Friday, March 10, 2006

One Beellion Dollars!

Well, whaddaya know: according to a recent study, over the past three years, folks with HSA's have deposited almost $1 billion in their accounts.
Over 800,000 such accounts have been opened, with about 60 new accounts being added each month. Even more interesting: the average account balance is almost $1,200.
Now, naysayers will no doubt adopt the "glass is half empty" interpretation. But that would be misleading:
The typical "generic" copay plan has a $500 deductible, and another $1,000 of co-insurance (i.e. $1,500 out-of-pocket maximum), plus a higher premium. If we assume that most HDHP's use the $1,200 single (or $2,500 family), zero dollar coinsurance configuration, that means that the HDHP has already saved these consumers money.
How's that, you ask?
Pretty simple, really:
■ Singles would have a $1,200 out-of-pocket max, which the HSA now covers in full.
■ Families would have a $2,400 max, which is effectively reduced to $1,200, or $300 less than the co-pay plan.
But it gets better: we're starting to see heavier competition for HSA deposits among banks, credit unions and other financial organizations as these balances continue to grow. The study projects that the number of HSA administrators or custodians could grow from 300 to 400 by year's end.
Not too shabby.
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