Positive Account Holder Usage Trends Released by Sterling HSA; New Services Available as Growth Continues

OAKLAND, Calif.--(BUSINESS WIRE)--March 29, 2006--Sterling HSA(TM), a leader in health savings account administration, today announced significant findings regarding the usage of HSA funds by one of its key accounts, the Taft-Hartley Trust collective bargaining unit.

Sterling was the first HSA administrator to serve a Taft-Hartley Trust collective bargaining unit, an account that Sterling acquired through Delta Health Systems, third party administrator (TPA) for the Northern California General Teamsters Security Fund.

The Fund was the first of Delta's accounts to offer an HSA qualified plan. For over 37 years, Delta Health Systems has provided administrative services to members of this Trust, one of the largest Taft Hartley Trusts in California. The Trust Fund elected to add a high deductible, HSA qualified health plan available for negotiations effective January 1, 2005. This is the first Taft-Hartley Trust collective bargaining unit to adopt HSAs and one year later the results are encouraging.

Delta Health Systems and Sterling HSA reported that of the total number of employees covered under a high deductible plan, 61% submitted claims for 2005. Of the total charges credited to the deductibles, 27% were for prescription drugs and 73% were for other medical services. Thirty one percent met their deductible for 2005.

"What is most interesting," said Leslie Hirshfield, Vice President of Corporate Services and Compliance with Delta Health Systems, "are the results of prescription drug claims because this was of particular concern to the Trust. Employees who adopted the high deductible plan and a health savings account on average paid $13.93 per month for prescription drug claims. This compares to approximately $107 per month for the Trust's traditional plans that have no prescription deductible."

Other significant results of the analysis of the Trust's health care program following adoption of health savings accounts and high deductible plans show that the average cost for a high deductible plan in 2005 was $294.96 per employee per month. This compares with an average claim cost of $708.81 for the Trust as a whole. Finally, 44% of the HSA contributions remained in the employees' accounts at the end of 2005 with an average ending balance of $440 per employee, an encouraging sign for the first year of fund accumulation.

Other trends reported by Sterling HSA across its entire account holder base indicate an increase in usage of funds for qualified medical expenses. In 2004 only 29% of account holders used their HSA funds. In 2005 that number increased to 41%. In order of frequency, HSA funds were used for prescription drugs, doctor visits, dental care and hospital visits.

"These trends dispel earlier concerns that HSA adopters would not get the health care they needed in favor of simply accumulating tax deferred savings," said Cora M. Tellez, CEO of Sterling HSA. "HSA use affirms that consumers are making decisions that make sense for themselves and their families. We believe that as HSAs grow, consumer directed health plans will evolve as the preferred solution to transforming medical care financing."

As Sterling continues to grow, the company also announced new on-line services available at www.sterlinghsa.com. Sterling now offers current account holders and employer clients the ability to complete many transactions via its interactive Web site. In addition, Sterling is now offering a new product called the eSavings plan. This account type is geared to individuals who want to open a health savings account that is totally self-managed on-line. Since they will not receive the same level of Sterling personalized service as account holders selecting the Sterling Value or Standard plans, they will pay reduced account management fees.

About Sterling HSA

Sterling HSA, an independent, privately held company, specializes in administering HSAs, or health savings accounts. It is led by a team of experienced healthcare executives and advised by a board of distinguished professionals with expertise in healthcare, banking and the law. In conjunction with eligible insurance plans, HSAs provided by Sterling enable employers to control rising health care costs, subscribers to get the services they need and save money, and insurance professionals to enhance the range of services they can offer to their clients. For more information on HSAs and Sterling HSA, visit www.sterlinghsa.com.

About Delta Health Systems

Delta Health Systems is a national provider of administrative services for self funded health plan sponsors. Founded in 1968, Delta is one of the largest TPAs on the West Coast and manages over 90,000 employee lives. The company focuses on meeting the unique qualifications of each client and has a strong reputation for managing plan expenses. Increasingly, Delta includes consumer driven health plans as part of its business model to better serve clients and take a leadership position in the industry.

For Sterling HSA(TM)
Nancy Brumfield, 206-310-4900