Each month Devenir highlights a selection of articles to keep you abreast of the latest trends and developments in the HSA marketplace.
A summary of the articles included in the May 2019 edition:
- HealthEquity Confirms Proposal to Acquire WageWorks for $50.50 per Share in Cash
- HSA Ownership Boosts Confidence About Retirement Expenses
- Communicating the Difference Between FSAs and HSAs to Participants
- Fintech’s Next Frontier: The $60 Billion Opportunity To Change Millennials And Their Healthcare
- Health Care Price Check: a Couple Retiring Today Needs $285,000 as Medical Expenses in Retirement Remain Relatively Steady
- Sponsors See HSAs as Great Thing for Retirement Savings
HealthEquity Confirms Proposal to Acquire WageWorks for $50.50 per Share in Cash
HealthEquity confirmed that it has made a proposal to acquire all of the outstanding shares of WageWorks for $50.50 per share in cash. The proposal was submitted to WageWorks on April 11, 2019. HealthEquity’s President and CEO, Jon Kessler, commented on the proposal to WageWorks, “Together, we believe we can create exceptional value helping American families connect health and wealth. We look forward to engaging with WageWorks management and board as quickly as possible.”
HSA Ownership Boosts Confidence About Retirement Expenses
Asked what their top retirement concern is, 36% of adults over the age of 65 say it is health issues, according to Franklin Templeton’s eighth annual Retirement Income Strategies and Expectations survey. That is followed by running out of money (16%) and maintaining their lifestyle (12%). Among those of all ages, 51% of respondents say it is paying for health care, followed by paying off debt (16%) and maintaining their lifestyle (15%). However, 75% of those who have a health savings account (HSA) say they know how they will pay for medical expenses in retirement, whereas only 36% of those who do not have an HSA say the same.
Communicating the Difference Between FSAs and HSAs to Participants
In order to accurately communicate about medical flexible spending accounts (FSAs) and health savings accounts (HSAs) to participants, employers must understand the basics of each. While there are similarities between the two-both allow employees to contribute up to a certain amount to pay for out-of-pocket health care costs and in both, contributions are pre-tax and distributions are tax-free-there are some important differences, Sara Caddy, benefits manager at Dimensional Fund Advisors, told attendees of a webinar sponsored by the Plan Sponsor Council of America (PSCA).
Fintech’s Next Frontier: The $60 Billion Opportunity To Change Millennials And Their Healthcare
Forbes takes a look at Alex Cyriac and Shobin Uralil’s path to launching Lively, a VC-backed startup that aims to offer health savings accounts that meet Millennials’ expectations for financial products: low (or at least transparent) fees and easy to manage online.
Health Care Price Check: a Couple Retiring Today Needs $285,000 as Medical Expenses in Retirement Remain Relatively Steady
Fidelity Investments announced its annual Retiree Health Care Cost Estimate. According to Fidelity, a 65-year old couple retiring in 2019 can expect to spend $285,0001 in health care and medical expenses throughout retirement, compared with $280,000 in 2018. For single retirees, the health care cost estimate is $150,000 for women and $135,000 for men.
Sponsors See HSAs as Great Thing for Retirement Savings
The popularity of health savings accounts may be on the verge of surging higher as more companies encourage employees to use the accounts not only as piggy banks for immediate health expenses but also as long-term investments to be tapped only in retirement. If the trend accelerates, so too will the growth of HSAs, industry observers say.