1. Commonwealth of Massachusetts 2015 GIC Flexible Spending Account Program

2. Payroll Coordinator Packets
Employee letter, brochure and poster – please post and distribute
Coordinator letter – reminders for the FSA open enrollment
2014 Participants – must re-enroll online; instructions enclosed.
2015 Enrollment Form – for new hires and new participants. Check for completeness and complete bottom section. Forms due to ASIFlex no later than December 10, 2014.
Claim Form and Physician Statement – also on and
Today’s presentation

3. This video is on the GIC’s website – be sure your employees see this.

4. The GIC has Selected a New Administrator for 2015
ASIFlex
Based in Columbia, MO; 400 Clients Nationwide in 27 states, many public sector clients
Will take over 2014 grace period and 2015 claims processing effective 1/1/2015
Extended Customer Service Hours
8 am to 8 pm Monday through Friday
10 am to 2 pm Saturday
Participant
Toll-Free
Phone
Fax

5. Spending Account (HCSA) Dependent Care Assistance Program (DCAP)
Lower HCSA Minimum Election for 2015
Health Care
Spending Account (HCSA)
Dependent Care Assistance Program (DCAP)
Maximum Election
$2,500*
$5,000
Minimum Election
$250
No Minimum
* This may increase by $50 subject to IRS regulations

6. Administrative Fee Reduced by 30%!
Monthly Participant Fee Reduced to $2.50!
Savings of $1.10 per month
For HCSA only, DCAP only, or both
Charged to participant account on pre-tax basis
Deducted in first pay period of each month
This gives employees who have never enrolled a chance to test it out!

7. What is a Flexible Spending Account (FSA)?
Allows participants to set aside money on a pre-tax basis for certain expenses.
Tax savings help offset rising costs of out-of-pocket health care and day care expenses.

8. How Does a FSA Work? Employee must enroll annually
Pre-tax elections are reduced from participant’s pay checks including pre-tax administrative fee
Participant/Dependent(s) uses their Health Care FSA debit card to pay for out-of-pocket HCSA expenses; funds immediately taken from their account
DCAP participants and non-debit card HCSA expenses processed through claim form
Participants must keep copies of all receipts per IRS regulations

9. Health Care Spending Account (HCSA)
For out-of-pocket health care expenses not paid by insurance – includes dental and vision care
Annual election available January 1
If a participant leaves state service, he/she is eligible for the entire annual election regardless of their contributions. However the employee can only file claims for dates of service prior to the termination date
Participant may be eligible for COBRA
Reminder: when employees leave state service – let them know about COBRA HCSA

10. HCSA Eligible Expenses
Doctors Fees and Expenses
Ambulance
Co-payments
Deductibles for medical or dental
Hospitalization
Laboratory fees
Physicals
Vaccinations and immunizations
Dental Care
Dental bridges
Dental crowns
Implants
Orthodontia
Routine dental cleanings
Treatment, Therapy, and Wellness Programs
Acupuncture by a licensed practitioner
Chiropractors
Hypnosis for treatment of an illness
Massage therapy*
Mental health care
Therapy by licensed therapists
Weight loss programs*
Vision Care
Contact lenses
Eye exams
Eyeglasses
Lasik eye surgery
Prescription sunglasses
*Must be medically necessary, meaning you have a qualified medical diagnosis and a recommended treatment plan from a health care professional. Claims must be filed manually accompanied by a physician's statement (required each year/available on website) or a prescription.

11. HCSA Eligible Expenses (Continued)
Over-The-Counter Supplies
Athletic treatments
Bandages
Blood pressure monitors
Cholesterol meter test kit and supplies
Contact cleaning
Crutches, canes, walkers
Diabetic monitors and supplies
Eye glasses
Eye related equipment
Family planning products
Fertility monitors
First aid kits
Hearing aids and batteries
Insulin test strips, testing materials
and supplies
Medical monitoring and testing devices
Orthopedic and surgical supports
Pregnancy tests
Urological products
Wheelchair and repairs
Note: Over-The-Counter drugs and medicine are only eligible for reimbursement through the FSA if accompanied by a doctor’s prescription.

13. Ineligible HCSA Expenses
Cosmetic services (unless resulting from disease or illness)
Expenses claimed on tax return
Expenses reimbursed by other sources (e.g., insurance)
Fees for exercise or health clubs (unless prescribed by a physician for a medical problem)
Hair transplants
Insurance premiums
Vitamins for general well-being
Weight loss programs for general well-being

14. HCSA Debit Card Easy access to HCSA account funds
Free set of 2 cards to all enrolled participants ($5.00 per additional set of cards)
Use for co-pays, deductibles, co-insurance and other items not covered by insurance and over-the-counter medications
Funds are deducted immediately from your HCSA
No need to file claims
Updates your account balance and transaction history
Participants must retain all receipts – IRS mandate

15. 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.
Expenses must be for a dependent you can claim on your income tax return, who is under age 13, or physically/mentally incapable of caring for him/herself
Your dependent must live in your home at least 8 hours per day
Funds are available as contributions are made
If a participant separates from the plan, they are eligible up to the contribution amount for any dates of services within the plan year
DCAP maximum: $5,000 per household* ($0.00 minimum)
*Household maximum per plan year as per IRS

16. Eligible Dependent Care Assistance Program Expenses
Care for dependent children up to 13th birthday
A 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 care (includes elder care)
Child care at a daycare center, day camp, nursery school or by a private sitter
Before and after-school care (not tuition)
Housekeeper caring for an eligible dependent
Au Pair placement fees and weekly stipend

17. Ineligible Dependent Care Assistance Program Expenses
Education or tuition fees
Late payment fees
Overnight camps
Agency fees for finding a care provider
Sports lessons, field trips, clothing
Mileage reimbursement to/from the care provider

18. Comparison of Post-Tax versus Pre-Tax Savings
With FSA
Without FSA
Annual Income
$50,000
Annual Pre-Tax FSA Contribution
-$2,000
-$0
Annual Taxable Income
=$48,000
=$50,000
Annual Tax Withholdings (approximately 25% of the annual taxable income)
$12,000
$12,500
TOTAL ANNUAL SAVINGS (approximately $250 for every $1,000 withheld in the FSA per year)
$500 $0

19. Multiple Claim Filing Options
ASIFlex Claims
Online
Mention: ASIFlex provides rapid claim processing within 1 to 3 business days.

20. Video – How to File a Claim

21. Multiple Claim Filing Options Reimbursement Options
Upload your scanned receipt online by logging into your FSA account
Take a picture of your receipt with your mobile phone and upload it using an iPhone or Android; or
Print the confirmation page and send in to ASIFlex with a copy of your receipt.
Claims Processing
Claim Forms are online at and
Claims reimbursed within 1-3 business days of receipt

22. Multiple Claim Filing Options (continued)
iPhone/iPad and Android Mobile Applications
Applications can be found via
Apple App Store
Google Android Market
Through the application:
Available balance
Important filing dates
View claims that require a receipt: submit those receipts using the mobile device’s camera!
Text Message and/or Alerts
Receive notifications about the following:
Receipt Reminders
Claim Confirmation
Denial Notifications
Account Statements

23. Help Employees Enroll
Distribute materials to employees including a link to the Kimberly video – the GIC will send to you via
Explain why it’s helpful to the employee and his/her family:
How much do you spend annually on prescription drugs?
Do you purchase eye glasses or contact lenses?
How often do you visit the doctor?
How many dental visits do you anticipate?
What are your health insurance co-payments and deductibles?
Do you have day care, elder care or after school care costs?

24. Election Calculation Assistance
Tax Saving Estimator
Health Care Expense Planning Worksheet
In your coordinator packet

25. “Use It or Lose It” Rule
Participants forfeit money unspent at the end of the plan year
IRS Rule (Section 125 of IRS Code)
Funds cannot be rolled over to the next plan year and cannot be paid out without eligible expenses
Participants must plan carefully when making elections
2 ½ month grace period to spend down balances – expenses through March 15, 2016 for 2015 elections; claims must be submitted no later than April 15, 2016 (otherwise forfeited).

26. Transition to ASIFlex
2014 FSA benefits administered by Benefit Strategies through Monday, December 22, Contact them for 2014 claims:
Benefit Strategies debit card active through Monday, December 22, 2014, if sufficient balance to cover the expense.
Deadline for 2014 paper claims through Benefit Strategies is Friday, December 19, 2014.
No 2014 claims will be processed through the end of the year after these two cutoff dates (December 22 for the debit card and December 19 for paper claims).

27. Remaining Balances from 2014
Beginning January 1, 2015, if employees have remaining 2014 FSA balance:
Submit claims to ASIFlex using the ASIFlex claim form:
Employees who re-enroll in benefits for 2015 can use new ASIFlex debit card for 2014 balances.
2014 balances will be spent down before 2015 election.
Participants in Comptroller’s pre-tax transportation program, continue to use Benefit Strategies Visa debit card (“Benefits Card” and the Benefit Strategies logo are on the card).

28. How Grace Period Claims Processed
If a participant has an available prior plan year account balance and is also participating in the current year plan
Expenses are paid from the prior plan year first for debit card or manual claim submission
Based 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

29. New Hire Benefit Effective Dates
60-day waiting period for HCSA benefit; refer to payroll calendar on next page for effective dates of new hires
No waiting period for DCAP benefit; effective immediately from hire date
Example: Susan Smith hired on 6/15/2015 would have an HCSA effective date of 9/1/2015 and a DCAP effective date of 6/15/2015.

30. Date of employment is from HCSA Coverage begins on
Payroll Calendar
Date of employment is from
HCSA Coverage begins on
Jan 2 – Feb 1
1 – Apr
Feb 2 – Mar 2
1 – May
Mar 3 – Apr 2
1 – Jun
Apr 3 – May 2
1 – Jul
May 3 – Jun 2
1 – Aug
Jun 3 – Jul 3
1 – Sep
Jul 4 – Aug 2
1 – Oct
Aug 3 – Sep 2
1 – Nov
Sep 3 – Oct 2
1 – Dec
Oct 3 – Nov 2
1 – Jan
Nov 3 – Dec 3
1 – Feb
Dec 4 – Jan 1
1 – Mar

31. Qualifying Change in Status
Enroll in either plan, change contribution or terminate election during the Plan Year if have :
Change in legal marital status
Change in number of dependents
Change in employee’s or spouse’s employment status (for example, employee hours increase making him or her eligible for the program, or spouse loses employment affecting enrollment in another FSA program.
Change in work schedule which changes eligibility for the program.
Dependent satisfies or ceases to satisfy eligibility requirements.
Judgment, decree or order pertaining to child or spouse.

32. Coordinator Ongoing Procedure Changes
See the GIC’s website for updated step-by-step procedures:
Fax, don’t mail, to ASIFlex enrollment/change forms for qualifying status changes and new employees
New hires: enrollment form
Status changes: change form

33. Offline Agencies
Contact ASIFlex to set up program: payroll file, funding requirements, and instructions for setting up secure portal for communication.
Five days before each pay date, send FSA Contribution and Change Report to ASIFlex. If a report is not sent all participant accounts for your agency will be placed on hold. See website for report details:
You will receive a Discrepancy Report via secure portal or fax within two business days listing each discrepancy between what the FSA Carrier expected, and what was sent in the FSA Contribution and Change Report. You must resolve these discrepancies.

34. 2015 Payroll Audit Process – All Agencies
Any participant not on each payroll file will immediately have their Health Care FSA debit card and account placed on hold until the issue is resolved
Agency/Division payroll coordinators will be notified via when an account is placed on hold
When issue has been resolved, Health Care FSA debit card will be reactivated and there won’t be a gap in coverage

35. Refunds
Avoid refund requests: enter the correct deduction code(s), deduction amount(s) and end date deduction(s) when entering terminations/leaves of absence.
To request a payroll refund check:
Send the request via to
Include the following information:
Employee Name
Employee ID
Deduction code(s) and amount(s) of refund; e.g. DCAP $50, HCSAF $2.50
Reason for the refund; e.g. terminated state service, deduction taken in error
Name and address for the refund check:  Refund checks will be made payable to the Commonwealth of Massachusetts.  The agency must refund the employee.
The GIC must approve the refund request and will work with ASIFlex to research.

36. Important Dates
Collect all HCSA/DCAP enrollment forms/online confirmation pages (signed and dated) by December 5.
Return all completed paper enrollment forms to ASIFlex by December 10. (Don’t send online re-enrollment confirmation pages)
HR/CMS Agencies and UMASS: Enter both the DCAP and/or HCSA and HCSAF deductions into HR/CMS. The HCSAF fee is for either or both programs – HCSA and DCAP
Review payroll calendar for 2015 to ensure deductions are entered correctly. Both the HCSA/DCAP will be deducted each pay period. HCSAF deductions will be taken the first pay period of each month.
Prevent payroll errors: carefully review the enrollment forms, payroll deductions, codes, beginning and end dates entered into payroll system
Deductions must be entered into the payroll system by December 26, 2014 for the January 2, 2015 payroll including the HCSAF fee

37. Final Reconciliation Before January 1
Final enrollment roster will be sent by ASIFlex to Payroll Coordinators on December 17, 2014.
If there is an employee on the enrollment report that you don’t have an enrollment form or the online enrollment confirmation for, contact that employee to obtain one on file and update the payroll for 2015.
If you have an enrollment form for someone that is not on the enrollment report, notify ASIFlex ASAP.
You will receive report of employees who didn’t re-enroll for 2015 – confirm FSA deductions stopped

38. ASIFlex Account Manager Galen Young FlexGIC@asiflex.com
Payroll Coordinator Help
ASIFlex Account Manager Galen Young

39. Thank you for your help for a successful open enrollment!