The Cost of Your Health

Summary

Podcast Summary: Bloomberg Businessweek – "The Cost of Your Health"

Date: September 9, 2025
Hosts: Carol Massar, Tim Stenovec
Guest: Scott Cutler, President & CEO of HealthEquity

---

Episode Overview

This episode of Bloomberg Businessweek explores the rising costs of health care in the United States and the role of Health Savings Accounts (HSAs) in addressing both employee and employer needs. Scott Cutler, CEO of HealthEquity, joins the hosts to discuss recent company performance, the growing importance of HSAs, impacts of legislative changes, and broader trends underlying health care affordability.

---

Key Discussion Points & Insights

1. HealthEquity’s Business Model & Reach

• Market Presence:

  • HealthEquity administers HSAs, FSAs, and other reimbursement accounts for about a quarter of working Americans ([02:30]).
  • Market cap stands at $8.4 billion.

• How the Company Makes Money:

  • Primarily through fees and services tied to managing these accounts.
  • HSAs are described as the most tax-advantaged savings vehicles available: “You should be contributing at the max…you can have it grow tax free and ultimately you can spend it tax free for healthcare related expenditures.” – Scott Cutler ([02:42]).

2. HSAs vs. FSAs: Key Differences

• HSAs:

  • Not "use it or lose it." Funds roll over and can accumulate.
  • Require a high-deductible health plan (HDHP) ([03:29]).
  • Annual family contribution limit is about $8,500 as of 2025.
  • Both a savings and investment tool for future healthcare needs.

• FSAs:

  • Generally "use it or lose it."
  • More narrowly tied to active employment and immediate spending.

3. Eligibility and Recent Legislative Changes

• Expansion Under Recent Legislation:
  • Eligibility now extends to those enrolled in ACA Marketplace bronze plans ([05:34]).
  • “We’re bringing in the largest expansion of the HSA eligibility in the last 20 years.” – Scott Cutler ([05:34]).
  • Telehealth services are now HSA-eligible under the Trump administration’s changes.

4. Employer and Employee Perspectives

• Employer Side:

  • Employers offer HDHPs with HSAs to manage soaring healthcare costs:
    • “Healthcare costs are growing at three times that of wages.” – Scott Cutler ([04:34]).
  • Some, like HealthEquity itself, offer only high-deductible health plans, then match and contribute to employees’ HSAs.

• Employee Side:

  • Employees must actively choose HDHPs to participate in an HSA.
  • Education gap remains: not all employees understand the benefits or mechanics ([04:14]).

5. Healthcare Affordability Crisis

• Cost Pressures:
  • Health care remains unaffordable for many individuals and even employers ([06:30]).
  • HSAs are positioned as a tool to prepare for current and future healthcare expenses.

6. Insights into the Labor Market

• Connection to Job Market Trends:
  • Early 2025: weaker job market, less churn.
  • Employers and employees both feeling pressures—less hiring, heightened concern about healthcare costs ([06:30]).

7. User Demographics & Use Cases

• Demographics:

  • HSA users are “as broad as the US workforce would be. Old, young, old.” – Scott Cutler ([07:20]).
  • Increasingly integrated with digital apps and wellness behaviors.

• Other Benefits:

  • HealthEquity also administers commuter, dependent care, and lifestyle reimbursement accounts, but the majority of business is in HSAs ([08:23]).

8. Macroeconomic & Regulatory Environment

• Legislation’s Fast Pace and Uncertainty:

  • “The regulatory front creates a lot of uncertainty…You have to decide where you want to take risk, what you can control and manage.” – Scott Cutler ([09:10]).
  • Expiring tax credits in health care are a significant concern for the coming year.

• Lobbying & Policy Advocacy:

  • HealthEquity actively lobbies for broader HSA access and greater healthcare cost affordability ([10:04]):
    • “Our agenda has really been: how do you address the affordability crisis of health care and how do you prepare more Americans for that health care expense?”

---

Notable Quotes & Memorable Moments

“A little known fact about Health Savings Accounts is that they are the most tax advantaged savings vehicle.”
— Scott Cutler ([02:30])

“It's always associated with a [high deductible] plan… only about a third of people, when offered the choice, will select a high deductible health plan. But in reality, [out-of-pocket costs] are typically no more expensive…particularly when you combine it with an HSA.”
— Scott Cutler ([03:29])

“We have a whole new class of Americans now qualified to be able to… enroll in an HSA. We’re bringing in the largest expansion of HSA eligibility in the last 20 years.”
— Scott Cutler ([05:34])

“Healthcare costs are growing at three times that of wages.”
— Scott Cutler ([04:34])

“Health care is unaffordable for many people and companies. We have visibility into both of those trends.”
— Scott Cutler ([06:30])

“The regulatory front creates a lot of uncertainty around what’s going to happen… as a leader, you have to decide where you want to take risk, what you can control and manage.”
— Scott Cutler ([09:10])

“Our agenda has really been: how do you address the affordability crisis of health care and how do you prepare more Americans for that health care expense?”
— Scott Cutler ([10:04])

---

Timestamps for Important Segments

• [02:30] – Scott Cutler explains HealthEquity’s core business and HSA mechanics.
• [03:29] – Breakdown of differences between HSAs and FSAs; prerequisites for HSA participation.
• [05:34] – Legislative changes expanding HSA eligibility.
• [06:09] – Labor market signals from HealthEquity’s customer base.
• [07:20] – Demographics and stories from HSA users.
• [08:23] – Other reimbursement and commuter benefits handled by HealthEquity.
• [09:10] – Macro and regulatory risks, and company reaction.
• [10:04] – HealthEquity’s lobbying agenda and its impact on the US healthcare system.

---

Conclusion

This episode dives into the complexities of health care costs, policy changes, and the importance of HSAs as both a savings vehicle and a tool for financial health. Scott Cutler highlights how both individuals and corporations are grappling with rising expenses, expanding eligibility, and the growing need for education around healthcare planning. HealthEquity’s position at the center of these trends offers a unique insight into the American healthcare economy’s evolving landscape.

Transcript

[Boston Children's Hospital Narrator]

Pinpointing the genetic changes that predispose us to disease, identifying the roots of mental illness, treating congenital anomalies even before birth. At Boston Children's Hospital, we're investing in children's health today to ensure the well being of adults tomorrow. As home to the world's largest pediatric research enterprise and more than 260 specialty programs, Boston Children's is where the world comes for answers.

[PayPal Open Advertiser]

Learn [e-mail] Every business has an ambition. PayPal Open is the platform designed to help you grow into yours with business loans so you can expand and access to hundreds of millions of PayPal customers worldwide. And your customers can pay all the ways they want with PayPal, Venmo pay later and all major cards so you can focus on scaling up when it's time to get growing. There's one platform for all business PayPal open grow today at paypalopen.com loans subject to approval in available locations.

[Carol Massar]

So have you heard the story about the prescription plan? With savings automatically built in, it's where a family of any size can feel confident the cost of their medication won't hold them back. Go to CMK Co Stories to learn how CVS Caremark helps members save just by being members. That's CMK Co s T O R I E S.

[PayPal Open Advertiser]

Bloomberg Audio Studios Podcasts Radio news.

[Carol Massar]

You're listening to Bloomberg businessweek with Carol Massar and Tim Stanvak on Bloomberg Radio.

[Bloomberg Host]

We want to talk a little bit about, as we mentioned, some more voices from the C suite. So let's get to it. Health Equity shares of that company rallying for a second day as analysts raised price targets on the stock following earnings late Tuesday. The company administers health saving accounts and flexible spending accounts. And and it did boost its adjusted profit forecast for the full year. It also reported revenue and adjusted earnings per share for the fiscal second quarter that beat the average analyst estimate. So here to talk about the quarter, the outlook in the business is the company's president CEO. He's Scott Cutler. And the company, if you're not familiar, $8.4 billion market cap. Scott joining us right here in studio and full disclosure, we have health equity cards. FSA is here in Bloomberg. Full disclosure, I gotta tell you, we all take these things for granted. We use them and so on and so forth. Lay out your business though. How do you guys make money on all of this?

[Scott Cutler]

So we cover about a quarter of working Americans today would have an account with us. And I think the little known fact about Health Savings Account is that they are the Most tax advantaged savings vehicle.

[Bloomberg Host]

That you could have is that different from an fsa?

[Scott Cutler]

It is different than an FSA because an FSA is use it or lose it. An HSA is an asset that you should be saving in you, you should be contributing at the max for a family is about $8,500 a year. And then you should be helping that invest and grow over time because you can have it grow tax free and then ultimately you can spend it tax free as well for health care related expenditures. So it's a, it's a, it's a great account to have, but it's also great to be able to connect it to your health care, your wellness. And it's obviously a benefit that's provided.

[Carol Massar]

By employers, but it's not provided by every employer. I got. I've been hearing about health savings account, my entire care. I've never had one. I've never had the opportunity to have one. Is it because I've never had a high deductible health plan?

[Scott Cutler]

It's, it's always associated with a, with a plan. And I'll maybe talk a little bit about how it's expanding now under the, under the new legislation, but it's first initially tied to a high deductible health plan. And the challenge is only about a third of people, when offered the choice, will select a high deductible health plan. The reality is a high deductible health plan, in terms of out overall out of pocket costs is typically no more expensive than a low deductible plan, particularly when you combine it with an hsa. And so you've got to select that.

[Bloomberg Host]

Plan is the tax benefit, you're saying?

[Scott Cutler]

Yeah, that's how it was set up. And so you've got to select that plan and then you can have an HSA that's associated with it. And so we look at adoption of high deductible health plans as one step. And then once you have one, you know you should be contributing and then.

[Carol Massar]

Using that, does it put the onus on the employee to, to make these financial decisions rather than the company in that sense, like you have to actually go out. If you, if you are offered a range of health plans where you work, which oftentimes people are doing, you don't necessarily have the information always to go and make that choice.

[Scott Cutler]

It's, it's two things. One, as an employer, the challenge that you have is how do you manage your health care costs that are growing at three times that of wages? Yeah. And one of Those things is planned construction. So plan construction around how many of your employees do you want and can you encourage to be in a high deductible health plan? Our best in class employers actually only offer a health, high deductible health plan. That's what we do as well. But we also match and we contribute and we tie that to great wellness behaviors. And so from an enterprise, this is a great way to control your healthcare costs for an individual. This is to help you prepare for the healthcare costs that will come to you and in retirement or, you know, or in any health event and you're preparing for that future. So it works both sides.

[Bloomberg Host]

The Trump administration, first term as well as second term, has certainly expanded HSA eligibility for some plans and for telehealth Services. Talked about those changes and what it's meant in terms of the activity you are seeing in the growth.

[Scott Cutler]

We have a whole new class of Americans now following the passage of the bill that now qualify to be able to and are eligible for an hsa. So if you have and signed up part of a ACA Marketplace plan, a bronze plan, you can now enroll in an HSA where before you were not eligible. And so that's true with the new legislation. So we're bringing in the largest expansion of the HSA eligibility in the last 20 years. So we think it's a big opportunity, but it's also an opportunity to educate individuals about why should I have an HSA and what can be used for.

[Carol Massar]

You know, you guys have a really interesting view of the economy because you see directly how many employees are being added to plans. We're getting some light data when it comes to employment in the US we'll get a payrolls report tomorrow that might clear things up. ADP came in a little light today. What can you tell us about what you're seeing from customers right now in terms of labor?

[Scott Cutler]

So when you, when you think about us, yes, we would see, you know, job churn, both hiring as well as people moving as a tailwind for, for our business early in the year we saw it, we said this market feels a little weaker. We were communicating that out to the street early in the year. And then obviously with the BLS revising down the labor statistics over the last couple of quarters, that's been very true. We still see that. And so it's a weaker job market overall, but also I think from employers, it's sort of this other thing which is also health care costs overall are unaffordable for many people and even companies. And so how is it that you deal with, with both and so we have visibility I guess into both of those trends.

[Bloomberg Host]

Who's the typical person who opens up hsa? I'm just curious, is there a specific demographic or.

[Scott Cutler]

No.

[Boston Children's Hospital Narrator]

All over the place.

[Scott Cutler]

No, it's as broad as the US workforce would be. Old, young, old. Yeah. And actually what excited me about joining health equity was, was seeing my son and who entered the workforce, had his firm provided an hsa. How he was using it in a digital app. Think of it as stored value. Using it in, in health care related expenditures, an integrated part of his health decisions. He and his wife and I was like this is a very cool company, great app. And was one of the reasons I joined.

[Carol Massar]

You know, it's interesting. I, as Carol mentioned, we use full disclosure. We use health equity here. And also it's not like we have a choice. I mean this is what we are offered as employees. And I think that's the case for all employers who use employees who use services such as yours. They, they are given this is the option when they sign up or when you start working somewhere. But I use it less for, for health stuff. I use it more for non health stuff like transportation benefits, dependent care, reimbursement, lifestyle stuff that we get. Reimbursement in that sense, is that a tiny part of your business compared to the health care side?

[Scott Cutler]

So we have, we have HSAs and then we have other reimbursement accounts as well as commuter and cobra. So your commuter benefits would be through a different of account. COBRA would be for, you know, unemployment and then you have FSA's lifestyle savings accounts. So all sorts of different accounts. Most of our businesses and HSAs. But as we go to employers, you know, Bloomberg being one, there's a host of products that employers like to offer as part of their benefit plan. And so we offer the host of those CDB products overall.

[Bloomberg Host]

So Scott, when you look at kind of the macro stuff that's going on and coming at us nonstop today, a lot of it coming out of D.C. i mean what's, what's top of mind? Is it just regulatory in terms of changes coming out of Washington that is most important for your world or is it also kind of where the economy is?

[Scott Cutler]

Well, in the health care space this year we have a very active year on the legislative front. Things changing that the one big beautiful bill was one of the fastest pieces of legislation that moved through both, you know and I think as you look at other things, expiring tax credits at the, at the end of the year in health care are pretty significant. There's, you know, potentially big changes that could come if those tax credits do expire. And so, you know, Washington, D.C. the regulatory front creates a lot of uncertainty around what's going to happen around legislative change. And then overall, some of the impact on policies, you know, for a CEO makes you take a step back and say, hey, where do I want to take risk? Where do I see that risk? What can I control and manage? And, you know, I think we see that. I see that as a leader as well.

[Carol Massar]

What do you actively push for in Washington? If you do have lobbyists, what do you want?

[Scott Cutler]

Yeah, I mean, we're actively lobbying in Washington. Our agenda has really been how do you address the affordability crisis of health care and how do you prepare more Americans for that health care expense? We do believe that access to an HSA is one way we want to better connect people to saving and spending to their healthcare. We want employers to think about their role in that. And you know, I think if we're all involved in that aspect and we're connected to the health care decisions, we can drive costs overall of health care in the system down. And it's 20% of US GDP and those and those costs are rising faster. And so I think we all have.

[Bloomberg Host]

An active role to play and not always with great outcomes, certainly here in the United States, despite all that spending. Scott, thank you so much. Really appreciate it.

[Boston Children's Hospital Narrator]

Hiscock Small business insurance knows there is no business like your business. Across America, over 600,000 small businesses, from accountants and architects to photographers and yoga instructors, look to Hiscox Insurance for protection. Find flexible coverage that adapts to the needs of your small business. With a fast, easy online', @hiscox.com that's his cox.com there's no business like small business. Hiscox Small Business Insurance.

[Siemens Advertiser]

These days, AI can help you adopt better time management, but it can't stop colleagues booking meetings during lunch. But how about being able to easily adopt industrial AI to streamline your business? Siemens Xcelerator helps you find the right AI providers and easily understand what they offer so you can use modular solutions to quickly scale up and grow your business. That's AI for real. From the global market leader in industrial AI, Siemens. Learn more on USA.Siemens.com AI@GSK we believe.

[GSK Advertiser]

That to get ahead of disease, you need to understand its root cause. And that's why we combine our deep understanding of immune science with cutting edge technology. It helps us to create targeted therapies that match the right treatment to the right patient, transforming the lives of millions by uniting science, technology and talent. We work tirelessly to get ahead of disease together. Visit gsk.com to discover more.