Financial advisors can add value to their practices by helping to craft health savings accounts for employers, according to Kevin Robertson, chief revenue officer at HSA Bank, an administrator of HSAs in Milwaukee.
Advisors can prompt employers to consider the right questions before adopting an HSA for the employees, Robertson said today during the Broadridge Fi360 Solutions annual conference.
The first step advisors should take is to encourage employers to define what the company’s goals are in adopting an HSA, which should include helping employees manage health expenses and accelerating employees’ retirement readiness, he said.
By providing employers with useful advice for creating an HSA benefit, advisors can add value to their advice and differentiate the firm from the competition, Robertson said HSAs can be positioned as a retirement benefit and a savings vehicle for employees. Advisors should make sure employers have a multiyear plan for the HSAs.
“The advisor can bring powerful insights to the employer,” Robertson said. “He or she can help the employer optimize the plan.”
Robertson said studies have shown that the vast majority of employees are in the wrong healthcare plan for their situations and that they waste on average $1,000 a year on healthcare.
As HSAs become more popular, options similar to those used to encourage participation in 401(k) plans are being used, such as employer matching funds. Employers can help employees take an active part in their healthcare by requiring them to select options, but if that is done, the employer also needs to provide assistance and education on how to make those decisions, he said.
Poor decision making by employees can affect their economic well-being, he said. There is an overwhelming increase in satisfaction with the plans when employees receive assistance in selecting the right options, he said. Employers also can help employees begin to invest the money that is accumulated in HSA accounts.
“Retirement advisors have a unique opportunity to offer additional services as more plan sponsors position HSAs as a retirement benefit,” the consultant said. “The advisor can design an HSA plan that saves the employer and employee money and still provides a superior plan. Doing so will drive a higher perception of the advisor’s value.”
“There has been a hesitancy on some people’s parts to join an HSA, but the financial advisors can help eliminate that” through education, Robertson said.