Presentation on theme: "Commonwealth of Massachusetts"— Presentation transcript:
1 Commonwealth of Massachusetts GIC Flexible Spending Account Program
2 Agenda Welcome & Introductions Payroll Coordinator Packets Flexible Spending Account AdministrationHow You Can HelpHow Benefit Strategies Can Help YouQuestions / Wrap-up
3 What is a Flexible Spending Account (FSA)? A Flexible Spending Account (FSA) is an employee benefit program that allows participants to set aside money on a pretax basis for certain kinds of expenses. A FSA provides tax savings to offset the rising cost of health and day care expenses.
4 Helping Employees Effectively Enroll Assist employees to understand and maximize the financial and tax benefits provided by the planExplain that employees should be aware of their health care costs:How much do we spend a year on prescription drugs?How often do we visit the doctor?How many dental visits do we need this year?What are my health insurance co-payments and deductibles?Teach employees to better manage their health careUnderstanding what is and isn’t considered dependent care eligible and when it can and cannot be used.
5 How Does the FSA Work? Employee elects to participate and enroll Pre-tax premiums (annual election divided by number of pay periods) are reduced from employee pay checksEnrollee/Dependent incurs an eligible expenseEnrollee completes a claim form or files a claim onlineBenefit Strategies verifies claim and sends reimbursement to participant via check or direct deposit, orParticipant can use their FlexExpress card for health care expenses and retain receipts for substantiation
6 Types of FSAs Health Care Spending Account (HCSA) For eligible healthcare expenses not paid by insuranceAnnual election is available the first day of the plan yearIf a participant separates from the plan, they are eligible for the entire annual election regardless of their contributions, however they can only file for dates of service prior to the termination date (participant may choose to continue the plan through COBRA)Account maximum: $5,000 per participant per year ($500 minimum)No IRS mandated household maximum
7 Types of FSAs (continued) Dependent Care Assistance Program (DCAP)For eligible dependent care expenses that allow the employee (or the employee and their spouse, if married) to work or look for work, or that allows the spouse to attend school full time.Funds are available as contributions are madeIf a participant separates from the plan, they are eligible up to the contribution amount for any dates of services within the plan yearDCAP maximum: $5,000 per household*, ($0.00 minimum)*Household maximum per plan year as per IRS
8 Eligible Healthcare Expenses Eligible healthcare expenses incurred by the participant and/or dependents include:AcupunctureChildbirth classesChiropractic careCo-payments, co-insurance and deductibles (but not insurance premiums)Expenses that exceed medical, dental, vision plan limits (dollar or visitmaximums, out-of-network providers)
10 Ineligible Healthcare Expenses Cosmetic services (unless resulting from disease or illness)Expenses claimed on tax returnExpenses reimbursed by other sources (insurance)Fees for exercise or health clubs (unless prescribed by a physician for a medical problem)Hair transplantsInsurance premiumsVitaminsWeight loss programs for general well-being
11 Dual Use OTC Items Acceptable OTC (Can use debit card) Dual Use OTC : Dr.’s note required, Debit Card Will not workBandagesAllergy and Sinus medicineBlood Pressure MonitorsAntacids and Digestive AidsDenturesAsprin and other pain relieversEye GlassesCold and Flu MedicineFirst Aid KitCough Drops/syrups and LozengesHearing Aids (also batteries)Ear dropsCrutches, Canes, WalkersHerbal or Homeopathic medicinePregnancy TestsLaxativesMedical EquipmentSleep aids
12 Eligible Dependent Care Assistance Program Expenses Care for dependent children up to 13th birthdayA person of any age who can be claimed as a dependent on federal income tax return and who is mentally or physically incapable of self careChild care at a daycare center, day camp, nursery school or by a private sitterLate pick-up feesBefore and after-school care (not tuition)Housekeeper caring for an eligible dependentAu Pair placement fees and weekly stipend
13 Ineligible Dependent Care Assistance Program Expenses Education or tuition feesLate payment feesOvernight camps (in general)Agency fees for finding a care providerSports lessons, field trips, clothingMileage reimbursement to/from the care provider
14 Comparison of After-Tax versus Pre-Tax Savings With FSAWithout FSAAnnual Pay$50,000Pre-Tax FSA Contribution$2,000$0Taxable Income$48,000Federal Income & Social Security Taxes$11,842$12,495Post-tax Dollars Spent On Eligible ExpensesSpendable Income$36,158$35,505TOTAL SAVINGS$653
15 “Use It or Lose It” RuleParticipants forfeit money unspent at the end of the plan yearIRS Rule (Section 125 of IRS Code)Funds cannot be rolled over to the next plan year and cannot be paid out without eligible expensesParticipants must plan carefully when making electionsHealthcare and Dependent Care Accounts are eligible for a 2 ½ month extension to spend down balances
16 Grace Period for Healthcare Expenses Participants have from January 1, 2012 to March 15, 2013 to incur eligible Healthcare and Dependent Care expenses14 ½ months to spend annual allotmentAll contributions not spent on eligible expenses by March 15th will be forfeitedParticipants must file claims by April 15th following the end of the plan year
17 How Grace Period Claims Are Paid If a participant has an available prior plan year account balance and is also participating in the current year planExpenses are paid from the prior plan year first for debit card or manual claim submissionBased on what claim/debit card transaction is recorded first (not what the earliest Date of Service is)Not applicable to participants with a $0 prior plan year account balance or if participant did not have a prior plan year account
18 How to Use Your Funds! Health Care Spending Account Use the FlexExpress debit card where acceptedFile a claim and upload receipts online!Complete a healthcare reimbursement claim formAttach appropriate documentationAn explanation of benefits (EOB ) or itemized bill is required for medical, dental and vision expensesDependent Care Assistance ProgramComplete a dependent care reimbursement claim form (cannot use debit card for DCA)Attach a receipt or bill from the provider, orHave the provider sign the affidavit section of the claim form (Canceled checks are not acceptable), mail, upload or fax claims and receipts to Benefit Strategies for reimbursement.
19 FlexExpress Debit Card Easy access to healthcare account fundsFree to all enrolled participants ($5.00 per additional card)Use for co-pays, deductibles, co-insurance and other items not covered by insurance and over-the-counter medicationsFunds are deducted immediately from your FSANo need to file claimsUpdates your account balance and transaction historyParticipants must retain all receipts – IRS mandate
20 Participant Online Services Track Account balances atGIC has their own FSA page (click on the GIC icon in lower right hand side of home page)Participant will need to log on using assigned username and passwordSign up for Direct Deposit to receive reimbursements directly to your bank accountInclude address on claim forms and receive a monthly statement of accountRe-enrollment for current participants at login above
21 Reimbursement Forms Available online at www.benstrat.com, or By telephone at FLEXGIC ( )Claims can be faxed to orMailed to:Benefit Strategies, LLC PO Box Manchester, NHed to:
22 New! Technology Enhancements Receipt UploadNow upload receipts after submitting a claim online!Once the receipt is uploaded someone from Benefit Strategies will substantiate those claims online, there is no need to send in a claim form or confirmationUsing this new feature will not only save time and money but will also give the convenience of managing your account on your own termsDetailed instructions can be found on our websiteText Message AlertsText Messaging is becoming even more mainstream!76% of US adults have mobile phones67% use text messagingYou can receive notifications about the following:Mobile Receipt RemindersMobile Claim ConfirmationMobile DenialSimply login into your account to opt in and out of the text message communications at any time!
23 New! Technology Enhancements (continued) iPhone and Android Mobile ApplicationsSmartphone adoption is growing rapidly47% increase in Smartphone sales in 2010 vs. 2009A predicted 50% of US mobile users will have smart phones 2011Applications are available viaConsumer PortalApple App StoreGoogle Android MarketThrough the application the following information is accessibleAvailable balanceView account activityFinal service date (final date to incur claims)Final filing date (final date to submit claims)Convenient customer service contact informationDetailed instructions can be found on our website
24 How You Can Help OPEN ENROLLMENT FOR 2012 GIC PRE-TAX BENEFITS OCTOBER 3rd – NOVEMBER 18th, 2011Assist participants on the advantages of being enrolled in an FSA:Display the poster and encourage employees sign up or call us with questionsSend reminder s to employees regarding open enrollmentPhotocopy and distribute the employee letterForward GIC s about open enrollment to your employeesCall Benefit Strategies if you need more information, handouts or have any additional questions
25 Working with Benefit Strategies All paper enrollment forms must be sent to BSL no later than 12/2Enrollment reports for each division will be sent by BSL to the division’s POC by 12/16If there is an employee on the report that the POC doesn’t have an enrollment form for, the POC must work with that employee to get one on file and update the payroll for 2012Please notify BSL ASAP if the enrollment report is missing a participant that you have an enrollment form for and they will be added
26 How Benefit Strategies Can Help YOU! Existing participants in 2011 can RE-ENROLL on line during Open Enrollment between October 3rd and November 18th, Simply follow the instructions that appear when you log into your account.New participants or first-time enrollees must complete a paper enrollment form and turn it in to their HR department. A link to the form is on the GIC home page onBenefit Strategies will receive payroll information from all agencies to assist in identifying a qualifying eventAn error report will go the agency’s Payroll Coordinator via if an exception is discovered for confirmation of whether it is a “payroll correction” or a true “qualifying event”Benefit Strategies will send quarterly enrollment reports to PC to confirm employee deductions are on track to meet yearly goal amounts.
27 How Benefit Strategies Can Help YOU! Fast, friendly customer service and administrative support!1.877.FLEXGIC orDedicated Account Specialists:Dave Willey /Jasmine Shamer /