Employee retention is in the forefront of employers’ minds.  Benefits are just one of the tools utilized in employee retention.  Out of the abundant benefits employers can choose from, Health Savings Accounts (HSAs) are at the top attributed to their tax advantages and portability.

Employers are finding rapidly increasing health insurance costs due to the complex regulation in the Affordable Care Act (ACA) implying that High Deductible Health Plans (HDHP) are here to stay.  A strategic component of a HDHP is the eligibility to open a tax haven known as the Health Savings Account (HSA).

HSAs, unlike Flexible Spending Accounts (FSAs), are portable, following the employee when they are no longer employed.   Balances at the end of the year are left in the employees HSAs and are not lost if not used in the case of FSAs (use it or lose it).  According to Flyte HCM’s President Eric Allen, FSAs are plummeting in utilization in favor of HSAs.  “Employers are finding they have less risk up front offering HSAs.”  In the case of Health FSAs the employee is eligible to spend the entire FSA amount elected immediately and could then quit employment, leaving the employer short funds that were not collected.

For a robust employee benefit package, Health Savings Accounts can be paired with limited FSAs (ie. vision and dental), Dependent Care, and Parking and Transit for additional pre-tax savings.

HSAs are the new IRAs but with fewer rules and triple tax advantage!!   Not only can contributions be made pre-tax, but investments along with interest and earnings are tax free.  HSA (tax free) funds then can be used to pay for health care expenses, long term care, and in certain instances, COBRA and health insurance premiums.

Whether your goal is employee retention or having a robust benefits package, Health Savings Accounts are a win for both employers and employees acting as a retirement plan that is virtually tax free with low employer risk.


Flyte HCM is proud to deliver the only true multi-account solution for HSAs with a single platform, a debit card, and mobile app designed to make the HSA experience seamless and easy. For employers, we provide a comprehensive, one-stop, compliant HSA administration solution with in-depth reporting, white-label custodian, and a single administrator.

Curious and ready to learn more about how we can help your business? For more information, give us a call today at 952.746.0000 or email: Quotes@FlyteHCM.com