Health Savings Accounts for Small Businesses and Entrepreneurs: Shopping, Take-Up and Implementation Challenges

A combination of high deductible health plans (HDHPs) and health savings accounts (HSAs) holds promise for expanding health insurance for small firms. We provide information on HSA take-up and shopping behavior from a 2008 survey of female small business owners, revealing that the HSA marketplace can be confusing for small firms. HSAs may have expanded access to health insurance for the smallest firms (under three employees), but not for small firms more generally. A sizable number of firms offering HSA-eligible insurance did not offer attached HSAs. Firms offering HSAs were satisfied with their experiences, but faced challenges in implementing them. Acknowledgments This research was conducted within the Kauffman-RAND Institute for Entrepreneurship Public Policy, and funded by a grant from the Ewing Marion Kauffman Foundation to the RAND Corporation. We would like to thank the small business owners and members of Women Impacting Public Policy (WIPP) for taking the time to respond to our survey. This work would not have been possible without their input. We thank Barbara Kasoff of Women Impacting Public Policy for allowing us to field this survey with the membership base of WIPP and for providing comments on drafts of the survey instrument and this paper. Melinda Beeuwkes Buntin, Elaine Reardon, John Romley, and Carole Gresenz provided input on the study design and the survey instrument. Julie Newell developed and fielded the web-based survey instrument used in this study. Any errors are the full responsibility of the authors. i RAND Corporation ii University of Minnesota and RAND Corporation iii School of Economics and Geary Institute, University College Dublin and RAND Corporation