Balances in health savings accounts increased slightly in the first quarter from fourth-quarter 2008 levels, according to data from Canopy Financial Inc.
The average balance in an individual health savings account rose 3 percent to $960 during the first quarter, while the average balance in a family HSA grew by 7 percent to $1,720, according to San Francisco-based Canopy Financial, a provider of health care banking technology solutions.
HSA balances also grew compared with the year-earlier period. The average account balance was $697 for individuals and $1,419 for families in the first quarter of 2008.
Contributions have also climbed for both employers and employees.
During the fourth quarter, the average monthly employer contribution was $69 and $133, respectively, for individuals and families. In the first quarter, that increased to $113 for individual HSAs and $266 for family HSAs.
Similarly, employees are also placing more money into their accounts.
Average contributions for an individual HSA were $111 for individuals and $206 for families in the fourth quarter of 2008. That rose slightly to $116 for individuals and $239 for families during the first quarter.
Steady contributions from employers and employees kept the HSA balances growing amid the recession in the first quarter, noted Vik Kashyap, chief executive of Canopy Financial.
“A high percentage of the employers that offer these accounts are contributing into the HSA,” he noted. “They fix the contribution on a monthly basis, so that it’s made irrespective of how the economy is doing.”
Interestingly, while employees likely felt the squeeze on their dollars during the first quarter, they were fine with chipping into their HSAs, he added.
“You’d expect people to not be contributing, but there’s a tax advantage here,” Kashyap noted.
Account holders also increased the amount of money that they transferred to investments.
In the first quarter, account holders transferred an average of $1,372 to investments from individual HSAs and $2,633 from family accounts, compared with $1,167 for individual accounts and $1,978 from family HSAs in the fourth quarter.
Amounts of money transferred into the account from investments also rose, with an average of $722 transferred in from investments for individual accounts, up from $540 in the fourth quarter.
Meanwhile, on the family side, the amount transferred from investments dropped, falling to $1,157 from $1,556 in the fourth quarter.