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In this first-of-its-kind study, we examine the intersection of individuals who own both a health savings account (HSA) and a limited purpose flexible spending account (LPFSA). Employee Benefit Research Institute (EBRI)’s HSA and FSA databases contain information on nearly 300,000 accountholders who hold both accounts. Workers with both an HSA and an LPFSA contribute more to their HSAs than workers who only have an HSA ($3,419 vs. $2,289). Workers with both accounts contribute an average of $957 to their LPFSAs as well, suggesting that they are well-positioned to take advantage of the tax benefits these accounts offer. However, distribution activity suggests that workers are not fully taking advantage of these accounts. Accountholders with LPFSAs may be overestimating their expected spending on dental and vision expenses, and, for those with post-deductible LPFSAs, their total health care spending. • Among accountholders who have both an HSA and an LPFSA, 29% never took a distribution from their LPFSAs, and 63% still withdrew money from their HSAs. • Those with post-deductible LPFSAs were more likely to take a distribution than accountholders without the post-deductible feature, but 64% of LPFSA accountholders still withdrew money from their HSAs. Employers have an opportunity to better position their employees for short- and long-term health care spending and saving success by pairing an LPFSA with an HSA. But they also need to dedicate time to educating employees on the accounts’ benefits and how they can work together.

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Businesses are facing a seismic shift with the arrival of artificial intelligence (AI). Its transformative potential holds immense promise for employees, offering greater efficiency, improved accuracy, and enhanced client service. However, harnessing this power requires a strategic approach grounded in both ethical considerations and unwavering commitment to security.

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DeGarmo's assessments can help you see your best candidates faster. For more than twenty years, DeGarmo has supplied leading organizations with the information they need to make smarter hiring decisions. Our award-winning, mobile-optimized assessments quickly and accurately identify key strengths and growth opportunities to support the effective coaching and development of your people.

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