Presentation is loading. Please wait.

Presentation is loading. Please wait.

Personal Risk Services Flexible Spending Accounts __________________________________________ Union College September 6, 2005.

Similar presentations


Presentation on theme: "Personal Risk Services Flexible Spending Accounts __________________________________________ Union College September 6, 2005."— Presentation transcript:

1 Personal Risk Services Flexible Spending Accounts __________________________________________ Union College September 6, 2005

2 A Closer Look At Flexible Spending Accounts (FSA’s)

3 What is an FSA? Flexible Spending Account Allows employees to set aside pre-tax dollars to pay for medical and dependent care expenses. Gives participating employees and employers a tax break

4 How does it work? Employee decides how much salary to set aside for either un-reimbursed medical or dependent care expenses. Medical and dependent care are two separate elections. The amount is deducted from the paycheck. When out-of-pocket expenses have been paid, a reimbursement is made.

5 Un-reimbursed Medical Expenses: Office visit co-pays Co-insurance/deductibles Prescriptions Employer sets maximum to withhold Advantages of participating In an FSA

6 Dependent Care Expenses: Day care and after care for a child under the age of 13 Care for a disabled spouse or dependent incapable of caring for himself. Summer camp (day or overnight) Federal limit of $5,000 Advantages of participating In an FSA

7 Estimation Error – An employee may over or underestimate their expenses for the year. “Use it or Lose It Rule” – Under regulations issued two decades ago, employees forfeited any unused balances their FSA accounts at the end of a plan year. However, this rule has been eased effective May 18, The new regulation allows a 2 ½ month (75 days) grace period at the end of a plan year …extending the time frame for an employee to use money left over at June 30. Irrevocable Election Rule - which prohibits modification to an election during the plan year unless there is a qualifying event in status. Any Disadvantages of participating In an FSA?

8 Examples of Ineligible Expenses (Section 105) Un-reimbursed Medical: Weight loss programs Health Club fees…swimming lessons Dancing lessons Insurance premiums Dependent care: Cost of food, clothing and tuition Cost of babysitting fees by local teenage Cost of transportation to place where dependent care is given

9 Effective July 1, 2005 The FSA allows OTC’s (over-the-counter medicines & products)

10 Examples of acceptable OTC’s Aspirin/Tylenol Contact solution Ace bandages Pepcid AC Cold medications (children/adult)

11 Examples of non-acceptable OTC’s Deodorant Shampoo Toothpaste/toothbrush Make-up Soaps & lotions

12 How are FSA claims paid? If there is a medical, dental, or vision claim, the ARM claims system will automatically pay to you any co-pay or co-insurance amounts. This is done in a weekly “sweep”. Checks are run bi-weekly. If the claims are co-pays for Rx expense or an OTC, a claim form with receipt must be submitted for reimbursement.

13 Claim Forms A claim form is only required if: - the provider is unable to bill ARM directly - the expense is for Rx - the expense is for OTC items Forms can be obtained from our website at or from your HR dept.

14 Thank you!


Download ppt "Personal Risk Services Flexible Spending Accounts __________________________________________ Union College September 6, 2005."

Similar presentations


Ads by Google