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August 2005
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HSA Market News August 2005; Volume 2, Issue 7
SPECIAL REPORT: At WRG HSA Conference...Banta, BCBS-MA, Cigna, Guardian, Harvard Pilgrim, Intel, Medtronic, Vested Health, Wendy’s...ERISA, other HSA nightmares...HIP to acquire Perfect Health...HSA plan rates fall, study says...HSA deductible floor to rise...Horizon BCBS enhances HSAs...Cigna acquires MCC-NV...Aetna has 50,000 HSA lives...Bank of America offers HSAs...Synovus adds Fidelity funds...Matavante buys Med-i-Bank...Definity lands Edison...
Treasury comparability proposals...IA employers save with CDHPs...IN employers open to CDHPs...and more...
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HIP TO ACQUIRE PERFECT HEALTH
HIP Health Plan of New York has agreed to acquire Perfect Health Insurance Co. (Staten Island, NY), a provider of HSA-compatible high-deductible health plans, according to John Mills, director of product development for HIP.
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HSA PLAN RATES FALL 14%, STUDY SHOWS
A report from online insurance broker eHealthInsurance (Mountain View, CA) shows that through the first six months of 2005, the average monthly premium for HSA-compatible high-deductible health plans dropped 14% to $176.87.
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HSA DEDUCTIBLE FLOOR LIKELY TO RISE 5%
The minimum deductibles for HSA-compatible high-deductible health plans will likely rise 5% to $1050 single, $2100 family in 2006, according to Thomas Reeder, associate benefits tax counsel, office of tax policy, U.S. Dept. of Treasury, up from $1000 single, $2000 family in 2005.
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AT WRG HSA CONFERENCE: PROGRESS COMES SLOWLY
Results—as measured in HSA and HRA membership—continue to be spotty, but health plans and employers continue to gain valuable experience and make headway in their efforts to cut costs through the introduction of consumer-directed healthcare, according to presentations at the World Research Group HSA conference in Chicago this month.
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ERISA, COMPARABILITY, AND OTHER HSA HEADACHES
The first big headache for employers implementing HSA is avoiding ERISA applicability, according to Ashley Gillihan, benefits attorney, Alston & Bird, who discussed the potential legal and regulatory pitfalls of consumer-directed healthcare at the World Research Group HSA conference in Chicago this month.
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TREASURY ISSUES COMPARABILITY RULE PROPOSALS
The Treasury Dept. proposed several clarifications to the HSA comparability rule, including one that would make comparability apply separately to fulltime, part-time and former employees (except those under COBRA).
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IOWA EMPLOYERS SAVE WITH CDHPs
The Health Policy Corp. of Iowa (Des Moines) reported that employers that offer consumer-directed health plans are experiencing cost increases of 5% to 7% in 2005, compared to as high as 10% for employers that are sticking with traditional plans, said Paul Pietzsch, president.
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INDIANA EMPLOYERS OPEN TO CDHPs, SURVEY SAYS
More than half the employers that make up the Tri-State Business Group on Health (Evansville, IN) said they would consider consumer-directed health plans in the future, but only 11% are currently offering or introducing them, according to a survey.
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DEFINITY LANDS EDISON INTERNATIONAL
Edison International (Rosemead, CA) will offer its 13,500 covered employees the option of enrolling in an HRA-compatible consumer-directed health plan from Definity Health (St. Louis Park, MN), a division of UnitedHealth Group.
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HORIZON BCBS PARTNERS TO ENCHANCE HSA, HRA PLANS
Horizon Blue Cross Blue Shield of New Jersey (Newark, NJ) announced that it has enhanced its existing HSA and HRA health plans offerings through partnerships with several leading financial services and technology vendors.
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CIGNA SAYS MCC-NV ACQUISITION WILL BOOST HSAs, HRAs
Cigna Corp. (Philadelphia), which has announced a definitive agreement to acquire Managed Care Consultants Inc. (Henderson, NV), said it hopes the deal will help it expand availability of HSA and HRA products to MCC’s existing client base.
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AETNA HAS 370,000 HRA, 50,000 HSA LIVES
Aetna Inc. (Harford, CT) announced that it had 370,000 HRA lives as of June 30 through the company’s HealthFund consumer-directed health plan, up from 197,000 a year earlier. According to a spokesman, the company had an additional 50,000 HSA lives also through HealthFund.
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BANK OF AMERICA TO OFFER HSAs
Bank of America (Charlotte, NC), one of the nation’s largest financial institutions, announced that it would offer HSA custodial and administrative services through health plans and employers in time for the fall 2005 open enrollment season.
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SYNOVUS ADDS FIDELITY MUTUAL FUNDS TO HSAs
Synovus (Columbus, GA) announced that it would offer health savings account holders the option of investing their HSA funds in seven mutual funds from Fidelity Investments, ranging from conservative money market funds to aggressive stock funds. Synouvs banks began offering HSAs last fall.
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METAVANTE COMPLETES ACQUISITION OF MED-i-BANK
Marshall & Ilsley’s Metavante Corp. (Milwaukee) has completed the acquisition of Med-i-Bank (Waltham, MA) for $138 million in stock and $7 million in cash, dramatically expanding its presence in the healthcare debit card business (HMN, May).
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