Data collected from Devenir Group, by surveying top health savings account (HSA) providers, reflects both a consistent trend toward account growth and a “savings mindset” taking root among healthcare consumers. The new study shows the popularity of HSAs and their continued to grow, with the number of accounts now exceeding 18 million and total assets approaching $35 billion, according to the study.

“We are seeing consistent growth in new HSA accounts at a growth rate in excess of 20 percent year over year and we expect that to continue for the next couple of years,” said Jon Robb, Devenir’s senior vice president of research and technology, in announcing the results of the 12th semiannual Midyear HSA Survey.

As of June 30, there were 18.2 million HSAs, up 25% from one year earlier, Devenir found. Likewise, the total assets of $34.7 billion represented a 22% rise from June 30, 2015, levels, and $4.7 billion of this total took the form of investment assets.

Meanwhile, only 20% of HSAs were unfunded in the first half of 2016, down from 24% at the end of 2015. By the end of 2018, the HSA market was projected to exceed $50 billion in assets, spread over more than 27 million accounts.

Of the total number of new accounts, 35% were connected to health plans, making health plans the leading driver of new account growth, the report noted. “As health coverage continues to become more consumer-oriented, individuals are becoming more engaged and invested in managing their health and health care dollars,” said Eric Remjeske, president and cofounder of Devenir, which provides investment solutions for HSAs and the consumer-directed health care market.

While more and more people are opening HSAs each year, the individuals who opened accounts in 2005 and 2006 have the largest average account balances by nearly $2,000. On average, those who opened HSAs in 2005 had a balance of $7,622 midway through 2016, and those who opened accounts in 2006 had a balance of $6,781, according to the report. Individuals who had opened accounts so far in 2016 had an average balance of $693.

Contributions and withdrawals

The amount of contributions and withdrawals has been increasing year after year. In 2013, industry contributions were $16.4 billion, which rose to $19.4 billion in 2014 and $22.8 billion in 2015. Withdrawals recently have been increasing at a greater rate: $12.4 billion in 2013, $13.4 billion in 2014 but then $16.9 billion in 2015.

As a result, the amount of money carried forward declined slightly to $5.9 billion in 2015 after peaking at $6.2 billion in 2014, noted the report. (The partial figures for 2016 appear to continue these trends.)

Debit cards have remained the most popular method for HSA withdrawals so far in 2016. The report showed 85% of withdrawals per account were made via debit card, compared to 7% made by online bill payment and 5% made by check. Although debit cards were used more often, the average transaction amount ($120.85) was less than those made through check ($291.71) or online payments ($326.14).

Investments

Since 2006, the percent of investment assets in HSAs has seen an increase from 7% to 14% in 2015 (with 15% projected for 2016). Devenir predicts this upward trend in investments will grow to $8.7 billion (17% of HSA assets) in 2018. The average HSA investment account holder had a $15,092 total balance (deposit and investment account combined), which was more than seven-and-one-half times the average balance for a noninvestment account holder, according to the report.