5 Questions You Need to Ask When Seeking an HSA Administrator
February 12, 2020
Familiarity matters when it comes to healthcare. As a recent WEX report noted, more than three-quarters of employees spend less than an hour evaluating their healthcare options during open enrollment. And one of the employees surveyed in the report said that many people simply go with the same plan “they signed up for last year.” Why? One reason is because it’s familiar to them.
Employers may find themselves in the same position. Do you stay with your current administrator because it’s familiar to you, or do you change administrators when you’ve found one that offers the technology and service you need so you can reach your company’s goals? We’ve compiled five questions you should ask when choosing a Health Savings Account (HSA) administrator.
Is your HSA FDIC-insured?
The FDIC (Federal Deposit Insurance Corporation) protects your employees against the loss of their “insured deposits if an FDIC-insured bank or savings association fails.” By choosing an FDIC-insured HSA, you’re protecting your employees’ HSA assets in the event that your administrator fails in some way.
Please note: Investments made within an HSA are not FDIC-insured.
Are participants protected from hidden fees?
Your employees depend on you to choose an HSA administrator with low fees. And, just as important, they want protection from hidden fees, which may include fees for account maintenance, investing or minimum balance.
Do they have intuitive and user-friendly technology?
Those enrolled in High-Deductible Health Plans (HDHPs) and HSAs are more engaged with their healthcare, which means they might pair their HSA with Commuter Benefits or HSA-eligible Flexible Spending Accounts as additional ways to save money. Administrators who have technology that simplifies the ability of your employees to track spending, file claims or save money across accounts helps you and them save money. That includes offering one benefits debit card, one mobile app and one online account for all of your benefits.
User-friendly and intuitive technology doesn’t stop with your employees. You should seek an administrator that offers you one online account to manage your benefits, run reporting and interact with customer support teams.
Can we and/or our participants customize HSA investment options?
For healthcare costs alone, a healthy 65-year-old couple retiring this year should expect to need nearly $400,000. To counter these rising retirement costs, HSAs have emerged because of their tax benefits, all funds carry over from year to year, and funds can be invested for potentially faster growth.
Most HSA participants also contribute to a 401(k). By aligning your HSA fund lineup with your 401(k) and offering an HSA with a brokerage account, your employees will have more investment options and can more easily cultivate an investment and retirement-planning strategy that includes their HSAs.
How easy is it to move HSAs to you from a previous custodian?
Changing HSA administrators is a big decision. And, while these decisions often take place at the end of a plan year, you may decide to make a change in mid-year. When picking a new administrator, it’s important to select one that is experienced and has developed packages and programs designed to help employers and consultants with administrator changes.
Would you like to learn more about the value of having one administrator for all of your employee benefits? Complete the form below to download your free handout!
Please note: Discovery Benefits cannot provide investment advice and encourages its participants to seek guidance from a financial adviser for help with investment decisions.