Health savings account provider HealthSavings Administrators is integrating with Orion Advisor Services (soon to be called Orion Advisor Tech as part of the company’s rebranding), according to an announcement. The move is intended to help registered investment advisors more easily integrate HSAs into retirement planning services.
Data aggregators like Plaid already pull account information from HSAs, but the integration will facilitate RIAs' management of clients’ HSAs alongside other investment accounts, according to the announcement. The integration also includes a data feed to provide account information into the Orion portfolio interface.
“We are committed to empowering advisors to build and manage customized dashboards that ease their back-office burden,” said Jeff Kliewer, director of integration partnerships and support at Orion. By eliminating the back-and-forth of moving between account interfaces, advisors will be able to focus on financial and retirement planning, he added.
Orion currently works with "around 150 firms" that aggregate HSAs, said Eddie Sempek, chief innovation officer at Orion Advisor Services, a number that represented a "critical mass" and signaled a high likelihood of greater demand, catalyzing the integration.
Just two years ago, however, a Morningstar study cast doubt on the spending and investing features available to HSA users. Due to their newness (HSAs were first created in 2003), advisors and investors are also uncertain how exactly they should be treating the funds they add to their accounts—whether spending the balances or investing them.
While advisors using Orion are demanding the integration, data from HealthSavings Administrators is less conclusive about the overall demand for HSA guidance from advisors.
“Unfortunately we do not have concrete numbers on how many advisors across the country use HSAs,” said a spokesperson for HealthSavings Administrators.
A survey of 233 advisors, conducted by the firm earlier this year, found that 36% of advisors “do not fully understand how an HSA works” and 40% of advisors said their clients “don’t fully understand HSAs.” Despite those figures, the firm maintained that “health savings accounts are increasingly becoming part of an overall financial wellness and retirement plan.”
The conclusion was echoed by Orion. "HSAs have emerged over the past few years as a key part of retirement planning, so while we have several firms aggregating these accounts today, we are confident an integration like this will open the door to many more advisors following suit," said Sempek.