B U S I N E S S P U L S
How Hot are HSAs? They’re Kaiser Family Foundation, just 7%
VERY Hot in the Frozen Tundra!
Health Savings Accounts are being
touted as a long-term initiative to
control rising healthcare cost.
These plans are being embraced to
expand consumerism in healthcare
CEO so employers and employees become
more responsible for their personal
care - and much more sensitive
Cure all for to the cost.
HSAs are being sold as a significant
Healthcare? tool to help business owners control
their cost and ultimately, develop
a healthier workforce of engaged,
‘incentivized, productive people.
Does your organization
offer a HSA plan?
Yes, Offer
HSAs: 30%
Do NOT Offer
HSAs: 70%
CEOs and business owners in NEWi
continue to be substantially more
likely to be using Health Savings
Accounts than their counterparts
nationally. Thirty percent of CEOs
and business owners in NEWi say
their organizations are currently
offering HSAs. According to the
Executive Summary:
Data Gathered Jan/Feb 2007
A Special Report: Part TWO
“I’m not getting information; I'm not managing.”
John Torinus, President & CEO — Serigraph, Inc
E©
of employers nationally offer a
HSA. HSAs have been offered by
organizations for varying periods of
time since their introduction in 2003.
Among those who currently do offer
such plans, 34% have offered HSAs
to employees for at least two years;
23% say HSA plans have been
available to their employees for one
year; 42% indicate their HSA plan
has been available for less than a
year. Seventy-three percent are
contributing funds to the
employees HSA.
Among those not providing a HSA
option, there is considerable interest
in making them available in the
future. Six-out-of-ten indicate that
they are considering having HSAs
as part of their future health care
benefits package; 30% say they
are not considering HSAs and 10%
are not sure what their future
benefits may bring.
Popular with
employees, too
Organizations offering HSAs
experience substantial variations
in employee participation. In some
organizations, there is a high level
of participation by employees, while
in others the participation rate is
relatively low. In NEWi, 42% of
CEOs indicated that 75% or more
of employees enrolled in their HSA
plan; 21% have a participation rate
of 50-74%; 25% have participation
rates between 25-49%;
just 4% have less.
The high level of variation in
participation may exist for a
number of reasons. It may relate
to the nature of the specific
structure of the HSA Plan (e.g.
is the company is contributing
dollars to the employee’s health
savings account - or only the
employee is putting pre-tax money
in directly from their paycheck).
It could also vary according to
the age distribution within the
organization or, it could be due
to the HSA product being so
new, that employees want to
see how they work for other
employees first.
It is clear, however, that CEOs
with HSAs are convinced that
they are beneficial to CEOs:
85% have selected the HSA
option for themselves.
How confident are you that your employees will make
wise healthcare decisions with their HSA plan?
In a consumer-driven healthcare
system, in which defined
contribution plans, health savings
accounts and health reimbursement
accounts are prevalent, employees
have much more responsibility
in deciding when and how to
purchase healthcare. But, will
consumers make wise health
care decisions in this new
environment? CEOs aren’t sure.
The Business Pulse indicates that
CEOs and business owners are split
on how confident they are that
employees will make wise healthcare
decisions with a HSA plan. Only
16% are very confident that
employees will make wise decisions;
40% are moderately confident;
30% are only somewhat confident,
11% say they are not confident
at all and 3% are not sure.
New legislation makes
HSAs more attractive
In December, President Bush signed
the Health Opportunity Patient
Empowerment Act of 2006. This
new law was part of the Tax Relief
and Health Care Act of 2006 and
provides several new options for
organizations using HSAs.
Some of the new provisions
include:
• Allows rollovers from Flexible
Spending Accounts (FSAs) or
Health Reimbursement Accounts
(HRAs) into HSAs;
• Increases the annual HSA
contribution to $2,850 for
self-only coverage or $5,650 for
those with family coverage;
• Provides for full annual HSA
contribution regardless of
the month the individual
becomes eligible;

Very Confident 16% • Allows a one-time transfer from

IRAs to HSAs, the transferable
Moderately Confident 40% amount is limited to the
maximum HSA contribution
Only Somewhat Confident 30% for the year;
• Provides for greater contributions
Not Confident 11% for lower-paid employees.

Not Sure 3% While HSAs are relatively new, they

appear to be a relatively simple tool
0% 5% 10% 15% 20% 25% 30% 35% 40% 45% for organizations to help manage
their healthcare costs.

Sources/Resources
Kaiser Family Foundation, Employer Health Benefits 2006. http://www.kff.org/insurance/7527/upload/7528.pdf
President Bush signs the Health Opportunity Patient Empowerment Act of 2006. http://www.treasury.gov/press/releases/hp209.htm
Treasury, IRS Issue Guidance Helping Employees Transition To HSAs. http://www.treas.gov/offices/public-affairs/hsa/pdf/jct_hsa_description.pdf

How the Survey is conducted

The Nicolet Bank Business Pulse© is a Quarterly Study of CEOs in NE Wisconsin (Brown, Calumet,
Door, Kewaunee, Manitowoc, Marinette, Oconto, Outagamie, Shawano, Winnebago Counties). Interviews
were conducted with an online representative sample of CEOs and business owners between January 12
and February 7 2007. The study is designed and implemented by IntellectualMarketing, LLC.
Participants include: 28% in manufacturing; 25% in services; 18% retail trade; 5% wholesale trade; 6%
finance, real estate, insurance; 5% in transportation, communications, utilities; 6% in construction; 8% in
other industries. 19% have fewer than 6 employees; 31% have 6-25; 16% have 26-50; 13% 51-100; 13%
101-250; 5% 251-500; 2% 501-1,000; 2% have 1,001 or more.
Questions to Dr. David G. Wegge (920) 217-7738; statguy@aol.com