March 2006

Nearly $1 billion held in HSA accounts

Health savings accounts are catching on with the American public. In just two years, Americans have banked nearly $1 billion in tax-advantaged health savings accounts (HSAs), according to data gathered by Inside Consumer-Directed Care (ICDC) newsletter and reported in its Feb. 24 issue.

The estimates are based on financial data provided by more than 60 financial firms including JPMorgan Chase, Wells Fargo, and The Principal Financial Group.

HSA administrators and custodians have collectively opened more than 820,000 accounts and say they are adding about 60,000 new accounts each month, ICDC found. The average balance is $1,181.

“Now that HSA assets are pushing $1 billion, we’re going to see competition really heat up as more national firms, small community banks and local credit unions enter this space,” says ICDC Managing Editor Steve Davis. “We could even see some large health insurers launch their own financial firms, or acquire existing ones, to capture a bigger slice of this emerging market. Last December, the BlueCross BlueShield Association said it would open its own Blue Healthcare Bank in early 2007.”

Source: Atlantic Information Services

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