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Speaker 1: You're listening to Taking Stock with Kathleen Hayes and Pim

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Speaker 1: Fox on Bloomberg Radio. Health savings accounts, What are they,

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Speaker 1: who is using them? And what do they mean in

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Speaker 1: the context of financial services broadly. We're very happy to

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Speaker 1: welcome to the show now Begonia Club. She's the CEO

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Speaker 1: of umb Healthcare Services based in Kansas City, Missouri. She

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Speaker 1: was recently named one of the twenty five women to

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Speaker 1: Watch in Banking from American Banker and boy, they k

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Speaker 1: know who to watch in banking. She's joining us in

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Speaker 1: our New York studio today. Welcome, thank you for having me. So.

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Speaker 1: First of all, health savings accounts. What are they again

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Speaker 1: for our listeners to be perhaps don't have one? And

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Speaker 1: how broadly are they being used? Now? Health savings accounts

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Speaker 1: or h says are tax advantage accounts and they actually

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Speaker 1: um sorry, so there are tax advantaged accounts and they

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Speaker 1: are coupled with high deductible health plans. So if you

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Speaker 1: have a high deductible health plans, you can contribute to

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Speaker 1: an h s A up to the amount of six thousand,

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Speaker 1: six hundred and fifty dollars if you have a family

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Speaker 1: plan or three thousand, four hundred dollars if you have

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Speaker 1: an individual plan. And what is unique about the hcs

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Speaker 1: is that they are individually owned accounts. They are not

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Speaker 1: employer funds, so they roll from year to year, so

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Speaker 1: any funds that you have left there remain with you

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Speaker 1: and stay with you forever. That's why the investment portion

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Speaker 1: of this HSS is so important, and it's got to

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Speaker 1: almost a triple tax three benefit, right because the money

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Speaker 1: that you put into the hs A that comes out

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Speaker 1: of let's say your pay your paycheck before you pay taxes,

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Speaker 1: it grows. If you're lucky enough and you select the

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Speaker 1: right investment, it grows tax free. And when you take

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Speaker 1: it out after age sixty five, that's also a tax

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Speaker 1: free distribution, correct if you use it for eligible made

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Speaker 1: coal expenses. And also something that maybe many people don't

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Speaker 1: realize is that if you make your contributions through your

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Speaker 1: employer payroll, then you don't pay five at taxes, which

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Speaker 1: is seven point sixty So that's also an additional um

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Speaker 1: you know, attractiveness absolutely for these accounts. Now, how do

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Speaker 1: they fit in with the Affordable Care Act and the

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Speaker 1: exchanges all? Well, the exchanges have a variety of plants

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Speaker 1: that people can choose from. There's like the metal levels, gold, silver, bronze. Uh,

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Speaker 1: the agency's are available for certain bronze level plans and

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Speaker 1: in general, I think that there's this trend for engaging

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Speaker 1: more the consumer in their healthcare decisions and their health

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Speaker 1: care expenses that has proven to be very effective for

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Speaker 1: cutting healthcare costs in the country. And that's where really

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Speaker 1: h says high deductible health plants and agency is play

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Speaker 1: a very important all Now. As I mentioned, the hs

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Speaker 1: A is those accounts they can invest in things like

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Speaker 1: mutual funds, stocks, other investment tools in order to generate

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Speaker 1: more money. At UMB tell us about the connection between

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Speaker 1: figuring out what to invest in and the accounts that

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Speaker 1: people may have and don't know what to do. Well,

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Speaker 1: A dumb and many other agency providers will have an

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Speaker 1: investment option for your agency dollars and usually people will

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Speaker 1: keep some cash portion liquid portion in their cash account

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Speaker 1: so to speaks, to cover the current health care expenses

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Speaker 1: and then the remaining that they don't expend expect to

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Speaker 1: spend in the current year they can invest and you know,

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Speaker 1: different providers might have different options. We launched last year

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Speaker 1: h A Saver du n B and this is very

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Speaker 1: used to friendly UH investment platform that has was designed

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Speaker 1: actually with the duo L ruling in mind because of

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Speaker 1: the time the Department of Labor Finish Department of Labor

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Speaker 1: Finisher ruling in mind, since you know, we had the

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Speaker 1: ruling out there for for a while, we put in

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Speaker 1: place something that is again very use or friendly and

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Speaker 1: UM designed with the du L ruling in mind. So

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Speaker 1: very low fees, very transparent fees, no hidden revenue shares

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Speaker 1: or twelve B one fees UH. And we have a

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Speaker 1: set of thirty three funds that have been vetted and

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Speaker 1: selected by our trust department. These are low cost and

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Speaker 1: low risk obviously mutual funds. And you don't have to

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Speaker 1: take a distribution either, right, I mean, unlike an IRA

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Speaker 1: or form you have to take it takes something at

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Speaker 1: the age seventy and a half. But with the hs

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Speaker 1: A you don't have to take any minimum distribution you can.

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Speaker 1: So maybe it's even better than investing in your four

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Speaker 1: one K or I or I don't know, and there

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Speaker 1: are cases where that might be the case. So depending

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Speaker 1: on your on your tax bracket and how much maybe

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Speaker 1: your employers contributing to your agency, it might be better

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Speaker 1: to contribute to your agency before contributing to your for

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Speaker 1: one K. So how important is this? You are one

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Speaker 1: of the top custodians H studies in the country at

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Speaker 1: UMB Healthcare Services. How important it is it overall to

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Speaker 1: the profit picture, the top line, the bottom line for UMB,

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Speaker 1: it is approximately ten approximately ten percent of um B

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Speaker 1: S revenue m bottom line. So so it's a big deal.

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Speaker 1: Well yeah, currently, just just a quickly just say currently

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Speaker 1: for a family plan sixteen, if you've got out of

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Speaker 1: pocket maximum is thirteen thousand, one hundred dollars minimum deductible hundred.

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Speaker 1: That means you could have a hs A and for

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Speaker 1: a single person, uh sixty dollars is a pocket maximum

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Speaker 1: and a minimum deductible. Okay, thanks very much for joining

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Speaker 1: us and illuminating this topic. But going to clumb is

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Speaker 1: the chief executive of u MB Healthcare Services. They're based

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Speaker 1: in Kansas City, Missouri. This is taking Stock. I'm pim

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Speaker 1: Fox my coast. Kathleen Hayes, this is Bloomberg