Issue Spotlight: Health Savings Accounts

A health savings account (HSA) is a type of tax-advantaged savings account available to consumers enrolled in High Deductible Health Plans (HDHPs) to use for certain healthcare expenses. The prevalence of HSAs among consumers has surged in recent years, with approximately 36 million HSAs reported in 2023. These accounts collectively hold over $116 billion in assets, representing an increase of more than 500 percent since 2013. This significant growth has coincided with the rising prevalence of HDHPs, as HSAs were established to provide tax benefits to individuals with HDHPs.

An HSA typically has an underlying consumer deposit account, and while HSAs share similarities with healthcare spending accounts like flexible spending accounts (FSAs) and certain tax-advantaged retirement accounts, they also have distinct elements. This report examines these unique characteristics and evaluates consumer experiences in the HSA market. Overall, while the tax benefits associated with HSAs may add value for certain consumers, HSAs also present increased costs, primarily in the form of fees and low interest rates.

FULL REPORT

Health Savings Accounts

Related resources

CFPB Finds Junk Fees and High Costs Pervade Health Savings Accounts

Statement of CFPB Director Rohit Chopra on Medical Financial Products