May 2, 2024 • 35 mins
Unlock the secrets of financial health with a deeper dive into the world of Health Savings Accounts (HSAs) as we sit down with Matt Quinn, the savvy mind behind Harvest. Matt illuminates the intricate dance of savings, investments, and tax advantages that HSAs offer, especially post Affordable Care Act. Experience our candid chat as we, your hosts Sam and Maia, share our own HSA stories, reflecting on the smart moves and the occasional stumbles we've encountered in our journey through the healthcare cost maze.
Think managing healthcare costs is a high-wire act? You're not alone. This episode peels back the layers of HSA contribution limits, the quirky 'birthday rule' for dependents, and the savvy strategy of catch-up contributions for the 55-and-over crowd. We even touch on the recent tax return day deadline extension for HSA contributions, offering insights that could change the way you think about your next doctor's visit. Whether it's navigating the system for a family or making the most of your individual plan, we've got the lowdown on how to keep your finances as fit as your health.
But it's not all about the numbers—we're also tackling the ethical tightrope of personal finance data. How do you maximize your financial potential without succumbing to the lure of unnecessary spending? We delve into the finder's fees for spotting eligible expenses and wrestle with the tension between data privacy and value extraction. Plus, we explore how fintech startups are creatively addressing cash flow issues to give you a leg up in today's economy. Tune in and join our conversation as we explore the labyrinth of healthcare savings—it's a journey well worth the listen.
Hosts: Sam Maule & Maia Bittner
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Sam Maule (00:03):
This is Essential Audio.
Hey everybody, welcome toArtificially Intelligent podcast
brought to you by Money 2020.
I'm your host, sam.
Maia Bittner (00:17):
And I'm Maya Bittner.
Today we are talking about HSAs, the tax savings and investment
and health insurance option.
We've got a real expert herewith us, matt Quinn, who is the
founder and CEO of a pretty newstartup called Harvest.
Matt, thanks for coming ontoday.
Matt Quinn (00:39):
Thanks for having me , Beth.
Maia Bittner (00:40):
Yeah, so excited to jump in.
I hear about HSAs being thebest investment choice all the
time.
I feel like it's the mostfrequent thing I see on Twitter.
People are raving about it.
They say it's triple taxadvantage.
Matt, can you give us ahigh-level overview of HSAs?
(01:03):
To start out?
Matt Quinn (01:04):
Sure High level kind of cliff notes on HSAs are post
Affordable Care Act.
We said as a country that youcould get a health care plan
with a high deductible and toincentivize people to do that we
would give them a savingsaccount as an asset.
There's a limit on how muchmoney can go into that savings
(01:27):
account, but the money typicallygoes in untaxed from your
employer and then also from you.
If you want to top up yourcontributions, it will grow
inside of that account untaxedand then if you need to take it
out for medical purposes, youcan pull that out untaxed.
So it actually kind ofaccidentally created what is the
(01:48):
most tax advantage in theoryinvestment account kind of in
the history of America, and it'sa bit of a funny one.
The numbers involved can besuch that it's like annoyingly
small to deal with.
But if you are willing to gothrough the administrative pain
of dealing with that, you canquite literally create like a
(02:11):
million dollar asset that'seffectively tax free when you
retire.
Maia Bittner (02:15):
Well, and so this is new as of the Affordable Care
Act.
Matt Quinn (02:19):
Just after.
So I think 2011 was like themain cementing of when HSAs came
around and these highdeductible plans came.
But the idea was hey, insteadof spending a whole bunch of
money on health insurance, whydon't we?
It's cheaper for an employer,but why don't we just try and
give the like healthaccountability to the customer
(02:41):
or to the patient?
And so if you have a highdeductible plan with HSA, you
are incentivized to do twothings One, when you need help,
to try and find the cheapestoption possible inside your
healthcare network, becauseotherwise you're paying out of
your little asset savings spot.
And two, to just try and takethe best care of your health
possible, such that, like, youractual healthcare costs will be
(03:04):
lower and you can save moremoney in this way.
Maia Bittner (03:08):
Yeah, so the incentives are kind of, yeah,
like align in a way that wedon't often see with healthcare.
Matt Quinn (03:13):
Yeah, I mean, on the flip side, it's probably the
cheapest way your employer canoffer healthcare as well.
So that is incentivized to them.
And I think if there arecertain situations, if you have,
you know, if you, if you, ifyou're looking for health care
and you start and you have achronic illness, then a lot of
times if you're not, if you'remanaging that with medication
(03:34):
and repetitive health care,you're seeing health care
professionals regularly, then ittypically won't work out.
Or if you have, let's say, Iknow out here you have like a
whole bunch of kids who want todo physicals every single year
and you you think you know oneof them has asthma, a couple
things like that, then uh, youwill just burn through your
(03:54):
deduct, your deductible and yourhsa account pretty quickly.
But for if you can start youngenough and you are like health
conscious and you pick you'rekind of picky about your food,
maybe a bit more on the likequantified health or like
biohackery side it's a.
It's a real like no brainergolden ticket kind of plan to
take forwards.
Sam Maule (04:14):
Yeah, it's one of those things, Maya.
It makes me laugh.
Right, Because, as someone intheir fifties now, I'm
constantly looking at, okay,what's life like in retirement?
Right, Because now the clock'sticking, even though it's been
ticking the whole time, but nowyou're like, oh my God, the
clock is ticking.
So when I started reading aboutHSAs, I read an estimate from
(04:35):
Fidelity.
It made me smile.
It said a single person aged 65in 2023 can expect to spend
$157,500 on healthcare inretirement.
Sam, are you ready?
Oh my God, oh my God.
We talked about raising kidsand how expensive it is On the
(04:57):
flip side of it retirement.
Good Lord.
Maia Bittner (05:00):
Well, and the HSA.
So I mean everything Matt issaying sounds really cool, but
if this has been around for only13 years, then it's all a
little bit theoretical, right,like nobody has actually created
a million-dollar HSA to thenuse in retirement, right,
because just not enough time haspassed.
And with the limits oncontributions and investment
(05:23):
returns, is there any risk thatthis kind of doesn't pan out the
way that people think it will?
Matt Quinn (05:31):
There's a theoretical risk for sure that
I'm aware of, the federalgovernment is really greedy, and
at the drop of a hat, the rightlobbyists come in and will pass
a tax bill that says, no, we'renot doing this anymore and you
need to empty out your accountsand you'll pay whatever fees.
Um, I think that actually it'sa it's like not a massive
(05:52):
benefit of what we're trying toachieve, but again, like if
you're putting so the max.
Currently, this year, thecontribution to your hsa will be
, uh, four thousand one hundredand fifty dollars is the limit,
right, it's kind of, if you're ahigh income earner, it's kind
of an an amount of money that isjust annoying to account for in
certain ways, and so one of thethings that I am liking about
(06:13):
what we're doing at Harvest isif the law is changing or is
going to change.
We'll let you know.
Okay, the law has changed.
Fidelity probably will send youone email you get lost on.
Or Health Equity, which is themain HSA fund manager as well,
is like not the best experience,and we really want to try and
(06:37):
help people protect that asset.
Going forwards the money out ofyour HSA pre 65, pre retirement
age and not for medicalexpenses, you pay income tax on
it, plus you pay a 20% penalty.
So one of the things that we'rereally bullish on is trying to
track every.
I don't want to get too intothe weeds because we haven't
(06:57):
really gotten there yet, but wetry and track every out of
pocket medical expense.
And if the law was to changeand they said, okay, you need to
cash out all your medicalexpenses today, we would
hopefully put our users in aposition where they can push a
button and are mostly protectedfrom the changing of the law
going forward.
I would generally think thatthe industry at large would
(07:19):
lobby against the federalgovernment doing that, because
healthcare is wildly expensivefor anybody that touches it and
this is again like the cheapestthe cheapest plan they can offer
.
Sam Maule (07:31):
And that contribution limit.
You were talking about thatroughly about four thousand
dollars.
That's for an individual right,because for a family it goes up
to about eight.
Matt Quinn (07:40):
Yeah, it doubles, so yeah, so this year is four
thousand one hundred and fiftyfor an individual.
No-transcript.
Maia Bittner (07:55):
We actually.
So we just got and this isslightly inspired by you, matt,
but also all of therecommendations I see on Twitter
so we just got an HSA well, notme exactly.
So Dave got an HSA and has ourdaughter on it so that we can
have the family limit and thatshe's covered under that and
(08:17):
that's been so.
We've set that up.
It's been a little bitcumbersome.
So far, our daughter isactually well, she's covered, so
there's overlap.
So she's covered on both myhealth insurance and his health
insurance now and I learned that, so it's been tricky.
So our pediatrician's officesaid that our health insurance
(08:41):
was rejecting her most recentappointments and I said, well,
she's still covered under myinsurance and apparently the
high deductible plan is now theprimary insurance and needs to
be billed first.
And I said, oh, I don't know.
Like why are we making thatprimary?
Let's make mine primary.
But just a weird annoying thingwith health insurance
apparently the primary insurancemust be Dave's because Dave's
(09:04):
birthday happens earlier in theyear.
Matt, you're acting like youalready knew.
This Happens earlier in theyear than mine does and that is
what decides your primaryinsurance.
Matt Quinn (09:13):
This birthday rule is like this niche rule.
That's not.
I don't think it's legallybinding, but most of the
insurance companies respect thisrule.
My understanding and I'mprobably getting it slightly
wrong is that this was writteninto the Affordable Care Act.
You might tell from accident,right?
(09:36):
My wife and I did not grow uphere and are trying to navigate
the US healthcare system.
We said, okay, well, I'm mostlikely to lose or leave my job
or put the baby on yourhealthcare plan.
And then her insurance starteddenying bills.
And bills were coming throughfor everything from the birth of
the child, right, there was anemergency C-section and we
(09:57):
stayed in hospital for eightdays and, like, the numbers on
these bills were so anxietyinducing.
And we've managed.
We've kept talking to people atboth health care plans and none
of them could explain it.
And then we managed to findlike one person knew of this
birthday rule.
So whoever's birthday comes, ifyou both have health care,
whoever's birthday comes firstin the year covers the child for
(10:19):
the first year of life,including the birth experience
is my understanding of that rule.
Maia Bittner (10:24):
And yeah, we yeah, this is the first I heard of it
.
Sam Maule (10:26):
It sounds crazy to me we do everything we can to
protect this industry.
To make it like do you speaklatin?
Wait a minute.
What version of latin do youspeak?
Matt Quinn (10:35):
it oddly looks like my second child now isn't like
isn't mixed up in the birthdayrule, like all the bills are
coming through for my wife'sname, not on my name.
So I did switch from one healthcare provider to a different
health care provider in thatperiod of time, which I wonder
if they don't respect the ruleor whatever but oh, different,
different way yeah yeah, and athing I learned this year when I
(10:57):
was looking at these that Iwish I would have known this
before.
Sam Maule (11:00):
There is also catch up contributions that can be
done when you're over 55.
I represent the over 55 crowd,so here for you, but it made me
laugh because it's only like athousand a year.
So thank you, us government,but wow.
Maia Bittner (11:15):
Not that much ketchup that's uh.
Sam Maule (11:17):
Yeah, because I believe once you enroll in
medicare, you can no longercontribute.
Yeah to an hsa yeah I'm reallygetting this, this end of the
road thing, done down maya.
You can tell I've been doingresearch there's uh, yeah,
there's.
Matt Quinn (11:31):
There's one thousand one, two, fifty five and over.
There's an additional thousanddollars you can add to your
hsa's.
It's catch up again, for, like,it's not inflationary tested.
That's just been the number for10 years, awesome.
And then also, if you don't hityour contribution maximum by
the end of the calendar year,you have until tax ridder turn
day, which I think is april 15in america to add a bit more, a
(11:55):
bit more money, um, which I knowit usually isn't an issue.
But I think people set like apercentage contribution on their
salary.
So if you get a bonus plus likea pay rise, you will end up
essentially having a gap all theother way around.
Um, and again, like I havehealth equity and they didn't
remind me and I was clickingaround and then was like, oh,
I'm missing like a thousanddollars from hsa.
(12:17):
This is like ridiculous.
Um, so, uh, yeah, we, we, uh,we do that, we do the catch-up
contribution as well.
Um, I actually, in the in theuser research for harvest, came
across um, a couple.
The husband is turning 65 thisyear and will retire and has had
(12:37):
a HSA since they were inventedand has never taken anything out
of it and has had it fullyinvested.
So it's worth.
I think it is a couple multiplesix figures.
And he didn't really know.
He just knew that when I retireI'm going to need to put money
on health care premiums.
So when you retire, when youhit 65, you can spend your HSA
(12:57):
on healthcare premiums goingforwards.
But he doesn't have any of thebills that he's ever paid for on
his credit card.
They never.
Really.
It was so new they didn'treally understand this is how
you can do it.
So it was really interestingfor us to say, okay, well, as we
get going, we can probably findlike several tens of thousands
of dollars of healthcareeligible costs in your, in your
(13:20):
grocery bills and your creditcard bills, um, as as harvest
kind of stands up.
So, um, a very interesting usecase, because we typically don't
.
I mean our gem, our de factoposition is that people should
not be spending their hsa.
Maia Bittner (13:35):
If you can, if you can I was gonna say, yeah, and
we, we kind of go right into thedetails but give us a highlight
like so we talked about shouldnot be spending their HSA, if
you can, if you can.
I was going to say, yeah, andwe, we kind of dove right into
the details but give us ahighlight Like so we talked
about HSAs, what is theopportunity for tech to help
here?
Right, we're always interestedin the FinTech angle, like why
were you so motivated to startHarvest?
Matt Quinn (13:53):
So there's yeah, there's like three questions
there to unpack.
So fundamentally right, if youwant to do this the right way.
You want to max out your HSAcontributions to your account
every single year.
When you do have out-of-pocketcosts, you actually don't want
to spend your HSA on those costs.
You want to put them on yourcredit card, ideally, so you get
all the points or some form ofcash and then to hold on to
(14:16):
those records and at a undefinedfuture date you could just
reimburse yourself the amount ofeligible costs back to your
bank.
So what you can do is thenallow that money in your HSA to
grow in the stock market.
It mines all in, like VT sacksor one of the Vanguard in the
low cost index funds.
Grow for 15 years.
(14:37):
Take out the eligible amountand leave the kind of growth in
there to move forward on yourhealthcare premiums or whatever.
That is the ideal way to do this.
Even to think about that comeswith a bunch of admin.
So there's a couple of thingsin there.
One is max out every singleyear.
The providers don't tell you,so you have to remember I'm
(15:00):
maxing out this much or I've putin too much.
I need to make sure that we'regoing to get, get that
appropriately maxed out.
Two is make sure your funds areinvested.
So health equity your default,put them in a cash account.
You then have to opt in toputting them in the market.
(15:21):
They actually-sneakily justadded a fund, a charge, on your
fund balance.
So I know most of the people atmy org who use health equity
are now switching over tofidelity, which don't charge
anything to use low-cost fundsplus health equity also only
give you like seven investmentoptions and they're all pretty
bad.
So you want to make sure you'reputting it probably in fidelity
to invest in pretty decentlow-cost index funds across
(15:41):
market, or you can be morespecific.
I think ultimately that'ssomething that Harvest would
love to explore.
And then you need to manageappropriately.
Manage the documentation ofwhat you spend out of pocket.
So when you reimburse, there'sthen a three-year statute of
limitation that the IRS can lookat what you reimbursed yourself
(16:02):
for, as long as there's nosuspicion of fraud.
So if I'm spending money onpediatricians and stuff this
year and I want to store thatdocumentation for 15 years and
be able to make a claim easilyin 15 years time and have an
ironclad case that I knewexactly what was going on.
That just comes with a hugeamount of paperwork and admin,
(16:23):
and so for me personally, when Ifinally said, okay, four
thousand dollars for me, my wifehas to say it's four thousand
dollars for her like this isenough money that we should
start looking at this.
Uh, you know this kind of magicreimbursement system.
We were taking pictures ofbills.
We're sticking them for usAirtable.
But most people I've spoken toare taking photos, sticking them
(16:45):
in Google Drives, takingrenaming file names, sticking
them in Google Sheets reallyjust the most laborious record
keeping you can do.
That got us to a certain levelof doing Airtable.
Okay, I have my PDF, I have my,my context, whatever.
But, um, the magic here hasbecome, if you really are a bit
frugal like me, in 2020.
(17:08):
Uh, with the pandemic, the lawschanged such that, uh, things
that were kind of covid relatedbecame hsa eligible.
So, all of a sudden and that'sretrospective all of a sudden
and that's retrospective all ofa sudden for the past 10 years,
anything you've spent on antacid, headache stuff, cold and flu
medication, masks, handsanitizer, diaper cream for your
(17:30):
kid or anything that has an SPFnumber so makeup with one SPF
all of a sudden became HSAeligible to document.
Maia Bittner (17:41):
I think even my air purifier is.
I sent it to my FSA which.
Matt Quinn (17:46):
I have mostly for smoke, Aura rings prescription
glasses, like so much stuff, hasbecome eligible To track down
the odd $5, $15, $125 in groceryon Amazon All of that is
basically nonsensical.
I tried it, which is really whatthe personal pain was like.
I need to be able to automatethis, and so I spent two hours
(18:09):
going through three years ofAmazon history to pull out $700
of eligible spend and kind ofwent, that was just Amazon that
didn't touch Costco Sam's Clubspend and kind of went, that was
just amazon that didn't touchcostco sam's club, king supers,
all of my other um kind ofgrocery locations, and uh, and
said, yeah, okay, this is abetter way and that's that's
fundamentally what um, whatharvest is working on.
So we both give you the toolsto safely document all of this
(18:33):
paperwork forever and at theclick of a button you can
download it all.
It will be there.
You don't have to worry aboutthe service dying it's not going
to happen, but sure, um.
And then also we have found away to pull through amazon
history, flag everything youspent money on that's hsa
eligible um and store that aswell, store those receipts and
at some point, whether you needit now or a future.
You can kind of literally push abutton and and get the
(18:54):
reimbursement processed.
Um, and we've started withAmazon, but very soon it will be
Sam's Club, costco everywhere,american's shop that keeps an
online record of your groceryshopping.
Sam Maule (19:07):
So we actually did an episode Matt I can't remember
when a few weeks ago, maya wherewe talked about startups, right
and talking about okay, tell meabout the product, what is the
problem you're solving?
You've done a great job, we'vegot that covered.
I think we can check the boxand say we got it.
One of the flip things in myalways talk about is okay, cool,
so what's your business model,what's the revenue model?
(19:29):
So can we go there?
Matt Quinn (19:30):
Sure, sure.
I think it's definitely a bigquestion for us on when we've
written it down.
There's so many points of valuethat we add here and capturing
a slice of that value is alittle tricky.
Some ways that we've seen itdone and have been suggested to
(19:51):
us is OK, why don't you chargeon reimbursement?
And the challenge with that istwo things.
We really don't want toencourage people to reimburse
this money.
We would like to help enablethem to store this kind of
account balance for as long aspossible, and so for us to start
, we're just saying hey, look,you can upload all your
(20:11):
documents, you can store allthis stuff for 15 years, totally
fine.
There's really not enough valuethere for us to go and try and
take a slice.
But I spent two hours trying tofind just my Amazon history.
Right, that was $700.
If I can push a button and thatcan find $700 for me, harvest
is asking okay, if we findanything that is a grocery
(20:31):
expense in the last 12 months,we would love a 3% finder's fee,
and as those items age, I thinkit becomes a 4% finders fee.
So you can push a button andwe'll say hey, we found $1,000
worth of stuff If you don't wantto pay for it.
It's here.
It will just get a little bitmore expensive as you kind of
wait, but if you paid $4, youwill have these expenses in your
(20:53):
account for the rest of yourlife.
You have access to it, you haveall the documentation and
that's definitely where we'restarting.
There's a whole bunch of avenuesthat come off of that and we're
still trying to gauge wherepeople are on data privacy, one
of the things that becomes quiteinteresting when you have
somebody doing this every sixmonths and running to keep this
data.
(21:13):
We get really, really freshunified customer data at the
item level.
So somebody could look at myprofile, for example, and see,
like, okay, well, on Amazon, Ibuy this brand of diapers every
single month, but when I go tothe grocery store, I'm buying
this, and when I go to Sam'sClub, I'm buying this.
(21:35):
There isn't really a servicethat takes all of those three
things together, right, becauseyou could slice one of those
things off and make a wholebunch of assumptions, as me as a
customer.
So there's two parts therewhich is like can we get enough
data and then anonymize it tomake it both comfortable for the
user and also valuable for thebusiness, but that's something
(21:56):
we're exploring.
Still, that works best,obviously, at a critical mass.
No, I get it.
Sam Maule (22:04):
It's kind of like rocket money right, maya, I'll
go out and find all yoursubscriptions, I'll do the work
for you.
So you're a painkiller.
What is the laborious part ofit?
What's the pain you're solving?
It makes sense, right?
So rocket money does it,because it goes out and finds
out all the apps you'resubscribed to or subscriptions
you have, and then cancel themfor you.
It's like and the yin to theyang of that.
(22:26):
This is finding money that youhave spent and is applicable for
this, or saving you and savingtime.
Matt Quinn (22:32):
It's one of the greatest things in the world you
can do is save me time exactly,and I think there's um, one of
I won't say heartbreaking, butone of the like upsetting parts
of this is uh, I mean, I'mhaving my own health care
experience at the moment.
Everything in my experienceabout the healthcare system and
these accounts is like not easy.
(22:53):
It's just not simple, complex,like simple and understandable.
And so, as we've delved furtherinto this area, I meet people
who think that they are the mostfinancially savvy people on the
planet and they don'tunderstand the hsa.
They don't understand how itworks, they don't understand how
they get money out, and so theywill actively spend their
(23:15):
account balance every singleyear because they want that cash
as soon as possible.
Um and uh.
Then, when it comes to the fsa,which is kind of it's like a
little sister which we also workwith, people will actively go
and look for stuff, and it'susually stuff.
They go filter for FSA eligiblestuff, hsa eligible stuff.
They go oh, I'm going to buy anaura ring.
(23:36):
I don't even need to sleeptrack, but I'm just going to buy
it because I know it's eligibleand I can get the cash out.
And that's just reallychallenging to see that someone
would waste an opportunity,right, but they don't
necessarily realize it on theflip side.
So we get to say, hey, youdon't actually need to do that.
We've already found the $2,000you need back today.
Just push a button, pay alittle fee and push a button and
(23:57):
you get to save an enormousamount of cash there.
When I was looking into thespace originally, and you just
search FSA or HSA on Twitter,you can start to see this.
You get people who I think area bit more vanilla with their
money and potentially withcareers get looped into.
Oh, you know, sephora is nowHSA eligible because they've
(24:20):
managed to make all thefoundations one SPF and the
mascara is one SPF.
And so it gets to November.
Someone goes oh, I've got$2,000 in an FSA, I'm just going
to spend it on Sephora andyou're like I could just give
you $2,000 of cash or $1,999 ofcash.
You don't need to waste thismoney in that way.
Maia Bittner (24:42):
Well, that's cool, and not only that.
People are always pitching mefintech startups.
I feel like half of the pitchesI get are saying you know, 50%
of Americans don't have $400 oryou know, and they come up with
then like bad solutions to thatproblem, usually lending.
And so this is kind of asolution to that problem, right,
helping out Americans who havecash flow crunches, but in a
(25:05):
pretty financially advantageousway, which is like great, you've
got this HSA.
The best thing to do is to holdit until retirement.
But if you need cash now forsome kind of an emergency and
you've been tracking youreligible expenses and you've
been buying them with a creditcard and not expensing them to
your HSA, historically you cankind of help people out in that
way.
Sam Maule (25:24):
I mean, it's one of those things.
Right, you're guaranteed acouple of things.
One you're going to pay taxes,right, I mean, we know that.
But the other is and again,this is, this is your uncle Sam,
everybody who's 57 and lookingforward to the horizon You're
going to get sick.
You're going to get sick.
I go to the gym every day, Iwork out and all that.
(25:44):
I know what those costs aregoing to look like.
One, because I grew up with amother who had multiple
sclerosis, so we saw those kindsof bills.
But two, I'm also at the stageof my life where I had to take
care of my father and in-lawsbecause they had aged Right, and
so I.
It's just, those medical costsare coming.
We're all going to get hit byit.
I don't care how good you are.
(26:10):
Arnold Schwarzenegger had aheart attack.
Arnie, come on, the man hashospital bills, just like the
rest of us.
So this is one of those thingsthat earlier you get.
Now I'm going to get off ofthis recording and go yell at my
daughters and say what are youdoing on your HSAs?
Because it makes sense.
It's one of those start early,right, maya?
We talked about this with thekids and the college savings
plans.
This fits right into.
I think we could build achecklist coming out of this
podcast.
Maya, for all right, you're 18.
Cool, here's all the things youshould be looking at when you
(26:33):
start your career.
Matt Quinn (26:35):
It's definitely.
I mean there's also someidealistic parts to it.
I don't think that there'smonetizable value here.
But if you are embracing beingtotally accountable to your
health and making healthydecisions, we would in theory
have the opportunity of lookingat everything you buy at the
(26:55):
grocery store and flagging andsay, hey, you actually probably
could swap this for this.
Or like the science is trendingthat like if you eat that thing
for long enough, you're goingto be in serious trouble in 20
years.
Like if you eat that thing forlong enough, you're going to be
in serious trouble in 20 years.
I think that that's an untestedidea that I would personally
(27:15):
love.
I don't know how the averageAmerican who wants to be left
alone kind of would feel aboutit, but I do know like people
are eating.
I would say I just recentlydiscovered I've been putting red
forth like stuff with red 40 inmy food.
I use that mio, you knowelectrolyte stuff.
I'm doing a bunch of exerciseand I was looking at the
ingredients the other day, beinglike I didn't even realize I'm
(27:36):
drinking this red 40 stuff,which is abhorrent, and I in no
way should anybody been eatingthat.
So it would be.
There's like pretty cool thingsthat we could do there with
some of that data to try and getpeople to be a bit more
accountable there.
Sam Maule (27:51):
The ex-Googler in me looks at this and goes yes, your
personal AI that we're allgoing to have.
That's going to help us makethose financial decisions and
based upon our individualspending history.
If you really want to knowsomebody, there's two things
right Know what their searchhistory is, which is a whole
other item.
And then the second is how doyou spend your money?
Because that's what you value.
(28:11):
That's just reality.
Where do you spend your moneyand where do you spend your time
?
So matt, I mean, that componentof it actually makes sense to
me that that's something youcould grow into.
The more data you're collectingand the farther along you can
do, it's still a value-addedservice it could be so
interesting.
Matt Quinn (28:27):
Right like um, you get I know my, and I've
discussed this before.
There's a little blurry areawhere it's like are you giving
medical advice do?
Is there a?
Is there a line?
You cross there?
But I think for there are.
There are healthier choicesthat people avoid because they
think they're too expensive inthe short term, and I think we
could do some really interestingstuff to say you know what?
(28:48):
I can see you buy the cheapesteggs.
Last year you bought 156 of thecheapest eggs.
If you bought pasture raisedeggs from the place you already
shop at, that's a $20 changeyear over year.
And here's all of the sciencethat would say that this would
be phenomenal for your health,things like that.
They're obviously like-.
Maia Bittner (29:08):
Well, right, because they're trying to save
money, and it's like, actually,you could save money by buying
the more expensive eggs.
If you take the right viewpointon it, I think red dye number
40 is actually illegal in manycountries, including Canada.
I know this because I livequite close to Canada, I spend a
lot of time there and theirfruit loops are not as bright,
live quite close to canada, Ispend a lot of time there and
(29:29):
their fruit loops are not asbright.
Uh, but I think, right, it'slike could you do not medical
advice, but help me eat in waysthat are legal in other
civilized countries yeah, my uh.
Matt Quinn (29:39):
Well, now I have a one month old, so my parents are
coming out this weekend andthey are both, uh, americans,
born, raised here, but I don'tthink they commonly forget what
has happened.
Every time they come out I givethem a little talk.
I'm like, if you keep eatingthe way you think you eat
healthily in England, it's notthe same.
Quaker Oats has fiveingredients in London.
(30:01):
Quaker Oats has 50 in America.
Be careful with what you'regoing to buy here, because it's
not the same stuff.
Sam Maule (30:09):
We're all chemists.
Maia Bittner (30:10):
So one of the things yeah you make me think of
with the eggs.
Right is how expensive it is tobe poor.
Long term, it's cheaper to buythe better eggs because you're
going to be spending less moneyon health insurance.
That's probably true regardlessof whether you're using an HSA
or even a standard healthinsurance plan.
But some people just can'tafford that.
(30:30):
And HSAs in general, this wholeplan about like well, just
cover your health expenses, nowlet the money compound in your
HSA accounts and in thoseinvestments might be out of
reach for some people.
Do you think that this is anadvantage that only applies to
rich people?
Who can it help?
Matt Quinn (30:50):
That's a good question, definitely something
we're cognizant of.
There's like a two-tieredanswer, right?
So if you have a HSA, there's30 million HSA and FSA account
holders in America.
Maia Bittner (31:03):
If, you have a.
Matt Quinn (31:04):
HSA.
Typically you work for a prettybig company, so I don't think
it is your small businesses thatare offering these plans.
It is a Broadcom or a WellsFargo or a Facebook.
So right off the bat, youprobably have a higher than
median income, I would imagine,or you're on the path to do that
(31:25):
, I would imagine, or you're onthe path to do that.
So it definitely sparks adifferent conversation around,
like cost of healthcare andgetting, getting getting access
to some of these things.
It's a less, it's an absolutelylike less than ideal situation.
(31:52):
There's nothing, really nothing,worse than seeing the, the cost
of healthcare and food andeverything to the hardest hit
kind of Americans.
It's not, it's just really notan area I think that we know how
to address in many ways.
But it would be interesting tosee as time goes on, from maybe
I think this well from maybemore of an altruistic standpoint
, but it'd be really interestingto see what parts of harvest we
(32:12):
could repurpose to give averagejoe the same level of
opportunity and reviewing whatthey buy and um, and saving
money and I think the there'sdefinitely another piece here
around, like I've seen peoplewho, uh, who have taken money
out of the hsa's in an emergencyright.
So let's say you, even if you,um, are a bit of a higher income
(32:33):
, you still have emergencyspending.
If we, we have this idea,that's like if we are tracking
all of your out-of-pocketmedical expenses and grocery
bills and we know the hsabalance is fifteen thousand
dollars and you have tenthousand dollars you can
reimburse today, instead ofliquidating that, hurting
yourself on a 20-year timelineaway from investing those funds
and also paying the tax penalty,there's room there to give
(32:56):
someone quite favorable creditterms away from the penalty and
say, okay, we'll give you asix-month loan, worst case
security, we'll reimburse thisamount and take the money back
from you.
So you don't have to incur thattax penalty Penalty is 20%.
So if the six month loaninterest is within that like,
you won't actually have to paythat penalty, and so we don't
(33:19):
feel that that it would bepredatory.
We actually feel like there's alot of value in every party
there, so there's definitely afuture ambition for us party
there.
So there's definitely a futureambition for us.
But right now, tracking thisout-of-pocket HSA amount is
effectively like a ghost assetin many ways, and I think we
could create a lot of comfortfor people who do need a lot
(33:40):
more, who have unpredictablecash flow problems, let's say
but yeah, yeah, the idea isfantastic, fantastic.
Sam Maule (33:47):
It's one that'll be interesting to watch how this
grows.
There's a pun everybody, so, so, matt.
Where's the best place for thepeople that are listening to
understand more about harvestand where y'all are headed?
Matt Quinn (33:59):
sure everything for us is online, so the website is
hsaharvestcom.
Uh, currently we have a winglist, but if you sign up early
you geta little bonus where youcan earn a percentage of
everything harvested fromeverybody you refer and we're
slowly letting people in to testout, test out the product and
move forwards there and it'salso a great link.
Sam Maule (34:18):
I was looking at the site.
Anything you want to know abouthsa's, just go there.
I mean it's documented out.
You can get a degree in uh in h.
So, Matt, thank you so much.
It's a fascinating sector towatch and see where this goes.
Us healthcare everybody justmake your head hurt.
Well, that's it for today'sepisode.
(34:40):
We want to thank you all forlistening.
Please do go out and give us areview and tell your friends
about the podcast.
Review should be five starsalways.
I don't think there's anythingunder five.
Come on, Be good to us.
If you want to reach out to me,give us ideas for a show.
You can find me on Twitter oron LinkedIn.
Maya, how about you?
Maia Bittner (34:58):
I'm also on Twitter at Maya B.
I have open DMs.
Feel free to message me anytime.
And hey, thanks so much forlistening to Artificially
Intelligent.
This is Essential Audio.
Hey everybody, welcome toArtificially Intelligent podcast
brought to you by Money 2020.
I'm your host, sam.
Maia Bittner (00:17):
And I'm Maya Bittner.
Today we are talking about HSAs, the tax savings and investment
and health insurance option.
We've got a real expert herewith us, matt Quinn, who is the
founder and CEO of a pretty newstartup called Harvest.
Matt, thanks for coming ontoday.
Matt Quinn (00:39):
Thanks for having me , Beth.
Maia Bittner (00:40):
Yeah, so excited to jump in.
I hear about HSAs being thebest investment choice all the
time.
I feel like it's the mostfrequent thing I see on Twitter.
People are raving about it.
They say it's triple taxadvantage.
Matt, can you give us ahigh-level overview of HSAs?
(01:03):
To start out?
Matt Quinn (01:04):
Sure High level kind of cliff notes on HSAs are post
Affordable Care Act.
We said as a country that youcould get a health care plan
with a high deductible and toincentivize people to do that we
would give them a savingsaccount as an asset.
There's a limit on how muchmoney can go into that savings
(01:27):
account, but the money typicallygoes in untaxed from your
employer and then also from you.
If you want to top up yourcontributions, it will grow
inside of that account untaxedand then if you need to take it
out for medical purposes, youcan pull that out untaxed.
So it actually kind ofaccidentally created what is the
(01:48):
most tax advantage in theoryinvestment account kind of in
the history of America, and it'sa bit of a funny one.
The numbers involved can besuch that it's like annoyingly
small to deal with.
But if you are willing to gothrough the administrative pain
of dealing with that, you canquite literally create like a
(02:11):
million dollar asset that'seffectively tax free when you
retire.
Maia Bittner (02:15):
Well, and so this is new as of the Affordable Care
Act.
Matt Quinn (02:19):
Just after.
So I think 2011 was like themain cementing of when HSAs came
around and these highdeductible plans came.
But the idea was hey, insteadof spending a whole bunch of
money on health insurance, whydon't we?
It's cheaper for an employer,but why don't we just try and
give the like healthaccountability to the customer
(02:41):
or to the patient?
And so if you have a highdeductible plan with HSA, you
are incentivized to do twothings One, when you need help,
to try and find the cheapestoption possible inside your
healthcare network, becauseotherwise you're paying out of
your little asset savings spot.
And two, to just try and takethe best care of your health
possible, such that, like, youractual healthcare costs will be
(03:04):
lower and you can save moremoney in this way.
Maia Bittner (03:08):
Yeah, so the incentives are kind of, yeah,
like align in a way that wedon't often see with healthcare.
Matt Quinn (03:13):
Yeah, I mean, on the flip side, it's probably the
cheapest way your employer canoffer healthcare as well.
So that is incentivized to them.
And I think if there arecertain situations, if you have,
you know, if you, if you, ifyou're looking for health care
and you start and you have achronic illness, then a lot of
times if you're not, if you'remanaging that with medication
(03:34):
and repetitive health care,you're seeing health care
professionals regularly, then ittypically won't work out.
Or if you have, let's say, Iknow out here you have like a
whole bunch of kids who want todo physicals every single year
and you you think you know oneof them has asthma, a couple
things like that, then uh, youwill just burn through your
(03:54):
deduct, your deductible and yourhsa account pretty quickly.
But for if you can start youngenough and you are like health
conscious and you pick you'rekind of picky about your food,
maybe a bit more on the likequantified health or like
biohackery side it's a.
It's a real like no brainergolden ticket kind of plan to
take forwards.
Sam Maule (04:14):
Yeah, it's one of those things, Maya.
It makes me laugh.
Right, Because, as someone intheir fifties now, I'm
constantly looking at, okay,what's life like in retirement?
Right, Because now the clock'sticking, even though it's been
ticking the whole time, but nowyou're like, oh my God, the
clock is ticking.
So when I started reading aboutHSAs, I read an estimate from
(04:35):
Fidelity.
It made me smile.
It said a single person aged 65in 2023 can expect to spend
$157,500 on healthcare inretirement.
Sam, are you ready?
Oh my God, oh my God.
We talked about raising kidsand how expensive it is On the
(04:57):
flip side of it retirement.
Good Lord.
Maia Bittner (05:00):
Well, and the HSA.
So I mean everything Matt issaying sounds really cool, but
if this has been around for only13 years, then it's all a
little bit theoretical, right,like nobody has actually created
a million-dollar HSA to thenuse in retirement, right,
because just not enough time haspassed.
And with the limits oncontributions and investment
(05:23):
returns, is there any risk thatthis kind of doesn't pan out the
way that people think it will?
Matt Quinn (05:31):
There's a theoretical risk for sure that
I'm aware of, the federalgovernment is really greedy, and
at the drop of a hat, the rightlobbyists come in and will pass
a tax bill that says, no, we'renot doing this anymore and you
need to empty out your accountsand you'll pay whatever fees.
Um, I think that actually it'sa it's like not a massive
(05:52):
benefit of what we're trying toachieve, but again, like if
you're putting so the max.
Currently, this year, thecontribution to your hsa will be
, uh, four thousand one hundredand fifty dollars is the limit,
right, it's kind of, if you're ahigh income earner, it's kind
of an an amount of money that isjust annoying to account for in
certain ways, and so one of thethings that I am liking about
(06:13):
what we're doing at Harvest isif the law is changing or is
going to change.
We'll let you know.
Okay, the law has changed.
Fidelity probably will send youone email you get lost on.
Or Health Equity, which is themain HSA fund manager as well,
is like not the best experience,and we really want to try and
(06:37):
help people protect that asset.
Going forwards the money out ofyour HSA pre 65, pre retirement
age and not for medicalexpenses, you pay income tax on
it, plus you pay a 20% penalty.
So one of the things that we'rereally bullish on is trying to
track every.
I don't want to get too intothe weeds because we haven't
(06:57):
really gotten there yet, but wetry and track every out of
pocket medical expense.
And if the law was to changeand they said, okay, you need to
cash out all your medicalexpenses today, we would
hopefully put our users in aposition where they can push a
button and are mostly protectedfrom the changing of the law
going forward.
I would generally think thatthe industry at large would
(07:19):
lobby against the federalgovernment doing that, because
healthcare is wildly expensivefor anybody that touches it and
this is again like the cheapestthe cheapest plan they can offer
.
Sam Maule (07:31):
And that contribution limit.
You were talking about thatroughly about four thousand
dollars.
That's for an individual right,because for a family it goes up
to about eight.
Matt Quinn (07:40):
Yeah, it doubles, so yeah, so this year is four
thousand one hundred and fiftyfor an individual.
No-transcript.
Maia Bittner (07:55):
We actually.
So we just got and this isslightly inspired by you, matt,
but also all of therecommendations I see on Twitter
so we just got an HSA well, notme exactly.
So Dave got an HSA and has ourdaughter on it so that we can
have the family limit and thatshe's covered under that and
(08:17):
that's been so.
We've set that up.
It's been a little bitcumbersome.
So far, our daughter isactually well, she's covered, so
there's overlap.
So she's covered on both myhealth insurance and his health
insurance now and I learned that, so it's been tricky.
So our pediatrician's officesaid that our health insurance
(08:41):
was rejecting her most recentappointments and I said, well,
she's still covered under myinsurance and apparently the
high deductible plan is now theprimary insurance and needs to
be billed first.
And I said, oh, I don't know.
Like why are we making thatprimary?
Let's make mine primary.
But just a weird annoying thingwith health insurance
apparently the primary insurancemust be Dave's because Dave's
(09:04):
birthday happens earlier in theyear.
Matt, you're acting like youalready knew.
This Happens earlier in theyear than mine does and that is
what decides your primaryinsurance.
Matt Quinn (09:13):
This birthday rule is like this niche rule.
That's not.
I don't think it's legallybinding, but most of the
insurance companies respect thisrule.
My understanding and I'mprobably getting it slightly
wrong is that this was writteninto the Affordable Care Act.
You might tell from accident,right?
(09:36):
My wife and I did not grow uphere and are trying to navigate
the US healthcare system.
We said, okay, well, I'm mostlikely to lose or leave my job
or put the baby on yourhealthcare plan.
And then her insurance starteddenying bills.
And bills were coming throughfor everything from the birth of
the child, right, there was anemergency C-section and we
(09:57):
stayed in hospital for eightdays and, like, the numbers on
these bills were so anxietyinducing.
And we've managed.
We've kept talking to people atboth health care plans and none
of them could explain it.
And then we managed to findlike one person knew of this
birthday rule.
So whoever's birthday comes, ifyou both have health care,
whoever's birthday comes firstin the year covers the child for
(10:19):
the first year of life,including the birth experience
is my understanding of that rule.
Maia Bittner (10:24):
And yeah, we yeah, this is the first I heard of it
.
Sam Maule (10:26):
It sounds crazy to me we do everything we can to
protect this industry.
To make it like do you speaklatin?
Wait a minute.
What version of latin do youspeak?
Matt Quinn (10:35):
it oddly looks like my second child now isn't like
isn't mixed up in the birthdayrule, like all the bills are
coming through for my wife'sname, not on my name.
So I did switch from one healthcare provider to a different
health care provider in thatperiod of time, which I wonder
if they don't respect the ruleor whatever but oh, different,
different way yeah yeah, and athing I learned this year when I
(10:57):
was looking at these that Iwish I would have known this
before.
Sam Maule (11:00):
There is also catch up contributions that can be
done when you're over 55.
I represent the over 55 crowd,so here for you, but it made me
laugh because it's only like athousand a year.
So thank you, us government,but wow.
Maia Bittner (11:15):
Not that much ketchup that's uh.
Sam Maule (11:17):
Yeah, because I believe once you enroll in
medicare, you can no longercontribute.
Yeah to an hsa yeah I'm reallygetting this, this end of the
road thing, done down maya.
You can tell I've been doingresearch there's uh, yeah,
there's.
Matt Quinn (11:31):
There's one thousand one, two, fifty five and over.
There's an additional thousanddollars you can add to your
hsa's.
It's catch up again, for, like,it's not inflationary tested.
That's just been the number for10 years, awesome.
And then also, if you don't hityour contribution maximum by
the end of the calendar year,you have until tax ridder turn
day, which I think is april 15in america to add a bit more, a
(11:55):
bit more money, um, which I knowit usually isn't an issue.
But I think people set like apercentage contribution on their
salary.
So if you get a bonus plus likea pay rise, you will end up
essentially having a gap all theother way around.
Um, and again, like I havehealth equity and they didn't
remind me and I was clickingaround and then was like, oh,
I'm missing like a thousanddollars from hsa.
(12:17):
This is like ridiculous.
Um, so, uh, yeah, we, we, uh,we do that, we do the catch-up
contribution as well.
Um, I actually, in the in theuser research for harvest, came
across um, a couple.
The husband is turning 65 thisyear and will retire and has had
(12:37):
a HSA since they were inventedand has never taken anything out
of it and has had it fullyinvested.
So it's worth.
I think it is a couple multiplesix figures.
And he didn't really know.
He just knew that when I retireI'm going to need to put money
on health care premiums.
So when you retire, when youhit 65, you can spend your HSA
(12:57):
on healthcare premiums goingforwards.
But he doesn't have any of thebills that he's ever paid for on
his credit card.
They never.
Really.
It was so new they didn'treally understand this is how
you can do it.
So it was really interestingfor us to say, okay, well, as we
get going, we can probably findlike several tens of thousands
of dollars of healthcareeligible costs in your, in your
(13:20):
grocery bills and your creditcard bills, um, as as harvest
kind of stands up.
So, um, a very interesting usecase, because we typically don't
.
I mean our gem, our de factoposition is that people should
not be spending their hsa.
Maia Bittner (13:35):
If you can, if you can I was gonna say, yeah, and
we, we kind of go right into thedetails but give us a highlight
like so we talked about shouldnot be spending their HSA, if
you can, if you can.
I was going to say, yeah, andwe, we kind of dove right into
the details but give us ahighlight Like so we talked
about HSAs, what is theopportunity for tech to help
here?
Right, we're always interestedin the FinTech angle, like why
were you so motivated to startHarvest?
Matt Quinn (13:53):
So there's yeah, there's like three questions
there to unpack.
So fundamentally right, if youwant to do this the right way.
You want to max out your HSAcontributions to your account
every single year.
When you do have out-of-pocketcosts, you actually don't want
to spend your HSA on those costs.
You want to put them on yourcredit card, ideally, so you get
all the points or some form ofcash and then to hold on to
(14:16):
those records and at a undefinedfuture date you could just
reimburse yourself the amount ofeligible costs back to your
bank.
So what you can do is thenallow that money in your HSA to
grow in the stock market.
It mines all in, like VT sacksor one of the Vanguard in the
low cost index funds.
Grow for 15 years.
(14:37):
Take out the eligible amountand leave the kind of growth in
there to move forward on yourhealthcare premiums or whatever.
That is the ideal way to do this.
Even to think about that comeswith a bunch of admin.
So there's a couple of thingsin there.
One is max out every singleyear.
The providers don't tell you,so you have to remember I'm
(15:00):
maxing out this much or I've putin too much.
I need to make sure that we'regoing to get, get that
appropriately maxed out.
Two is make sure your funds areinvested.
So health equity your default,put them in a cash account.
You then have to opt in toputting them in the market.
(15:21):
They actually-sneakily justadded a fund, a charge, on your
fund balance.
So I know most of the people atmy org who use health equity
are now switching over tofidelity, which don't charge
anything to use low-cost fundsplus health equity also only
give you like seven investmentoptions and they're all pretty
bad.
So you want to make sure you'reputting it probably in fidelity
to invest in pretty decentlow-cost index funds across
(15:41):
market, or you can be morespecific.
I think ultimately that'ssomething that Harvest would
love to explore.
And then you need to manageappropriately.
Manage the documentation ofwhat you spend out of pocket.
So when you reimburse, there'sthen a three-year statute of
limitation that the IRS can lookat what you reimbursed yourself
(16:02):
for, as long as there's nosuspicion of fraud.
So if I'm spending money onpediatricians and stuff this
year and I want to store thatdocumentation for 15 years and
be able to make a claim easilyin 15 years time and have an
ironclad case that I knewexactly what was going on.
That just comes with a hugeamount of paperwork and admin,
(16:23):
and so for me personally, when Ifinally said, okay, four
thousand dollars for me, my wifehas to say it's four thousand
dollars for her like this isenough money that we should
start looking at this.
Uh, you know this kind of magicreimbursement system.
We were taking pictures ofbills.
We're sticking them for usAirtable.
But most people I've spoken toare taking photos, sticking them
(16:45):
in Google Drives, takingrenaming file names, sticking
them in Google Sheets reallyjust the most laborious record
keeping you can do.
That got us to a certain levelof doing Airtable.
Okay, I have my PDF, I have my,my context, whatever.
But, um, the magic here hasbecome, if you really are a bit
frugal like me, in 2020.
(17:08):
Uh, with the pandemic, the lawschanged such that, uh, things
that were kind of covid relatedbecame hsa eligible.
So, all of a sudden and that'sretrospective all of a sudden
and that's retrospective all ofa sudden for the past 10 years,
anything you've spent on antacid, headache stuff, cold and flu
medication, masks, handsanitizer, diaper cream for your
(17:30):
kid or anything that has an SPFnumber so makeup with one SPF
all of a sudden became HSAeligible to document.
Maia Bittner (17:41):
I think even my air purifier is.
I sent it to my FSA which.
Matt Quinn (17:46):
I have mostly for smoke, Aura rings prescription
glasses, like so much stuff, hasbecome eligible To track down
the odd $5, $15, $125 in groceryon Amazon All of that is
basically nonsensical.
I tried it, which is really whatthe personal pain was like.
I need to be able to automatethis, and so I spent two hours
(18:09):
going through three years ofAmazon history to pull out $700
of eligible spend and kind ofwent, that was just Amazon that
didn't touch Costco Sam's Clubspend and kind of went, that was
just amazon that didn't touchcostco sam's club, king supers,
all of my other um kind ofgrocery locations, and uh, and
said, yeah, okay, this is abetter way and that's that's
fundamentally what um, whatharvest is working on.
So we both give you the toolsto safely document all of this
(18:33):
paperwork forever and at theclick of a button you can
download it all.
It will be there.
You don't have to worry aboutthe service dying it's not going
to happen, but sure, um.
And then also we have found away to pull through amazon
history, flag everything youspent money on that's hsa
eligible um and store that aswell, store those receipts and
at some point, whether you needit now or a future.
You can kind of literally push abutton and and get the
(18:54):
reimbursement processed.
Um, and we've started withAmazon, but very soon it will be
Sam's Club, costco everywhere,american's shop that keeps an
online record of your groceryshopping.
Sam Maule (19:07):
So we actually did an episode Matt I can't remember
when a few weeks ago, maya wherewe talked about startups, right
and talking about okay, tell meabout the product, what is the
problem you're solving?
You've done a great job, we'vegot that covered.
I think we can check the boxand say we got it.
One of the flip things in myalways talk about is okay, cool,
so what's your business model,what's the revenue model?
(19:29):
So can we go there?
Matt Quinn (19:30):
Sure, sure.
I think it's definitely a bigquestion for us on when we've
written it down.
There's so many points of valuethat we add here and capturing
a slice of that value is alittle tricky.
Some ways that we've seen itdone and have been suggested to
(19:51):
us is OK, why don't you chargeon reimbursement?
And the challenge with that istwo things.
We really don't want toencourage people to reimburse
this money.
We would like to help enablethem to store this kind of
account balance for as long aspossible, and so for us to start
, we're just saying hey, look,you can upload all your
(20:11):
documents, you can store allthis stuff for 15 years, totally
fine.
There's really not enough valuethere for us to go and try and
take a slice.
But I spent two hours trying tofind just my Amazon history.
Right, that was $700.
If I can push a button and thatcan find $700 for me, harvest
is asking okay, if we findanything that is a grocery
(20:31):
expense in the last 12 months,we would love a 3% finder's fee,
and as those items age, I thinkit becomes a 4% finders fee.
So you can push a button andwe'll say hey, we found $1,000
worth of stuff If you don't wantto pay for it.
It's here.
It will just get a little bitmore expensive as you kind of
wait, but if you paid $4, youwill have these expenses in your
(20:53):
account for the rest of yourlife.
You have access to it, you haveall the documentation and
that's definitely where we'restarting.
There's a whole bunch of avenuesthat come off of that and we're
still trying to gauge wherepeople are on data privacy, one
of the things that becomes quiteinteresting when you have
somebody doing this every sixmonths and running to keep this
data.
(21:13):
We get really, really freshunified customer data at the
item level.
So somebody could look at myprofile, for example, and see,
like, okay, well, on Amazon, Ibuy this brand of diapers every
single month, but when I go tothe grocery store, I'm buying
this, and when I go to Sam'sClub, I'm buying this.
(21:35):
There isn't really a servicethat takes all of those three
things together, right, becauseyou could slice one of those
things off and make a wholebunch of assumptions, as me as a
customer.
So there's two parts therewhich is like can we get enough
data and then anonymize it tomake it both comfortable for the
user and also valuable for thebusiness, but that's something
(21:56):
we're exploring.
Still, that works best,obviously, at a critical mass.
No, I get it.
Sam Maule (22:04):
It's kind of like rocket money right, maya, I'll
go out and find all yoursubscriptions, I'll do the work
for you.
So you're a painkiller.
What is the laborious part ofit?
What's the pain you're solving?
It makes sense, right?
So rocket money does it,because it goes out and finds
out all the apps you'resubscribed to or subscriptions
you have, and then cancel themfor you.
It's like and the yin to theyang of that.
(22:26):
This is finding money that youhave spent and is applicable for
this, or saving you and savingtime.
Matt Quinn (22:32):
It's one of the greatest things in the world you
can do is save me time exactly,and I think there's um, one of
I won't say heartbreaking, butone of the like upsetting parts
of this is uh, I mean, I'mhaving my own health care
experience at the moment.
Everything in my experienceabout the healthcare system and
these accounts is like not easy.
(22:53):
It's just not simple, complex,like simple and understandable.
And so, as we've delved furtherinto this area, I meet people
who think that they are the mostfinancially savvy people on the
planet and they don'tunderstand the hsa.
They don't understand how itworks, they don't understand how
they get money out, and so theywill actively spend their
(23:15):
account balance every singleyear because they want that cash
as soon as possible.
Um and uh.
Then, when it comes to the fsa,which is kind of it's like a
little sister which we also workwith, people will actively go
and look for stuff, and it'susually stuff.
They go filter for FSA eligiblestuff, hsa eligible stuff.
They go oh, I'm going to buy anaura ring.
(23:36):
I don't even need to sleeptrack, but I'm just going to buy
it because I know it's eligibleand I can get the cash out.
And that's just reallychallenging to see that someone
would waste an opportunity,right, but they don't
necessarily realize it on theflip side.
So we get to say, hey, youdon't actually need to do that.
We've already found the $2,000you need back today.
Just push a button, pay alittle fee and push a button and
(23:57):
you get to save an enormousamount of cash there.
When I was looking into thespace originally, and you just
search FSA or HSA on Twitter,you can start to see this.
You get people who I think area bit more vanilla with their
money and potentially withcareers get looped into.
Oh, you know, sephora is nowHSA eligible because they've
(24:20):
managed to make all thefoundations one SPF and the
mascara is one SPF.
And so it gets to November.
Someone goes oh, I've got$2,000 in an FSA, I'm just going
to spend it on Sephora andyou're like I could just give
you $2,000 of cash or $1,999 ofcash.
You don't need to waste thismoney in that way.
Maia Bittner (24:42):
Well, that's cool, and not only that.
People are always pitching mefintech startups.
I feel like half of the pitchesI get are saying you know, 50%
of Americans don't have $400 oryou know, and they come up with
then like bad solutions to thatproblem, usually lending.
And so this is kind of asolution to that problem, right,
helping out Americans who havecash flow crunches, but in a
(25:05):
pretty financially advantageousway, which is like great, you've
got this HSA.
The best thing to do is to holdit until retirement.
But if you need cash now forsome kind of an emergency and
you've been tracking youreligible expenses and you've
been buying them with a creditcard and not expensing them to
your HSA, historically you cankind of help people out in that
way.
Sam Maule (25:24):
I mean, it's one of those things.
Right, you're guaranteed acouple of things.
One you're going to pay taxes,right, I mean, we know that.
But the other is and again,this is, this is your uncle Sam,
everybody who's 57 and lookingforward to the horizon You're
going to get sick.
You're going to get sick.
I go to the gym every day, Iwork out and all that.
(25:44):
I know what those costs aregoing to look like.
One, because I grew up with amother who had multiple
sclerosis, so we saw those kindsof bills.
But two, I'm also at the stageof my life where I had to take
care of my father and in-lawsbecause they had aged Right, and
so I.
It's just, those medical costsare coming.
We're all going to get hit byit.
I don't care how good you are.
(26:10):
Arnold Schwarzenegger had aheart attack.
Arnie, come on, the man hashospital bills, just like the
rest of us.
So this is one of those thingsthat earlier you get.
Now I'm going to get off ofthis recording and go yell at my
daughters and say what are youdoing on your HSAs?
Because it makes sense.
It's one of those start early,right, maya?
We talked about this with thekids and the college savings
plans.
This fits right into.
I think we could build achecklist coming out of this
podcast.
Maya, for all right, you're 18.
Cool, here's all the things youshould be looking at when you
(26:33):
start your career.
Matt Quinn (26:35):
It's definitely.
I mean there's also someidealistic parts to it.
I don't think that there'smonetizable value here.
But if you are embracing beingtotally accountable to your
health and making healthydecisions, we would in theory
have the opportunity of lookingat everything you buy at the
(26:55):
grocery store and flagging andsay, hey, you actually probably
could swap this for this.
Or like the science is trendingthat like if you eat that thing
for long enough, you're goingto be in serious trouble in 20
years.
Like if you eat that thing forlong enough, you're going to be
in serious trouble in 20 years.
I think that that's an untestedidea that I would personally
(27:15):
love.
I don't know how the averageAmerican who wants to be left
alone kind of would feel aboutit, but I do know like people
are eating.
I would say I just recentlydiscovered I've been putting red
forth like stuff with red 40 inmy food.
I use that mio, you knowelectrolyte stuff.
I'm doing a bunch of exerciseand I was looking at the
ingredients the other day, beinglike I didn't even realize I'm
(27:36):
drinking this red 40 stuff,which is abhorrent, and I in no
way should anybody been eatingthat.
So it would be.
There's like pretty cool thingsthat we could do there with
some of that data to try and getpeople to be a bit more
accountable there.
Sam Maule (27:51):
The ex-Googler in me looks at this and goes yes, your
personal AI that we're allgoing to have.
That's going to help us makethose financial decisions and
based upon our individualspending history.
If you really want to knowsomebody, there's two things
right Know what their searchhistory is, which is a whole
other item.
And then the second is how doyou spend your money?
Because that's what you value.
(28:11):
That's just reality.
Where do you spend your moneyand where do you spend your time
?
So matt, I mean, that componentof it actually makes sense to
me that that's something youcould grow into.
The more data you're collectingand the farther along you can
do, it's still a value-addedservice it could be so
interesting.
Matt Quinn (28:27):
Right like um, you get I know my, and I've
discussed this before.
There's a little blurry areawhere it's like are you giving
medical advice do?
Is there a?
Is there a line?
You cross there?
But I think for there are.
There are healthier choicesthat people avoid because they
think they're too expensive inthe short term, and I think we
could do some really interestingstuff to say you know what?
(28:48):
I can see you buy the cheapesteggs.
Last year you bought 156 of thecheapest eggs.
If you bought pasture raisedeggs from the place you already
shop at, that's a $20 changeyear over year.
And here's all of the sciencethat would say that this would
be phenomenal for your health,things like that.
They're obviously like-.
Maia Bittner (29:08):
Well, right, because they're trying to save
money, and it's like, actually,you could save money by buying
the more expensive eggs.
If you take the right viewpointon it, I think red dye number
40 is actually illegal in manycountries, including Canada.
I know this because I livequite close to Canada, I spend a
lot of time there and theirfruit loops are not as bright,
live quite close to canada, Ispend a lot of time there and
(29:29):
their fruit loops are not asbright.
Uh, but I think, right, it'slike could you do not medical
advice, but help me eat in waysthat are legal in other
civilized countries yeah, my uh.
Matt Quinn (29:39):
Well, now I have a one month old, so my parents are
coming out this weekend andthey are both, uh, americans,
born, raised here, but I don'tthink they commonly forget what
has happened.
Every time they come out I givethem a little talk.
I'm like, if you keep eatingthe way you think you eat
healthily in England, it's notthe same.
Quaker Oats has fiveingredients in London.
(30:01):
Quaker Oats has 50 in America.
Be careful with what you'regoing to buy here, because it's
not the same stuff.
Sam Maule (30:09):
We're all chemists.
Maia Bittner (30:10):
So one of the things yeah you make me think of
with the eggs.
Right is how expensive it is tobe poor.
Long term, it's cheaper to buythe better eggs because you're
going to be spending less moneyon health insurance.
That's probably true regardlessof whether you're using an HSA
or even a standard healthinsurance plan.
But some people just can'tafford that.
(30:30):
And HSAs in general, this wholeplan about like well, just
cover your health expenses, nowlet the money compound in your
HSA accounts and in thoseinvestments might be out of
reach for some people.
Do you think that this is anadvantage that only applies to
rich people?
Who can it help?
Matt Quinn (30:50):
That's a good question, definitely something
we're cognizant of.
There's like a two-tieredanswer, right?
So if you have a HSA, there's30 million HSA and FSA account
holders in America.
Maia Bittner (31:03):
If, you have a.
Matt Quinn (31:04):
HSA.
Typically you work for a prettybig company, so I don't think
it is your small businesses thatare offering these plans.
It is a Broadcom or a WellsFargo or a Facebook.
So right off the bat, youprobably have a higher than
median income, I would imagine,or you're on the path to do that
(31:25):
, I would imagine, or you're onthe path to do that.
So it definitely sparks adifferent conversation around,
like cost of healthcare andgetting, getting getting access
to some of these things.
It's a less, it's an absolutelylike less than ideal situation.
(31:52):
There's nothing, really nothing,worse than seeing the, the cost
of healthcare and food andeverything to the hardest hit
kind of Americans.
It's not, it's just really notan area I think that we know how
to address in many ways.
But it would be interesting tosee as time goes on, from maybe
I think this well from maybemore of an altruistic standpoint
, but it'd be really interestingto see what parts of harvest we
(32:12):
could repurpose to give averagejoe the same level of
opportunity and reviewing whatthey buy and um, and saving
money and I think the there'sdefinitely another piece here
around, like I've seen peoplewho, uh, who have taken money
out of the hsa's in an emergencyright.
So let's say you, even if you,um, are a bit of a higher income
(32:33):
, you still have emergencyspending.
If we, we have this idea,that's like if we are tracking
all of your out-of-pocketmedical expenses and grocery
bills and we know the hsabalance is fifteen thousand
dollars and you have tenthousand dollars you can
reimburse today, instead ofliquidating that, hurting
yourself on a 20-year timelineaway from investing those funds
and also paying the tax penalty,there's room there to give
(32:56):
someone quite favorable creditterms away from the penalty and
say, okay, we'll give you asix-month loan, worst case
security, we'll reimburse thisamount and take the money back
from you.
So you don't have to incur thattax penalty Penalty is 20%.
So if the six month loaninterest is within that like,
you won't actually have to paythat penalty, and so we don't
(33:19):
feel that that it would bepredatory.
We actually feel like there's alot of value in every party
there, so there's definitely afuture ambition for us party
there.
So there's definitely a futureambition for us.
But right now, tracking thisout-of-pocket HSA amount is
effectively like a ghost assetin many ways, and I think we
could create a lot of comfortfor people who do need a lot
(33:40):
more, who have unpredictablecash flow problems, let's say
but yeah, yeah, the idea isfantastic, fantastic.
Sam Maule (33:47):
It's one that'll be interesting to watch how this
grows.
There's a pun everybody, so, so, matt.
Where's the best place for thepeople that are listening to
understand more about harvestand where y'all are headed?
Matt Quinn (33:59):
sure everything for us is online, so the website is
hsaharvestcom.
Uh, currently we have a winglist, but if you sign up early
you geta little bonus where youcan earn a percentage of
everything harvested fromeverybody you refer and we're
slowly letting people in to testout, test out the product and
move forwards there and it'salso a great link.
Sam Maule (34:18):
I was looking at the site.
Anything you want to know abouthsa's, just go there.
I mean it's documented out.
You can get a degree in uh in h.
So, Matt, thank you so much.
It's a fascinating sector towatch and see where this goes.
Us healthcare everybody justmake your head hurt.
Well, that's it for today'sepisode.
(34:40):
We want to thank you all forlistening.
Please do go out and give us areview and tell your friends
about the podcast.
Review should be five starsalways.
I don't think there's anythingunder five.
Come on, Be good to us.
If you want to reach out to me,give us ideas for a show.
You can find me on Twitter oron LinkedIn.
Maya, how about you?
Maia Bittner (34:58):
I'm also on Twitter at Maya B.
I have open DMs.
Feel free to message me anytime.
And hey, thanks so much forlistening to Artificially
Intelligent.
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