SOURCE: Information Strategies, Inc.

March 26, 2007 11:47 ET

HSAs Will Grow Significantly in 2007 Despite Congressional Doubts

RIDGEFIELD, NJ -- (MARKET WIRE) -- March 26, 2007 -- Amid growing Congressional pressure to make some changes in the Health Savings Account (HSA) regulations, a new forecast on their expanding usage and popularity may give some political leaders pause.

Information Strategies, Inc. (ISI) has issued a new estimate on year-end and future growth based on interviews with HSA, CDH and more traditional plan users as well as corporate and custodial managers.

"Many people are just now learning about the changes effected in the closing days of the last congress and they are taking advantage of the new higher savings limits and the greater flexibility in rules," said JoAnn M. Laing, ISI's President & CEO.

ISI expects these changes, which some in Congress indicate they would like modified, to drive the popularity of HSAs even higher.

Speaking at a Washington, DC meeting of industry leaders, Laing provided the following estimates of sector metrics at the end of 2007:

--  The number of Health Savings Accounts will reach 8 million.
--  Deposits in custodial accounts will total $13.6 billion at year-end.
--  Average accounts will pass $1,700 mark, with those accounts being in
    existence two or more years hovering at $4,400.
--  22% of employers will offer HSAs.
--  More than 40% of all companies will fund 50% or more of the first
    year's deductible.
--  New HSA-covered lives will exceed eight million, bringing the HSA-
    insured total to 18 million.
--  Number of institutions offering HSA custodial accounts will pass
--  Investment options for custodial accounts will become more numerous
    and diverse with major giants such as Fidelity taking a leading role.
--  Online portals and other integrated offerings will surge in the fourth
Laing said her company this year had surveyed more than 400 custodial institutions, 2,300 companies as well as 2,000 Americans about their HSA plans. In the past 30 months, the company has interviewed or survey almost 20,000 Americans.

"What we are seeing is a growing desire by respondents to take more control of their healthcare and retirement efforts," she added.

"Clearly HSAs, along with Health Reimbursement Accounts (HRAs) and Flexible Spending Accounts (FSAs) are gaining popularity both with individuals and employers of all sizes," Laing said.

"HSAs are popular with individuals and smaller company managers as a healthcare insurance alternative and even the larger firms such as Deere are jumping in with plans that require more effort on the part of employees but give them some part of their insurance premiums back in the form of savings," Laing said.

About Information Strategies, Inc.

Information Strategies, Inc. (ISI) is a media and marketing company serving large corporations as an advisor and marketing channel and small and medium size businesses as a management information source. It is also the parent of, the Internet's only independent source of data on HSAs and consumer directed healthcare issues.

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