA information delivered straight to your inbox.

    Recent Posts

    Your Guide to HSA and Tax Time

    Your Guide to HSA and Tax Time

    Tax season is upon us. Whether this is your first year with an HSA or you need a little refresher, we have compiled a guide to help you during this tax time.

    HSA vs. 401(k): How Much Should You Contribute?

    HSA vs. 401(k): How Much Should You Contribute?

    When it comes to contributing to HSA and a 401(k), there isn’t an easy answer. Depending upon your situation, the answer could vary. We review a couple of possible strategies.