The Affordable Care Act (the ACA, better known as Obamacare) has apparently made health savings accounts (HSAs) more popular than ever. Here’s an update on these tax-smart accounts.
According to a survey conducted in July of this year by Devenir (an HSA industry participant based in Minnesota), the number of HSAs has surpassed 21 million, and the accounts now hold about $42.7 billion in assets.
These numbers represent year-over-year increases of 16 percent in the number of accounts and 23 percent in the amount of HSA assets. Devenir projects that by the end of 2019, there will be nearly 30 million HSAs holding over $60 billion in assets.
In 2010, the Employee Benefit Research Institute reported that there were 5.7 million HSAs with account balances totaling $7.7 billion. So HSAs are clearly becoming more popular.
The ACA Effect on Small Businesses
Before the ACA, a huge number of small businesses (defined under the ACA as those with fewer than 50 employees) used what were known as Section 105 medical reimbursement plans, also known as a health reimbursement arrangements (HRAs), to help their employees with the cost of health insurance and other health costs. But the ACA’s $100-a-day penalty that applied to reimbursing health insurance purchased individually by employees drove ... Log in to view full article.