For employers, supporting employees’ financial wellness isn’t just a buzzword—it’s a strategic priority for 2026. Benefits leaders increasingly recognize that financial stress doesn’t stay at home when employees clock in. It impacts productivity, retention, and long-term employee well-being. In fact, nearly 47% of employers plan to offer financial wellness programs by 2026, underscoring the growing recognition that benefits must go beyond traditional compensation and health coverage to support employees' financial stability.
Today, addressing financial wellness means looking beyond traditional retirement benefits to the health plan itself, which can be a major source of financial strain. Rising deductibles, out-of-pocket costs, and medical debt contribute to employees borrowing from their retirement savings to cover care. According to Vanguard, early withdrawals from 401(k)s due to financial hardship have more than doubled from pre-pandemic levels, with a record 4.8% of account holders taking early withdrawals in 2024.
The Health Payment Account (HPA) is one solution employers are embracing to make healthcare costs more manageable and to protect tax-deferred savings in HSAs and 401(k)s. We wanted to better understand the impact of the HPA's flexible payment solution on the broader financial wellness of our employee groups. To do that, we looked at the patterns of 401K borrowing as a metric of financial resilience, and it revealed a promising trend: employees with access to Health Payment Accounts (HPAs) are borrowing less from their 401(k)s, preserving their long-term financial security.
How HPAs Strengthen Financial Resilience
A Health Payment Account (HPA) empowers employees to pay out-of-pocket healthcare costs whenever they need care and repay over time through more predictable interest-free payments. Unlike traditional credit cards or medical loans, HPAs eliminate the burden of interest and fees, and give employees certainty that they can afford healthcare costs when they arise.
The financial impact of this flexible payment solution for healthcare has a wide-ranging impact:
- Fewer Employees Turn to Interest-Bearing Debt—According to a recent survey, 31% of Paytient HPA users avoided taking on interest-bearing debt at their provider’s office.
- Employees Using HPAs Have Paid Off Other Debts—33% of members reported paying off other debts because they could manage their medical expenses with an HPA.
By reducing reliance on high-interest credit and short-term loans, HPAs enable employees to maintain financial stability without depleting their savings or tapping into retirement funds.
The 401(k) Impact: A Data-Driven Look
To understand the broader impact of HPAs on financial resilience, we analyzed 5500 filings—Department of Labor reports on employer retirement plans—for companies that had implemented HPAs for at least one year prior to 2023. The findings were significant:
- HPAs were correlated with a 6% reduction in 401(k) borrowing across participating employers vs the prior year.
- Trends varied by industry. Legal services firms, for example, had lower overall borrowing but still saw improvements in employee financial security.
- In industries with higher loan rates, such as utilities, where nearly 5% of total plan assets were on loan and nearly 20% of employees had active 401(k) loans, the impact was even greater.
These trends matter because the scale of retirement borrowing is staggering. Large companies alone (those with full 5500 filings, which are generally limited to firms with over 100 eligibles) had $78 billion in outstanding retirement plan loans in 2023, accruing more than $4 billion in interest. This means employees are not just borrowing from their future—they’re paying a steep price to cover immediate financial gaps, often caused by healthcare expenses.
While financial hardship withdrawals and 401(k) borrowing increased nationwide, employers offering HPAs saw the opposite trend. This suggests that when employees have access to flexible payment solutions for healthcare, they’re less likely to raid their retirement savings to cover medical costs.
Rethinking Benefits to Reduce Financial Strain
Most employers design their benefits with the best intentions, yet many are unknowingly contributing to employees’ financial stress. High-deductible health plans (HDHPs) may have cost-effective premiums, but they often leave employees vulnerable to medical expenses that disrupt their financial security.
Employers are embracing flexible payment solutions like the HPA to::
- Reduce the need for 401(k) withdrawals and loans
- Support long-term financial wellness without increasing costs
- Create a more resilient workforce by eliminating financial barriers to care
- Empower more employees to elect lower premium HDHPs, freeing up dollars for employees to put away in tax-deferred accounts.
Financial stress doesn’t just impact employees—it affects business outcomes. Retention, productivity, and employee satisfaction all suffer when workers are forced to choose between their health and their financial stability. Employers have the power to change that.
Final Thoughts
For too long, financial wellness strategies have focused on retirement readiness while ignoring the biggest financial disruptor employees face today: unexpected healthcare costs.
Our latest analysis shows that when employers integrate flexible healthcare payment solutions into their benefits package, they aren’t just helping employees afford care—they’re strengthening their financial foundation for years to come.
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