How Pfizer drove HSA engagement through smart plan design and economic inclusivity

When Pfizer’s workforce began requesting Health Savings Account (HSA)-qualified health plan options, the pharmaceutical company knew it would need a partner that could address the needs of employees across diverse income levels. Its higher-paid workers were already attracted to the tax savings vehicle. However, its lower-paid employees would need more support to take advantage of an HSA.

Pfizer’s position is familiar to many organizations facing today’s exorbitant healthcare costs. Employers have seen the total annual cost of premiums for family coverage skyrocket 24% in the last five years, according to KFF data.¹ They need solutions that will curb healthcare spending — for themselves and for their employees.

But one-size-fits-all solutions don’t perform well with today’s diverse workforces. That’s why Pfizer and many other organizations are partnering with HSA administrators to leverage customizable accounts that boost savings for employers and employees of all types.

Why Did Pfizer Turn to HSAs?

The high cost of healthcare isn’t the only frustration today’s employers face. As they prepare for another year in which health benefit costs are forecast to rise more than 5%, they’re facing a slate of related problems.²

Budget constraints jeopardize employers’ benefits strategies, for example. As organizations consider cutting programs, they must weigh the impact of scaled-back offerings designed to boost employee morale and well-being.

Employers are also paying special attention to workers’ financial standing. After all, employers aren’t the only ones facing a surge in healthcare costs. Over the last five years, employee healthcare expenses have climbed by roughly 5%, adding an average of $300 to their burden, according to KFF.¹

The cost increase has impacted workers’ health-related decisions. Industry data shows that prices have driven many employees to forgo prescription medications or defer care altogether.³

With some workers increasingly stressed about money—both on and off the job—employers may feel pressured to offer tools that employees can use to boost their savings.

This kind of pressure is what motivated Pfizer to seek an HSA. Employees were asking for tools that would generate savings. However, the company needed to identify a solution that would offer lower-cost health plans while also ensuring broad pre-deductible coverage for allowable medications and services.

Selecting an HSA administrator

When an employer begins the search for an HSA administrator, it should look for a partner that aligns with its strategic priorities.

Pfizer needed an administrator that could offer tailored solutions designed for its diverse workforce. Pfizer’s benefits leaders knew an HSA offering would excite higher-paid workers, many of whom were already looking for tax savings vehicles.

An HSA would more than satisfy this desire with its trademark triple-tax advantage:

All dollars contributed to the account are tax-free.
The money in the account grows tax-free.
The money spent on medical care is tax-free.

But Pfizer wanted to support all of its workers, including lower-paid individuals who may be less familiar with the advantages of an HSA. Crucially, the organization knew it needed to continue providing access to affordable, comprehensive healthcare coverage.

Pfizer’s approach mirrors a growing challenge for many employers: the need to balance rising healthcare costs with employees’ demand for high-quality benefits in order to effectively recruit and retain talent. In other words, organizations need to curb costs, but they can’t risk disappointing talent by cutting valued benefits or offering solutions that assist one sector of workers while alienating another.

Ultimately, Pfizer chose HealthEquity as its HSA administrator. After working with Pfizer to fully understand its challenges, HealthEquity offered a plan design tailored to those needs, featuring four income-tiered contribution levels to help meet Pfizer’s goals of better serving their economically diverse workforce. The customized approach drove interest and participation among employees with less interest in or familiarity with HSAs. Lower earners also receive the largest employer HSA contribution when they sign up, bolstering their savings from the outset.

Additionally, all employees benefit from a broad range of allowable preventive services and medications covered before the deductible.

An enrollment-focused approach to implementation

Choosing an administrator is just the first step in a successful HSA partnership. An effective rollout is key to driving adoption among employees. Vendors must understand the importance of this stage — and provide the strategies and materials to support it.

When Pfizer was ready to implement the HSA it designed with HealthEquity, it focused on providing a wide array of materials.

This omnichannel strategy demonstrates the HealthEquity approach to employee education: focusing on key decision points and misconceptions, so employees get the right information exactly when they need it.

To support Pfizer throughout the implementation period, HealthEquity:

Hosted customized webinars.
Created tailored flyers.
Executed email promotions.
Built a dedicated online employee education center.

These tactics fueled a campaign to educate colleagues about their new benefit, ensuring they had the information to take full advantage of the offering when open enrollment arrived.

Celebrating the results

Pfizer’s implementation was successful: Roughly one in three Pfizer colleagues chose the HSA-qualified health plan option. Though the organization is in the early years of offering the benefit, its leaders believe the HSA has proved attractive so far — including to lower-paid colleagues, more than one-third (37%) of whom elected coverage.

Also worth celebrating: 11% of colleagues enrolled in the plan began investing their HSA funds, which exceeds the 8% industry average reported by Devenir.⁴

As shown by Pfizer’s partnership with HealthEquity, by offering an HSA, organizations can provide workers with exceptional benefits that curb healthcare spending for both employers and employees.

For employers, HSAs are a powerful tool for those organizations looking to manage rising healthcare expenses. Employers offering the accounts alongside high-deductible health plans (HDHPs) pay lower premiums than those of more expensive plans. According to KFF data, the average HDHP premium is more than $1,000 lower than the average PPO premium.⁵ HSAs also provide cost savings by incentivizing employees to spend their healthcare dollars more carefully through better consumerism.

For employees, they also enjoy the lower premiums associated with HDHPs or another HSA-qualified plan. When the average HDHP premium cost savings are added to HSA tax savings, members see an annual savings of about 16% compared to the average cost of a PPO plan.⁶ In 2023, this amounted to over $600 in annual savings for employees.

HSAs also create long-term savings for employees. In fact, because of their triple-tax advantage, HSAs are an even more powerful savings tool than a 401(k). In the best case scenario, employees who start early and who understand how to take full advantage of their HSA through investing can generate more than $1 million throughout their lifetime.⁷

Start saving with HealthEquity

Today’s employers face a triple-sided challenge:

Healthcare costs are eating up an increasing share of company budgets.
Talent expects high-quality (and sometimes high-cost) benefits.
Employees are struggling with their finances, sometimes to the detriment of their health, driving healthcare costs even higher.

By offering an HSA, employers can find relief for each of these challenges. HSA accounts curb healthcare costs for employers and employees, preserving funds for employers to offer a well-rounded suite of benefits. Meanwhile, HSAs are a savings tool for employees — for today, tomorrow, and the future.