Many U.S. consumers still are trying to regain their financial footing after the pandemic. More than half have taken steps to reduce health care costs over the last two years, including nearly one in five who have done so by not paying other bills, such as rent, car payment or utilities.
Other steps taken to reduce health care costs include reducing the amount of money they had planned to save (26%); borrowing money (18%); deferring needed health care (16%); and not filling a prescription (16%).
“Today, health care decisions are inextricably linked to our financial well-being,” said Steve Betts, head of Fidelity Health. “The complexity of the health care system can be staggering.”
Consumers can take several steps to make the most of available benefits, according to Fidelity. These include:
- Understanding the full array of health benefits available outside of traditional insurance coverage (for example, telehealth or live navigation services);
- Leveraging tools that interact with the system to help find the best care; and
- Saving and paying for health care using a health savings account, which 88% of Gen Zers with a high deductible health plan say they’ve opened, far above the 71% of eligible respondents who say the same.
HSAs stand out because of the ”triple tax advantage,” meaning that contributions may be tax-deductible, the money in an HSA can be spent tax-free on qualified medical expenses and any growth is tax-free, according to Fidelity, one of the largest HSA providers. The asset manager reported significant growth in its health business, with more than $16 billion in total HSA assets, up from nearly $14 billion last year.
“Meeting the rising cost of health care continues to be a concern for Americans, particularly as inflation impacts household budgets,” said Begonya Klumb, head of health and benefit accounts for Fidelity. “We see time and again that savers with access to an HSA are able to use the triple tax advantage to become better prepared for the cost of health care, both today and in the future.”
Although a comprehensive benefit package is important in a tight labor market, only 35% of employees strongly agree that their health benefits meet their own or their family’s needs. Fewer than one in five health benefits leaders said their company offers navigation services that help coordinate employees’ care across multiple providers.
“We know having the right health benefits strategy can help combat rising costs and drive employee engagement,” Betts said. “It’s not simply about the benefits themselves but how they all work together to help employees navigate their health benefits choices with confidence.”