How to Increase HSA Participation at Open Enrollment: An Employer Playbook

Most low HSA elections aren't a persuasion problem — they're a UX problem. Employees guess low because the enrollment screen doesn't tell them what the account is worth, what it costs per paycheck, or how much they're allowed to put in. Fix the screen, and elections move: one employer saw committed contributions jump 38% per participant in a single enrollment cycle.

Why Employees Guess Low

When an employee hits the HSA election screen, they're usually making a snap decision with three pieces of missing information. The result is a defensive, round-number election — $500, $1,000 — that has little to do with their actual medical and wellness spending.

Three failure modes show up over and over:

• Confusion about what an HSA even is. Many employees can't articulate the difference between an HSA and an FSA, so they treat the HSA like the riskier account and elect accordingly.
• Use-it-or-lose-it fear bleeding over from FSAs. FSA forfeiture rules are real — funds expire outside a limited carryover or grace period. HSA dollars never expire and belong to the employee. But employees who've been burned by an FSA apply the same fear to the HSA and under-elect to stay "safe."
• No sense of scale. Without the IRS limit on screen, employees have no anchor. For 2026 the limits are $4,400 individual and $8,750 family (plus a $1,000 catch-up at 55+) — see the full breakdown in our 2026 contribution limits guide. An employee who doesn't know the ceiling exists rarely elects anywhere near it.

Every dollar left unelected costs both sides. The employee gives up 25–35% in tax savings on money they'd spend on healthcare anyway, and the employer pays 7.65% FICA on wages that could have been pre-tax contributions.

Put Three Numbers on the Election Screen

The single highest-leverage change is showing employees the right numbers at the moment of decision:

1. The employer match or seed contribution. If you contribute, say so on the screen — not in a PDF. "We contribute $1,000 when you contribute at least $1,000" turns an abstract account into free money with a clear action attached.
2. The per-pay-period cost. $4,400 a year sounds enormous. $169 per biweekly paycheck — shown next to the estimated tax savings that offset roughly a third of it — sounds manageable. Let employees toggle between annual and per-paycheck views.
3. The IRS limit, framed as a target. Show the 2026 limit and how far the current election is from it. Anchoring matters: employees who see "$1,000 of a possible $4,400" elect differently than employees who see a blank box.

Use Defaults and Prompts, Not Just Education

Benefits education has a shelf life of about one webinar. Choice architecture works every year without a meeting:

• Pre-fill a meaningful default. If your plan design allows it, defaulting the election to last year's amount — or to the match-maximizing amount — beats defaulting to zero. Employees can always change it; most anchoring research says many won't.
• Prompt at the moment of under-election. A simple in-flow nudge — "You're leaving $500 of employer match on the table" or "Employees with family coverage typically elect more than this" — catches the guess-low reflex before it's committed for the year.
• Separate the HSA from the FSA visually. If the two accounts look identical on screen, employees import FSA fear into the HSA decision. Label the HSA's rollover and portability explicitly: "This money never expires and goes with you if you leave."
• Make the deadline loud and the process short. Long, multi-session enrollments lose people. A tight, all-digital flow with clear reminders finishes stronger.

For the broader communication cadence around enrollment — what to send, when, and to whom — see our open enrollment communication playbook.

What Good Enrollment UX Actually Delivers

This isn't theoretical. In a completed open enrollment at a $1B tech company that switched to Hammock:

Metric	Before	After
Committed per participant	$4,039	$5,561 (+38%)
Elections at the IRS max	~20%	64%
Enrollment duration	Weeks, paper-heavy	Six days, all-digital
Employer FICA saved	—	$234 per employee per year (across total elections)

The FICA line deserves attention because it accrues to you, not just employees. Every incremental pre-tax dollar an employee elects is a dollar you don't pay 7.65% employer FICA on. The 38% lift alone is worth $100+ per participant per year (~$116 at the observed averages) — roughly $11,600 annually at 100 participants, ~$58,000 at 500, and ~$232,000 at 2,000. The headline $234 per employee is employer FICA extrapolated across total elections, not just the increase. Actual results vary with participation and election mix, but the direction is mechanical: higher elections, lower payroll tax.

Notably, the previous administrator at this company had reported the employer match as $0 all year — employees literally couldn't see the money. Visibility wasn't a nice-to-have; it was the whole problem. If your current administrator hides the match, switching may do more for participation than any campaign.

How Hammock Helps

Hammock is a full HSA and FSA administrator built around the enrollment experience: the match, per-pay-period cost, and IRS limit are on screen at the moment of election, with defaults and prompts that counter the guess-low reflex. Enrollment runs all-digital — the case study above closed in six days — and employee education and enrollment sessions are included, run by a dedicated account manager.

Because Hammock also unlocks wellness spending (gym, supplements, massage) through Letters of Medical Necessity, employees have a concrete reason to elect more: they can see eligible spend they're already making. HSAs can move any time of year, so you don't have to wait for renewal to fix enrollment.

FAQ

Why do employees under-contribute to HSAs?

Mostly confusion and misplaced fear: they conflate HSAs with use-it-or-lose-it FSAs, don't know the IRS limit, and can't see the employer match or per-paycheck cost at the moment of election. Fixing the enrollment screen addresses all three.

What's a realistic lift from improving HSA enrollment?

In a real completed enrollment, committed contributions rose 38% per participant ($4,039 to $5,561) and max-limit elections went from ~20% to 64% of participants. Your results will vary with plan design and workforce mix, but double-digit lifts from UX changes alone are achievable.

Does higher HSA participation actually save the employer money?

Yes. Employer and employee pre-tax HSA contributions are exempt from FICA, so every incremental dollar elected saves the employer 7.65%. The case-study lift was worth $100+ per participant per year on the increase alone; measured across total elections, employer FICA savings came to $234 per employee.

Do HSA elections have to happen at open enrollment?

Unlike FSAs, HSA contribution amounts can generally be changed during the year, and HSA administration can move any time of year. Open enrollment is still the moment of maximum attention, so it's the highest-leverage window.

Should we contribute an employer match to drive participation?

A match is the strongest single lever — but only if employees can see it. Contributions run through a Section 125 cafeteria plan for most employers (with nondiscrimination testing) or follow comparability rules outside one; worth confirming the structure with benefits counsel.

The Bottom Line

HSA participation is won or lost on the election screen. Show the match, the per-paycheck cost, and the IRS limit; default and prompt against the guess-low reflex; keep the flow short and digital. The employers who do this see meaningfully higher elections — and pocket 7.65% FICA on every incremental dollar.

Want to see what your enrollment could look like? Talk to our team.