My company switched from JPMC HSA to Optumhealth HSA this year. I was pissed, as we had just started with JPMC last year and now we had to learn all about the twists and turns that a new custodian would provide. As most of us know, cost is not at all straightforward when it comes to HSA. With JPMC with had a few schedule which changed based on dollars invested, what portion my company was paying and if you invested your funds or not. The investment options were poor, but there was an S&P 500 index fund for 20bps.
With Optumhealth we pay no fees - which is awesome. However, they have an annoying policy which keeps you from investing 100% of your funds. You cannot invest in the offered mutual funds until your balance reaches $2100. However, what this means is that you can invest $100, as the minimum investment you can make is $100 and you must have $2000 in cash first. I do a lump sum contribution and thus when I tried to invest $6450 for this years contribution, it only allowed me to invest $4450 and the remaining $2000 had to stay in cash (earning something pathetic - 0.45%?)
However, where Optumhealth got you was with the expense ratios if you choose to invest. The cheapest fund offered was the MainStay S&P 500 Index for a ridiculous 60bps!?! What? Highway robbery. For the sake of simplicity (and having already rolled over funds from JPMC this year), I decided that this was only a small percentage of my portfolio and I would suck up the fees.
Today I login to my Optumhealth account and I see that THEY ADDED NEW FUND OFFERINGS!
Vanguard 500 Index Inv VFINX
Vanguard Wellington Inv VWELX
Vanguard Global Equity Inv VHGEX
(Plus two other funds not worth mentioning.)
I quickly exchanged my MainStay shares for VFINX and will be saving myself 43bps per $10,000!! I'm checking with other folks to see if they also see these options, of if I hit some magical threshold. So AWESOME!
Paying only the ER on VFINX for my HSA is pretty sweet. I can still consider a transfer to HSA Bank if I want to access low cost Bond funds ... but in total I may end up paying more on an annual basis. I don't consider HSA funds "special", so holding 100% equity (minus $2000 in cash) does not bother me.
Just wanted to share with folks who may care.