Insurance: Wells Fargo Puts Medical Savings Accounts On-Line

Wells Fargo's reputation as a reliable bank with a history of serving small business owners was enough to command the attention of the National Federation of Independent Businesses (NFIB)-which ranks fourth in Fortune's "Washington's Power 25" in 1997-and give the bank the chance to offer tailored medical savings accounts (MSAs) to the group's more than 500,000 members. "We felt that Wells Fargo was a strong player that was making a significant commitment to MSAs," says NFIB members services director Bud Curtis.

After Congress passed a trial MSA program in 1996, NFIB's members clamored for information and access to the unique flexible spending accounts (FSAs) that allow small businesses with high-deductible insurance policies to save money in a tax-free custodian account to be used for out- of-pocket medical expenses or eventually for retirement. "It actually wasn't on our target screen, but it came to the front burner very quickly," Curtis says.

Wells tailored a program for NFIB members that offers a special set up rate of $15 versus the non-member fee of $35. Wells collects $2 monthly and $39 annually for asset management. Balances over $2,500 are invested. Because MSAs are available to employers or employees with insurance deductibles above a certain level, the bank can sell insurance to companies whose current policies don't qualify them for the MSA program.

The accounts are available via a toll free telephone number, which is staffed by representatives qualified to answer questions about the plans. In early 1998, NFIB will allow members to receive information and enroll on-line, a convenience Curtis says is valuable to his members. "We felt we should add it because these days Internet use by small and independent businesses is so great," he says.

Wells officials say it's too early to quantify results, but with a Web site as popular as NFIB's-307,000 hits in November 1997, for example-the MSA offering is sure to be on the PC screens of small business owners.

-sausner tfn.com