Health Savings Accounts Build More Than Just Deposits
Health Savings Accounts Build More Than Just Deposits
June 20, 2005
Health Savings Accounts Build More Than Just DepositsBROOKFIELD, Wis.--June 20, 2005--Health savings accounts (HSAs), established through the Premier core banking system from Information Technology, Inc. (ITI), a unit of Fiserv Inc. (Nasdaq: FISV), are driving more new business to America's financial institutions. Those institutions are discovering additional benefits, such as lower costs, cross-selling opportunities and enhanced processing efficiency.
"We don't have to pay additional fees to a third party, such as an insurer or Web-based HSA administrator, to provide the accounts," said Fran Branan, assistant vice president at $471-million Security National Bank in Omaha, Neb. "Integrating HSA processing into Premier is much more efficient, and we're better able to track customer profitability." Branan said her bank has established 410 HSAs since the bank began offering them last spring.
"Premier automates the entire process, including the tax and exception reporting," said Jim Sizemore, ITI senior vice president and CIO. "Our system makes it easy for financial institutions to provide their customers with this valuable deposit gathering product."
ITI's HSA program is part of a larger healthcare banking initiative unveiled by Fiserv this month designed to help banks and credit unions take advantage of the next wave in healthcare cost management. The accounts, owned and managed by consumers and domiciled in financial institutions nationwide, are being seen as the most effective way to keep healthcare cost increases under control while still providing care access to a growing number of consumers.
Authorized by the Medicare Prescription Drug Improvement and Modernization Act of 2003, HSAs allow bank customers with high-deductible health insurance plans to set up tax-free savings accounts to help cover future medical costs. The accounts earn tax-free interest, and can be used to pay healthcare expenses.
"We were the first to offer HSAs in our area, thanks in part to the ease of setting up the accounts in Premier," said Sally Minihan-Ayers, vice president of human resources at $372-million Hilltop National Bank in Casper, Wyo. "Since we made them available to our customers late last year, we've established 464 HSAs and expect to administer several hundred more in the coming months."
While some accounts have been set up for individuals, both banks say HSAs are especially popular with small businesses. "Employers are searching for answers to rising medical costs and HSAs appear to be a solution," said Minihan-Ayers. Employees can contribute pretax dollars to the account, as can employers. The idea is to use the money to pay medical costs that fall under the high deductible, and anything left over at the end of the year can be rolled over.
"These accounts have given us the opportunity to expand our customer base and increase our overall deposit portfolio," said Branan. "We're also able to cross-sell other products and services."
Minihan-Ayers concluded that HSAs processed through their Premier core system have not only provided another source of revenue, "but also a way for our bank to demonstrate leadership in innovation and technology."
Information Technology, Inc. (ITI) provides America's bankers an extensive array of technology solutions and support services for core accounting, relationship management, teller and platform automation, Internet banking, account aggregation, e-commerce solutions for business and consumers, business intelligence, imaging and document management. A comprehensive suite of planning, installation, support, training, analysis and consulting services supports all technology solutions. Founded in 1976 and headquartered in Lincoln, Neb., Information Technology has grown to include its subsidiaries Precision Computer Systems (PCS) and eSolutions, as well as partnerships with some of the best-known technology companies in the world. ITI can also be found on the Internet at www.itiwnet.com.
ITI is a subsidiary of Fiserv, Inc. (NASDAQ: FISV), a provider of information management systems and services to the financial and health benefits industries, including transaction processing, outsourcing, business process outsourcing and software and systems solutions. The company serves more than 16,000 clients worldwide, including banks, credit unions, financial planners/investment advisers, insurance companies and agents, self-insured employers, lenders and savings institutions. Headquartered in Brookfield, Wis., Fiserv reported $3.4 billion in processing and services revenues for 2004. Fiserv was ranked the largest provider of information technology services to the U.S. financial services industry in the 2004 FinTech 100 survey by the American Banker newspaper and the Financial Insights research firm. Fiserv can be found on the Internet at www.fiserv.com.
"We don't have to pay additional fees to a third party, such as an insurer or Web-based HSA administrator, to provide the accounts," said Fran Branan, assistant vice president at $471-million Security National Bank in Omaha, Neb. "Integrating HSA processing into Premier is much more efficient, and we're better able to track customer profitability." Branan said her bank has established 410 HSAs since the bank began offering them last spring.
"Premier automates the entire process, including the tax and exception reporting," said Jim Sizemore, ITI senior vice president and CIO. "Our system makes it easy for financial institutions to provide their customers with this valuable deposit gathering product."
ITI's HSA program is part of a larger healthcare banking initiative unveiled by Fiserv this month designed to help banks and credit unions take advantage of the next wave in healthcare cost management. The accounts, owned and managed by consumers and domiciled in financial institutions nationwide, are being seen as the most effective way to keep healthcare cost increases under control while still providing care access to a growing number of consumers.
Authorized by the Medicare Prescription Drug Improvement and Modernization Act of 2003, HSAs allow bank customers with high-deductible health insurance plans to set up tax-free savings accounts to help cover future medical costs. The accounts earn tax-free interest, and can be used to pay healthcare expenses.
"We were the first to offer HSAs in our area, thanks in part to the ease of setting up the accounts in Premier," said Sally Minihan-Ayers, vice president of human resources at $372-million Hilltop National Bank in Casper, Wyo. "Since we made them available to our customers late last year, we've established 464 HSAs and expect to administer several hundred more in the coming months."
While some accounts have been set up for individuals, both banks say HSAs are especially popular with small businesses. "Employers are searching for answers to rising medical costs and HSAs appear to be a solution," said Minihan-Ayers. Employees can contribute pretax dollars to the account, as can employers. The idea is to use the money to pay medical costs that fall under the high deductible, and anything left over at the end of the year can be rolled over.
"These accounts have given us the opportunity to expand our customer base and increase our overall deposit portfolio," said Branan. "We're also able to cross-sell other products and services."
Minihan-Ayers concluded that HSAs processed through their Premier core system have not only provided another source of revenue, "but also a way for our bank to demonstrate leadership in innovation and technology."
Information Technology, Inc. (ITI) provides America's bankers an extensive array of technology solutions and support services for core accounting, relationship management, teller and platform automation, Internet banking, account aggregation, e-commerce solutions for business and consumers, business intelligence, imaging and document management. A comprehensive suite of planning, installation, support, training, analysis and consulting services supports all technology solutions. Founded in 1976 and headquartered in Lincoln, Neb., Information Technology has grown to include its subsidiaries Precision Computer Systems (PCS) and eSolutions, as well as partnerships with some of the best-known technology companies in the world. ITI can also be found on the Internet at www.itiwnet.com.
ITI is a subsidiary of Fiserv, Inc. (NASDAQ: FISV), a provider of information management systems and services to the financial and health benefits industries, including transaction processing, outsourcing, business process outsourcing and software and systems solutions. The company serves more than 16,000 clients worldwide, including banks, credit unions, financial planners/investment advisers, insurance companies and agents, self-insured employers, lenders and savings institutions. Headquartered in Brookfield, Wis., Fiserv reported $3.4 billion in processing and services revenues for 2004. Fiserv was ranked the largest provider of information technology services to the U.S. financial services industry in the 2004 FinTech 100 survey by the American Banker newspaper and the Financial Insights research firm. Fiserv can be found on the Internet at www.fiserv.com.