Health and wellness spending account wisdom

Navigating Health Spending Accounts

Top tips for insurance brokers, advisors and employers: Part 2

This week we continue our series on navigating health spending accounts; top tips for insurance brokers, advisors and employers. Last week we discussed the two HSA products available; the prepaid Mastercard® option versus the traditional pay-as-you go model.  This week we will explore what is the best type of plan for your clients or for your employees? Should you offer a traditional group benefits plan that has defined expenditures and a narrow list of what is and what is not covered.  Or, should you provide a stand alone health spending account that provides greater flexibility for what is covered and how employees can spend on their health related expenses. Today we are seeing more and more companies choosing standalone health spending accounts as their choice for employee benefits.

A recent Benefits Canada survey showed that 78% of the respondents offer a traditional benefits plan while the remaining 22% offer a flexible plan that allows the plan members to choose the level of coverage. In addition to that 39% of the respondents who do offer a traditional benefit plan also have a health spending account.

Let’s continue exploring health spending account choices by looking at stand-alone health spending accounts versus traditional group benefits with a health spending account added in addition.

Tip 2: Choosing between a stand alone health spending account versus a traditional group benefit plan with a health spending account added to it

A stand alone health spending account provides employers with cost certainty, knowing exactly how much their health benefit expenses will be on an annual basis.  In addition, employers only pay for approved claims all while being a tax deductible expense.  Providing employees with a health spending account allows them the flexibility they like so they can spend on the benefits they choose.  

Adding a health spending account on top of traditional group benefits also has its benefits for both employers and employees.  For employers it provides employees with additional funds to use on any of the numerous benefits that are not typically covered under group benefits. An even greater benefit to employers is the satisfaction it provides employees around their benefits and their employer. For employees it provides them with additional funds to use in areas they may have maxed out or on expenses not covered by their benefits plan. The Canadian Government has a full list of eligible HSA expenses.

Health spending accounts should play a part in your employee group health benefits, be it as a standalone product or in addition to a traditional plan as a way to retain employees and offer a plan that fits their needs.  

If you would like to learn more about health spending accounts and how they can fit into your employee group benefits, don’t hesitate to reach out to Our team can answer all your questions and provide you with insights on how health spending accounts can benefit you and your organization. And watch this space for more tips on navigating HSAs for your clients or your business.

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