Banks gearing up for health savings account boon

Financial institutions increasingly are offering HSAs to cash in on a projected $75 billion industry.

By Jonathan G. Bethely — Posted Dec. 4, 2006

Print  |   Email  |   Respond  |   Reprints  |   Like Facebook  |   Share Twitter  |   Tweet Linkedin

Financial institutions are jumping on the health savings account bandwagon in a hurry.

Nearly 1,100 banks now offer a health savings account, more than three times the number at the end of 2005, according to Information Strategies, a Ridgefield, N.J.-based marketing firm targeting small businesses and operator of, an HSA information site.

JoAnn Laing, president and CEO of Information Strategies, said that although larger banking institutions have jumped into the fray, the real growth is happening in smaller banking institutions such as credit unions and regional banks.

"They're starting out small with just a checking account and rapidly building with a credit/debit card or an investment option," Laing said.

The AMA supports HSAs as a way to empower patients to have greater control over their health care decision-making and encourages employers to offer HSAs as one of several insurance options to employees. AMA policy supports innovative approaches to health care coverage, including consumer-driven health plans such as HSAs.

According to America's Health Insurance Plans, more than 3 million Americans have enrolled in HSA policies that combine HSAs with high-deductible insurance plans, triple the number covered in 2005. Employer group coverage is the fastest-growing segment for HSA products, which have grown from 20% of the HSA market in September 2004 to approximately 60% in January, according to AHIP.

Industry experts predicted a growth spurt in the world of HSAs to the tune of nearly $75 billion in tax-free deposits. Chicago-based consultants Diamond Cluster International issued its prediction in a 2005 report that assumes 10% of privately covered lives will be enrolled in HSAs, a total of 15 million to 25 million consumers.

With those kinds of numbers, financial institutions are scrambling to get a piece of the market. Bank of America announced a partnership with Aetna to introduce a new credit card that converts usage points into cash in a member's HSA account. J.P. Morgan Chase will start allowing people to sign up for HSAs online.

South Windsor, Conn.-based Rockville Bank is another bank that jumped head-first into the HSA business in October to capitalize on the tremendous growth potential. "It's a stable source of dollars, and we did have an interest [from customers]," said Richard J. Trachimowicz, senior vice president of retail banking at Rockville.

Back to top



Read story

Confronting bias against obese patients

Medical educators are starting to raise awareness about how weight-related stigma can impair patient-physician communication and the treatment of obesity. Read story

Read story


American Medical News is ceasing publication after 55 years of serving physicians by keeping them informed of their rapidly changing profession. Read story

Read story

Policing medical practice employees after work

Doctors can try to regulate staff actions outside the office, but they must watch what they try to stamp out and how they do it. Read story

Read story

Diabetes prevention: Set on a course for lifestyle change

The YMCA's evidence-based program is helping prediabetic patients eat right, get active and lose weight. Read story

Read story

Medicaid's muddled preventive care picture

The health system reform law promises no-cost coverage of a lengthy list of screenings and other prevention services, but some beneficiaries still might miss out. Read story

Read story

How to get tax breaks for your medical practice

Federal, state and local governments offer doctors incentives because practices are recognized as economic engines. But physicians must know how and where to find them. Read story

Read story

Advance pay ACOs: A down payment on Medicare's future

Accountable care organizations that pay doctors up-front bring practice improvements, but it's unclear yet if program actuaries will see a return on investment. Read story

Read story

Physician liability: Your team, your legal risk

When health care team members drop the ball, it's often doctors who end up in court. How can physicians improve such care and avoid risks? Read story

  • Stay informed
  • Twitter
  • Facebook
  • RSS
  • LinkedIn