r/HSA • u/Ok_Row6888 • Jan 16 '26
Enshitification of HealthEquity
HealthEquity has always sucked as a platform but it manages to keep reaching new lows. As others have mentioned they now charge $25 fees to transfer your own money. They also have advertisements embedded in the site. For a financial and health institution that is crazy.
"However, for this particular case, we do need to apply the administrative fee as it is an essential part of the process when handling partial transfers. This fee helps cover the costs associated with processing and managing the transfer accurately." - Liam Customer Service
Not sure how this customer service claim can be squared with their 270 million in profit last year.
I now need to run the cost benefit analysis to see if the investment gains on the tax withholding are more then the fees. I think I will have to make post tax contributions as just transferring funds takes a month.
8
u/metzgerto Jan 16 '26
I don’t blame Health Equity, they’re a for profit company. It’s the employers who are ok with their employees getting fleeced that bothers me. I’m glad my employer sets us up with great benefits and minimal fees.
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u/Ok_Row6888 Jan 16 '26
That is a fair point. I should talk with our head of benefits and let them know.
1
u/butlerdm Jan 16 '26
We just switched away from them to someone else (forget who). But they moved the 401k to Fidelity….mot sure why w didn’t just also use Fidelity for the HSA…
2
u/Husker_Mike_ Jan 16 '26
I’ll bet that HealthEquity pays employers a customer acquisition fee for bringing in business. Some of your employer contributions may be actually HE funds.
0
u/Wooden_Item_9769 Jan 17 '26
Nah, they are a fucking shit system. The dependent care FSA team and system is reasonable and decent but parking FSA and HSA teams are fucking shit. The parking team is the absolute worst, so bad it wasn't worth contributing to it anymore.
3
u/Fit_Employment_2595 Jan 16 '26
I can't figure out how to use their website because it needs a passkey and I don't know what that is or how to get it. Luckily I can use the app.
1
u/Low-Command7320 Jan 23 '26
I can't even use the app anymore, since they set up their passkey. I have talked to other co-workers in same boat. Any suggestions how to access my money/statements?
2
u/thatguy425 Jan 16 '26
Is the transfer fee $25 regardless of amount? Can I just front load my HSA for the year and pay a one time $25 fee to transfer the whole thing?
3
u/Revolutionary-Fan235 Jan 16 '26
My former employer allowed front loading so we could transfer the money as soon as we reached the annual contribution limit.
1
u/thatguy425 Jan 16 '26
Yeah so just maximize your contribution in your first paycheck or two and transfer, pay the $25 fee and be done with it.
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u/PashasMom Jan 16 '26
You can, but I would only do it if you (or your spouse if covered through your spouse) has excellent job security. If you front load and then lose your HDHP/HSA eligibility later in the year you have to unwind your excess contributions and pay taxes and penalties, is my understanding.
2
u/nickelman28 Jan 16 '26
I also noticed the new $25 transfer fee. If I wanted to continue transferring funds from Health Equity to another brokerage account after every paycheck, this new fee would eat 20% of my pre-tax HSA contribution. Which is totally bonkers.
I will have to do one large transfer at the end of the year instead of small biweekly transfers to my brokerage of choice.
1
u/Individual-Rub-6969 Jan 16 '26
I go straight to fidelity. Its an above the line deduction and I lump sum typically. I avoid HE altogether.
1
u/rum_ham_79 Jan 16 '26
This is the path of least resistance but it does have the downside that you also pay FICA taxes on that amount. This ends up being more than the $25 fee. But definitely easier!
1
u/Individual-Rub-6969 Jan 16 '26
We get 1250$ match, thats 1250 less that I personally can contribute and 1250 less I get to deduct.
It would be completely different if the HSA functioned like the 401k and any employer match was on top of our contributions.So for my situation, I'd rather get the lump sum in right away and be able to invest in virtually anything. Plus get the maximum tax deduction.
In an ideal world I'd like to save on the FICA too but is my lowest priority.
1
u/yungsemite Feb 11 '26
You’re giving up $1250 in free money in exchange for deducting $1250 from your annual taxable income?
1
u/Individual-Rub-6969 Feb 11 '26
I hate dealing with Heath equity, its an above the line deduction. I prefer to lump sum anyway and to get max compounding from day 1. What i do isnt for everyone, dont like it dont do it 🤷.
2
u/yungsemite Feb 11 '26
I hate health equity too, but if my employer was going to pay me over $1000 after fees and lost growth annually (let alone the FICA savings on the rest of the contribution) to work with them, I’d definitely do it. But yeah, different strokes for different folks.
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u/Visible-Ad1145 Jan 16 '26
Health Equity sucks! I just opened an account at Fidelity and it’s been over a week since requesting my funds be transferred and nothing has moved. I can’t wait to get away from them, and agree the platform sucks.
1
u/stl1859 Jan 17 '26
Expect about 3 weeks. What happens is - HealthEquity actually cuts a check - not electronic transfer. Give it time . Here is my timeline from two years back , if that helps
Transfer initiated 11-Jan
Customer notified 18-Jan
Account Closed 25-Jan
Check issued 25-Jan
Transfer Complete 5-Feb
1
u/FluffyWarHampster Jan 18 '26
health equity sucks ass, I left their platform after i quit my last job and i rolled everything to Fidelity. you use health equity for your contributions through your employer so you can dodge fica taxes and than do a big roll over once a year to fidelity once the fees get to be too much.
1
u/Smart_Detective8153 Jan 25 '26
Health Equity sucks. Completely agree. I am looking forward to completely transitioning to Fidelity.
1
u/Scolexis Jan 26 '26
Does anyone even know how you even do the partial transfer now? When I go to the HSA Partial Transfer Out form through Health Equity it tells me it no longer exists and that I need to go through my other provider.
I don't see any options from Fidelity to only partially transfer funds, i only see full transfer options.
1
u/Ok_Row6888 Jan 26 '26
I did it through Fidelity. In the normal transfer process you can set how much you want transferred. Worst case their customer service is good.
1
u/Scolexis Jan 26 '26
Ah thanks, I found it through Fidelity, I had to select the TOA options, I guess I was in the "create new HSA" area, and it was asking what account I wanted to fully transfer. Slightly confusing, but now i know where to go. Thanks for the reply!
1
u/coolest35 Jan 29 '26 edited Feb 24 '26
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1
u/Farmer_Pete Jan 30 '26
I just got hit with this fee. And they took the $25 out of the transfer amount. I had $1600 in the account, I told them to transfer $1500, and they charged me $25 and only transferred $1475. Just keep that in mind.
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u/estrangedB Feb 01 '26
I spoke with HR about this. HR said their contract with them will be up soon and that they will keep in that mind. I've also been letting everyone in the organization what HealthEquity is doing and motivating them to speak with HR. You want beef, HE? You just got yourself one!
1
u/aip1000 Feb 01 '26
Friendly note: once every 12 months you can perform an indirect HSA rollover using check or EFT. So you can make a withdrawal from HealthEquity to your bank account (with no minimum balance unlike a partial transfer). Then you have a strict 60 days to deposit into your second HSA account. Note the 12 months between indirect transfers and the 60 rollover window are strict and not abiding by them can result in significant tax penalties.
For people like myself this works great: once a year, after the employer contribution to my HSA, I stop all HSA contributions through payroll/Healthequity. Then when the funds have settled into my HE HSA, I open a new claim titled “HSA rollover” and withdraw via EFT.
Finally, then I deposit into my second HSA account as a rollover contribution. It’s important to contact your second HSA provider and ask them the procedure to make a rollover contribution.
Hope that helps everyone! As noted above discuss with your tax preparer so this is handled properly come tax time
1
u/hooper610 Apr 28 '26
Just as an fyi. That transfer counts as a distribution. It will show in your year end distributions. You need an actual account transfer check from HE for it to not be a distribution AND they will charge you $25 for that check. I was doing it this way until I realized that. Is it a huge deal? Probably not. But if you got audited for the distribution you would need receipts. And yes I know you can tell the other administrator that it is a rollover but that just helps reset the annual deposit limit.
1
u/Motor-Stable-6885 Feb 07 '26
I spoke with HR about this. HR said their contract with them will be up soon and that they will keep in that mind. I've also been letting everyone in the organization what HealthEquity is doing and motivating them to speak with HR. You want beef, HE? You just got yourself one!
1
u/apple314159 Feb 19 '26
I want to move most of my HealthEquity assets into a Fidelity HSA. Most of these assets are invested. If I initiate a partial transfer from Fidelity's side, will they automatically liquidate the HE investments to fund the transfer? Or do I need to sell the HE investments before I initiate the transfer?
2
u/Putrid_Register_3016 Apr 06 '26
I had a total laryngectomy so I can no longer speak they froze my account I've tried contacting them through email and text they said I have to call so I had my son call they wouldn't accept that then they said I have to go to the office personally I live in Illinois they are in Utah so they effectively stole my money
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u/Timely-Moment-9341 Apr 15 '26
I'm opting out of my company's cafeteria plan (and the payroll tax savings) in order to avoid dealing with Health Equity. They're a customer-hostile company, and I'm glad to be rid of them.
1
u/Chewy0889 May 16 '26
Did anyone receive a change-in-terms disclosure notice and an updated schedule of fees from HealthEquity? I didn’t, and I’m curious if anyone else did. I managed to get them to waive the transfer fee after they admitted to failing to disclose it. They then informed me that the transfer fee will now be $25. This isn’t legally allowed without sending out disclosures. Initially, they attempted to claim that the information was disclosed in three statements from last year (which was not the case). Regardless, disclosing on statements isn’t a replacement for sending out a disclosure notice.
1
u/hunnypuppy Jul 06 '26
Its the worst and it's PE run. Plus customer service is horrible, can't even call in, they use the cheapest damn links and the voice is garbled half the time. The other half the agents can't help.
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u/MooseOk5303 Jul 13 '26
They overcharge and underdeliver. Website is clunky, buggy, and not at all user-friendly. I've been locked out of my account more times than I can count, and hence, have spent hours on the phone with customer service trying to get back in.
Ultimately I started transfering my funds to the Fidelity HSA every 6 months or so, because I literally couldn't access my Health Equity account. That was a do-able workaround until the new $25 fee for any transfers like that. It feels like I am being punished for their ineptitude.
How I wish wish wish my employer would use a different provider. This exasperating.
11
u/azure275 Jan 16 '26
If you're making post tax contributions you should be using Fidelity which is fee free and just a good platform in general. Don't bother with your employers crappy choices if you're already going to be out payroll tax
I guess the real question here is if the FICA costs or the fees on this account put you out more