J.P. Morgan today announced that its Health Savings Account (HSA) business has grown by 60 percent in account volume over the last year.
As the only national bank to offer HSAs through its own proprietary platform, J.P. Morgan remains an industry leader with more than 300,000 account holders and more than $400 million in assets.
HSAs enable employers and consumers to balance more effectively short- and long-term needs around healthcare expenses, said David Josephs, head of J.P. MorganÂ™s Consumer-Directed Healthcare business. With the rising cost of healthcare coverage, health insurance plans that include an HSA help individuals plan for current and future expenses while helping employers and individuals manage healthcare costs.
J.P. Morgan reports a number of key trends in the market since offering HSAs directly to employers and consumers last year.
Employer commitment key to success
The firm reports seeing a 97 percent adoption rate among eligible employees in HSA programs sold by J.P. Morgan directly to employers. Much of the success of these new plans is attributed to senior level commitment and employee training and education.
Employers that have embraced the HSA as a major part of their healthcare strategy are seeing high levels of adoption, said Josephs. Keys to success are a strong plan design with employer contributions and an aggressive education program.
To assist employers with HSA education, J.P. Morgan has developed a comprehensive adoption kit that includes communication materials needed to educate employees, as well as a road map on how and when to conduct training sessions. The kit also includes an interactive video that educates employees on how the HSA works using real-life examples.
Diversity in employer adoption
J.P. Morgan saw early adoption of its program from medium and small businesses that found the HSA as a way to preserve affordable health coverage. As the HSA is offered along with a high deductible health plan, employers are generally able to offer their employees lower premiums and put employees in control of how their dollars are spent. The additional tax savings of these plans can also make offering the program much less expensive for the employer than traditional insurance coverage.
At the same time, many large organizations have adopted J.P. MorganÂ™s HSA program. These organizations come from industries such as manufacturing, retail and financial services, with participation across all salary levels including low- to-moderate income employees as well as managers and executives. Larger organizations realize they can save up to 30 to 40 percent annually using HSAs.
Benefits of an HSA for consumers and employees
HSAs allow account holders to finance their current medical expenses with pre-tax dollars and accumulate savings in a tax-free cash account. As their balance grows, account holders have the option of opening an investment account and transferring assets into a mix of mutual funds. They also have the flexibility to hold onto their HSA account if they change jobs and can carry over unspent HSA balances from year to year, creating an excellent retirement healthcare savings tool.
J.P. MorganÂ™s HSA program is offered directly to consumers through Chase, the firmÂ™s consumer banking brand. More information on the Chase HSA is available at www.chase.com/hsa.
About J.P. Morgan Healthcare Solutions
J.P. Morgan Healthcare Solutions provides a comprehensive suite of products, services and financial settlement tools for consumers, insurers, physicians, hospitals and other healthcare providers through two core businesses Â“ Consumer-Directed Healthcare and Business-to-Business Solutions. J.P. Morgan Healthcare Solutions is part of the firmÂ™s Treasury Services business. With more than 50,000 clients and a presence in 39 countries, J.P. Morgan Treasury Services (JPM TS) is the worldÂ™s largest provider of treasury management services. JPM TS is a division of JPMorgan Chase Bank, N.A., member FDIC. More information can be found at www.jpmorgan.com/ts.
JPMorgan Chase & Co.
Michael Fusco, 212-270-5089