Millennial employees—18 to 34 years old—selected high deductible healthcare plans more than any other age group. However, while approximately 44% of employees in this group chose HDHPs, a much smaller number of these employees took full advantage of health savings accounts (HSAs), according to Benefitfocus' inaugural “State of Employee Benefits 2016” report.

This report is a “snapshot” of actual, anonymous behavioral benefit selection data from more than 700,000 employees at 500 organizations on the Benefitfocus Platform®. It found that employees who are not taking full advantage of HSAs are leaving a significant amount of tax-free money on the table that could offset the cost high deductible healthcare plans (HDHPs) for them, says a press release.

Millennials in particular are missing a much greater opportunity, with the average single, 25-year-old employee contributing only about 22% of the maximum,” according to the report. This gap represents tax-free dollars that these employees are neglecting and could use to cover current expenses or to save for the future.

The results for Millennials are similar for traditional flexible spending accounts (FSAs), says the report, with employee contributions for both HDHPs and traditional plans running at 39% of the maximum. This percentage is low, especially since the 2016 FSA contribution limit is only $2,550.

It's possible that the low participation rate shows Millennial employees are being more cautious with their contributions because they know unused FSA funds will be forfeited at the end of the year, says Benefitfocus.

However, the report explains, unlike HSAs, all FSA contributions are immediately available at the start of the plan year before they are deducted from the employee’s paycheck, which can actually make these accounts an attractive option for Millennials and others. But, as with HSAs, FSAs appear to be largely underutilized by these employees.

The in-depth study, which used behavioral data, rather than the self-reported data analyzed in typical surveys, illuminates a larger trend—companies are altering their healthcare plan design to shift greater financial responsibility to employees, driving the need for a different approach to healthcare consumption.

Shawn Jenkins, CEO of Benefitfocus, explains that sophisticated enterprise benefits management systems, like the Benefitfocus Platform, are able to draw meaningful insights from actual employee behavior, which can include exploring ways to illustrate the value and impact of their benefits to employees.

“This is a quantum leap forward for chief human resources officers, chief financial officers, administrators, and all of us working to turn benefits into a strategic asset. This report provides a road map for policymakers looking to expand healthcare coverage while controlling costs,” Jenkins concludes.

To access the “State of Employee Benefits 2016” report, click here.