Wells Fargo: HSA Accounts Hit Record Numbers

By Cyril Tuohy

InsuranceNewsNet

Assets in Wells Fargo’s Health Savings Accounts program grew to more than $809 million in 2012, an increase of 31 percent, the bank reported. The number of HSA accounts grew to a record 365,000 by year end, the bank also reported.

The latest Wells data confirms the growing popularity of HSA plans, which allow contributors to put away pretax funds to pay for health-related expenses.

“Wells Fargo helps business clients meet their objectives by maximizing enrollment in HSA-compatible health plans, which enable them to reduce overall health care expenses,” said Elizabeth Ryan, head of Wells Fargo’s Health Benefit Services, in a statement. “Our business clients appreciate the active role we take in educating their employees.”

Wells Fargo HSA accounts carry an average balance of $2,736, or about 20 percent more than the industry average of $2,283, Ryan also said. Workers saved an estimated $100 million in taxes in 2012 through their Wells Fargo HSAs, Ryan said.

HSA contributions are tax deductible, or can be made pretax through payroll deductions. Earnings and interest accumulate tax-free. Withdrawals are tax-free when used for qualified medical expenses. Unused HSA funds do not expire at year-end and carry forward year after year, helping build tax-free savings that can be used to pay for medical expenses in retirement.

Enrollment in HSA programs has climbed steadily since they were introduced in the mid-2000s.

According to data released last year by America’s Health Insurance Plans, which represents the nation’s health insurance industry, the number of covered lives under HSAs went from about 1 million in 2005 to 13.5 million in January 2012.

HSA programs in all market categories – individuals, small group and large group – have recorded enrollment increases, with the large-group segment growing fastest over the last seven years, according to AHIP.

Wells Fargo is a nationwide, diversified, community-based financial services company with $1.4 trillion in assets. It serves an estimated one in every three households in the nation.

Cyril Tuohy is a writer living in Pennsylvania. He has covered the financial services industry for more than 15 years. He has also written about food, restaurants and travel. He can be reached at Cyril.Tuohy@innfeedback.com.

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Cyril Tuohy is a writer based in Pennsylvania. He has covered the financial services industry for more than 15 years. He can be reached at cyril.tuohy@innfeedback.com.