Lively co-founder Shobin Uralil likes to explain the health savings account as the “401(k) for healthcare” — however that it’s woefully underused as an investment car like a 401(okay).
So as an alternative of simply depending on it as a option to pay for healthcare, Uralil and his co-founder Alex Cyriac got down to construct some way not to handiest lend a hand other folks get started up health savings accounts, but additionally lend a hand them imagine them in the similar vein as different sorts of investments. Today, Lively mentioned it is including investment capabilities with an integration with TD Ameritrade, which shall be to be had to all Lively HSA holders. The hope is that Lively will introduce a type of investment that’s been to be had to the normal finance neighborhood, however in a extra seamless manner with the intention to proceed rising right into a one-stop store for HSA.
“The beauty of the HSA, with an HSA you can access the money at any time if you’re using it for qualified medical expenses,” Uralil mentioned. “The 401(k), if you access your money before retirement, you get dinged. If you think about it, I would argue that if you are eligible to open an HSA you would want to max out your contribution before your 401k. It grows through investments tax-free just like a 401(k), but unlike that, you can access your HSA money at any time.”
To get all this executed, Lively additionally mentioned it has raised $four.2 million in financing from buyers that come with Transmedia Capital, Streamlined Ventures, Y Combinator, SV Angel, Kevin Durant and Rich Kleinman’s The Durant Company and a laundry listing of others. (We’ll come with mentioned laundry listing on the backside of the publish.)
“More and more people just can’t afford your traditional low-deductible HMO and PPO plans,” co-founder Shobin Uralil mentioned. “As that happens, the increase and the rise in popularity of the HSA has also seen that trend. We talked to people and they kept saying, I feel like I’m getting nickel-and-dimed, I can’t get my money out when I need it most. [They would say] nobody seems to want to help me save for the future. That, coupled with our personal experiences, made us decide.”
Lively goals to provide customers the facility to open up a health savings account with a top deductible health plan, and make it more uncomplicated to get that cash out and in of the account to pay for deductibles. Lively boils down to 2 merchandise: a device for employers to provide their workers health savings accounts and set up contributions and payroll; and an account for end-users that’s loose to arrange and get an HSA up and working. The maximum essential a part of the latter part, although, used to be making sure that it used to be simple to get cash out to pay for health care with none bother, Cyriac mentioned.
The maximum essential a part of the latter part, although, used to be making sure that it used to be simple to get cash out to pay for health care with none bother, Cyriac mentioned. The corporate gives a Lively-issued debit card — one thing now not new to the marketplace, he mentioned — but additionally seems to make sure that customers see refunds once they pay with out the usage of an particular approach required by means of a financial institution and even Lively. The purpose is to lend a hand folks really feel like they’re the account holder, and now not their employer, even though they finally end up leaving their jobs or switching to new ones.
There also are some competition within the space, such as HealthEquity, and different merchandise owned by means of health insurers like United Healthcare. As health insurance coverage prices turn into an more and more large query going ahead, optimizing a health savings account goes to be a large center of attention for a few of these larger gamers, Uralil mentioned. But the hope is that the corporate will have the ability to outmaneuver them by means of developing a device now not handiest for the top consumer, but additionally employers and different organizations.
I feel we’re taking a look at this as an end-to-end form of answer and revel in,” Cyriac mentioned. “If you look at the current industry, it’s kind of concentrated. It’s a space dominated by banks and other financial institutions. You have thousands of banks, credit unions, third-party admins. That represents the long-fragmented tail of providers in the space. Our goal is not only to transform the experience on the front-end, but it’s the streamline in ways that most providers aren’t thinking, but on the operational back-end.”
For those who were given all of the option to the ground right here, that is the whole listing of buyers in Lively: Streamlined Ventures, Transmedia Capital, Y Combinator, SV Angel, PJC, The Durant Company, Liquid 2 Ventures, Haystack Partners, Paul Buchheit, Isaac Oates, Frederic Kerrest, Jeff Epstein, and “others.”