Nationwide today announced that it will have its new health savings account (HSA) program open for business in the first quarter of 2019.
The company also announced that it has picked HealthEquity Inc. to administer the HSAs.
Nationwide executives are hoping the program will give financial professionals something interesting, and important, to talk about with clients.
Nationwide’s move into the HSA market could also add marketing energy to the $54 billion HSA market.
What is Nationwide?
Nationwide is a Columbus, Ohio-based mutual insurer.
A mutual insurer is owned by the policyholders, not by public investors.
Nationwide reported $562 million in net operating income for 2017 on $28 billion in operating revenue and $236 billion in assets, according to the company’s annual report.
The company is an advertising powerhouse: It has turned the “Nationwide is on your side” jingle into a song that most Americans recognize, even in an age of cord cutting.
What is HealthEquity?
HealthEquity is an HSA administrator based in Draper, Utah.
The company serves as the custodian for 14% of HSA assets, according to a recent company presentation slidedeck.
HealthEquity already has HSA administration relationships with Anthem Inc., the Health Plan Alliance and the Blue Cross Blue Shield Association.
What is an HSA?
The HSA program gives individuals with HSA-compatible coverage a chance to deduct HSA contributions from federal taxable income, and to accumulate interest, dividends and capital gains on the assets from federal income taxes.
Consumers can spend the HSA cash on qualified expenses without paying taxes on the withdrawals.
How does the HSA market look?
A few years ago, some market observers were predicting that Affordable Care Act programs and rules, and regulator hostility in Washington, could smother HSAs and other personal health accounts.