August 2006

$1.5 billion held in HSAs

Financial firms that administer Health Savings Accounts (HSAs) say they have opened more than 1.17 million accounts and manage about $1.5 billion in assets — up more than 50 percent since the beginning of the year, according to data gathered by Inside Consumer-Directed Care (ICDC) newsletter and reported in its Aug. 25 issue. The estimates are based on financial data provided to ICDC by more than 60 financial firms, including JPMorgan Chase, Wells Fargo, U.S. Bank, and The Principal Financial Group.

Collectively, HSA administrators and custodians say they are opening about 50,000 new accounts each month. The average HSA balance grew from $1,181 in January to $1,260 now, the ICDC data show. The higher average balance illustrates that account holders are more likely to use HSAs as savings vehicles than as spending accounts, administrators say.

“Over the past four years, just about every major health insurer has launched some type of account-based consumer-directed health coverage. Over the next couple of years, we’ll see every major financial firm add HSAs to their product portfolios,” says ICDC Managing Editor Steve Davis. Fidelity Investments, Bank of America, and LaSalle Bank are among some of the financial powerhouses that will make HSAs available this fall.

Source: Atlantic Information Services, Inc., www.aishealth.com

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