Health Savings Account Blog

Until now, BCBS insurers have partnered with established banks to handle the savings accounts that members use to pay their out-of-pocket expenses. BCBS executives noted that Blue Healthcare Bank, which currently has the support of 31 of 39 locally operated BCBS companies, could help decrease transaction costs for the HSA health insurance plans. The move follows the creation in November of a jointly branded debit card with Visa for accounts linked to health plans. UnitedHealth Group is the only other major health insurer that has formed its own bank (Wall Street Journal, 12/5). Blue Healthcare Bank will offer debit cards for health care costs and credit lines if enrollees' costs exceed their savings. It will not provide mortgages or other types of commercial lending. Glenn Melnick, health care financing expert with Rand, said that the move is logical, adding, "With the growth of HSAs, there should be $10 [billion] to $20 billion in those accounts by 2010, and the insurers are hoping to hold on to that money. It's a growing market" (Los Angeles Times, 12/5). Serota said, "We're not getting into the banking business per se. This is about the sole function to support health care transactions, a business we know a lot about." However, some analysts said that health insurers lack the "critical mass" and "expertise" to compete with established banks, the Journal reports (Wall Street Journal, 12/5).