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Flexible Spending Account FAQs

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What is a Flexible Spending Account (FSA)?

FSAs are pre-tax accounts allowed under the IRS code that allow you to pay for out-of-pocket qualified health care, dental, vision and dependent care expenses with pre-tax dollars. You elect the dollar amount you want to contribute and the money is deducted in equal installments from your paychecks before taxes are withheld. You will be reimbursed once you show proof that the service was received and that it was for a qualified expense. Participants in the plan will save approximately 30% in taxes on out of pocket expenses.
In addition to the tax savings, you have the benefit of having access to your entire election amount as soon as the plan year begins. It is like receiving an advance payment to pay for your expenses, meaning if you incur an expense early in the plan year, you can use up to your entire election amount to pay your bill. The money will be deducted from your paycheck over the course of the entire year, easing your financial burden.

What expenses qualify under the Health Care FSA (HCFSA)?

Some common qualified expenses include health insurance deductibles, co-pays, co-insurance, dental expenses, vision expenses and prescription drugs.
See an expanded list.

What expenses do not qualify under the Health Care FSA (HCFSA)?

Examples of ineligible expenses include cosmetic surgery, teeth whitening, vitamins and supplements for general health purposes.

What is a Letter of Medical Necessity?

If your care provider believes a service or a product that would normally be considered “ineligible” is medically necessary and is for use beyond general health purposes, they can complete and sign a “Letter of Medical Necessity” in order for that expense to be considered for reimbursement. The Letter must be submitted at the time of claims submission. If you have questions on the eligibility of a service or product, please contact our Customer Service Department.
Letter of Medical Necessity

Can I submit qualified expenses incurred by my spouse and dependents?

Yes, qualified expenses for your spouse and dependents are eligible for reimbursement as well as expenses for your children up to age 26.

If I still have a balance on a medical bill from last year can I use this year’s FSA funds to pay for it?

No, the FSA can only reimburse for expenses that have been incurred, meaning having a date of service, during the current plan year.

What expenses qualify under the Dependent Care FSA (DCFSA)?

The Dependent Care FSA is used for expenses incurred for the care of children under the age of 13 and for certain dependent adult care expenses. You (and your spouse, if married) must work or attend school full time in order for the expenses to qualify.

With dependent care expenses, you can be reimbursed up to the amount that has already been deducted from your paycheck. Reimbursements cannot be made for future dates of service.

When using the Dependent Care FSA, you will need to file Form 2441 with your income tax returns and you cannot apply the Federal Tax Credit for dependent care expenses.

Can I use funds from my Dependent Care FSA (DCFSA) to pay for medical expenses?

No, the HCFSA and DCFSA are separate accounts. When you elect an amount at the beginning of each plan year, you must define the amount of expense for both the Dependent Care FSA and the Health Care FSA. You can contribute to both accounts, but they are not interchangeable.

How do I enroll in a Flexible Spending Account?

Each year your employer will have an open enrollment period and you will have the option to elect or waive participation. You will be provided with information on the features and benefits of your plan and the open enrollment deadline. During that time you will be given the opportunity to determine your election amounts for the plan year.

How much money should I contribute to a Flexible Spending Account?

When determining an election amount, you should plan conservatively so that your election does not exceed your expenses. Consider what known expenses you will have for the plan year such as health care, prescriptions, dental expenses and vision expenses.

Can I change my election or stop contributing during the year if I have elected more than I need?

Generally no. It’s important to plan carefully so that your election amount does not exceed your expenses. You are not allowed to change your election during the plan year except in limited circumstances such as marriage, divorce, birth, death, etc.

What if I have money left in my account at the end of the year?

Plan conservatively as expenses need to be incurred during the plan year. Unused funds may be subject to the use-or–lose provision, depending on your employer’s plan design. Very few people leave money in the plan because they only set aside dollars for known expenses such as health care, prescription drugs, vision expenses, dental cleanings, etc.

What is FSA Carry-over and how do I know if that is a part of my plan?

If the carry-over feature is a part of your employer’s plan, you can carry-over up to $500 of remaining funds from one plan year into the next, thereby eliminating part of the use-or-lose provision. The carry-over feature applies to the Health Care FSA (HCFSA) and Limited Purpose FSA (LPFSA).
If you are not sure if this feature is a part of your HCFSA or LPFSA, check with your Human Resources department or employer’s benefits representative.

What is the grace period and how do I know if that is a part of my plan?

The grace period is a 2 ½ month extension after your plan year ends when you can incur expenses in order to spend down any money left in your account.
If you are not sure if this feature is a part of your HCFSA or LPFSA, check with your Human Resources department or employer’s benefits representative.

How do I file a claim for reimbursement?

Claims and supporting documentation can be submitted by the following methods:
• Online
• Mobile phone app
• Fax
• Mail
See our claims filing instructions/forms. >

How and when do I receive my reimbursements?

Reimbursements will be issued to you either by check or direct deposit, depending on the design of your plan. Your employer determines a reimbursement schedule and will provide that information to you during open enrollment.

What supporting documentation needs to be submitted with my Health Care FSA claim?

Please only submit copies of documentation and keep the originals for your records. Explanation of Benefits (EOBs) from your health, dental and/or vision insurance carriers are the best form of documentation as they contain all of the needed information. If an EOB is not available, documentation must include the following:
• Date of service (this is different from the statement or transaction date)
• Patient Name
• Provider of Service
• Type of service or explanation of service
• Your out-of-pocket expense (after insurance has paid, if applicable)

What is a run-out period?

The run-out period is the period of time that you have after the end of the plan year to submit claims for expenses incurred during the plan year.

What happens to my funds if I leave my employer?

If you leave your employer and there is money left in your account, you have a termination run-out period to submit claims for expenses incurred prior to your termination date. You may be able to elect COBRA to continue your plan coverage through the end of the plan year. If you do not elect COBRA and there is money left in your account, the money stays with your employer. Please check with your Human Resources department to see if your plan is subject to COBRA.

I have a Health Reimbursement Arrangement (HRA), can I still contribute to a Health Care FSA?

Yes, you are allowed to be in both plans, however, you cannot be reimbursed from both plans for the same expense. The Health Care FSA can reimburse your out-of-pocket expenses that are not covered by another plan.

I have an HSA. Can I still contribute to a Health Care FSA?

Yes, you are allowed to be in both plans, however, if you have a HSA, you would enroll in and contribute to a Limited Purpose FSA (LPFSA). You are not allowed to contribute to a general purpose Health Care FSA (HCFSA).

What is a Limited Purpose Flexible Spending Account (LPFSA)?

It is a Flexible Spending Account you can enroll in when you have a Health Savings Account. It allows you to be reimbursed tax-free for dental and vision expenses.

What is the Premium Reimbursement Account (PRA)?

Some plans offer this feature as part of their FSA. If this feature is a part of your plan, premiums for individual dental and vision policies qualify for reimbursement under the plan. This only applies to premiums for individual policies that you purchase if group coverage is not offered through your employer.
(Premiums for group health/dental/vision insurance plans offered through your employer are automatically deducted pre-tax from your paycheck and are not a part of the Premium Reimbursement Account.)

How can I view my account information?

Once you are enrolled in the FSA, you have access to your account information through the DBS online account viewing system known as A.S.A.P.®, which allows you to securely view your claim, balance and reimbursement information.

 

Review eligible expense lists for the Health Care FSA.

Most Commonly Used Eligible Expenses

  • Health insurance deductible
  • Co-pays and co-insurance for medical expenses
  • Dental insurance deductible
  • Dental expenses such as exams, cleanings, fillings, caps, crowns, bridges, x-rays, etc.
  • Orthodontia
  • Vision expenses such as exams, glasses, frames, contact lenses, supplies or Lasik surgery
  • Hearing aids (including batteries)
  • Routine exams/physicals/mammograms
  • Prescription drugs
  • Over-the-counter (OTC) drugs (by prescription—must have a prescription number assigned to it) such as allergy and anti-inflammatory drugs, cold and flu medications, muscle relaxants, pain relievers, cough suppressants and acid reflux medications

Additional FSA Eligible Expenses

  • Acupuncture
  • Alcoholism treatment
  • Ambulance service fee
  • AODA Assessment
  • Artificial limbs
  • Bandages
  • Braces
  • Birth control pills and other contraceptive devices
  • Braille—books and magazines
  • Breast pump and supplies
  • Car controls for the disabled
  • Care for mentally handicapped child
  • Chiropractic expense
  • Co-insurance amounts you pay
  • Contact lenses
  • Contact lens solutions and enzyme cleaners
  • Cost and repair of special telephone equipment for the hearing-impaired
  • Cost of medically necessary operations and related treatments
  • Crutches
  • Dental fees such as X-rays, cleanings, exams or crowns
  • Dentures
  • Diabetic supplies
  • Diagnostic fees
  • Disposable contact lenses
  • Eye examinations
  • Eyeglasses
  • Fee for in-home practical nurse
  • Hearing aid devices and batteries
  • Hospital services
  • In-patient treatment expense for drug and alcohol addiction
  • Insulin
  • Kera Vision Intacs surgery
  • Laboratory fees as prescribed by a physician
  • LASIK surgery
  • Mammograms
  • Medical deductibles
  • Medical services
  • Medical supplies (deemed medically necessary)
  • Mentally handicapped person’s cost for special home nursing services for in-home care (including nurses’ meals and Social Security tax)
  • Mileage for medical care
  • Obstetrical expenses
  • Organ donor transplant medical expense payments for surgical, hospital, laboratory and transportation expenses
  • Orthopedic inserts
  • Osteopath fees
  • Oxygen and medically necessary oxygen equipment
  • Physician fees
  • Prescription drugs
  • Psychiatric care
  • Psychologist fees
  • Radial keratotomy
  • Routine physicals
  • Service animal and its upkeep
  • Smoking cessation programs (by prescription only)
  • Special education for the blind
  • Special plumbing for the handicapped
  • Special school for mentally impaired or physically disabled person
  • Surgical fees
  • Television audio display equipment for the hearing-impaired
  • Therapy treatments for medically necessary reasons
  • Transportation expenses primarily for and essential to rendering special medical services as prescribed by a physician
  • Vitamins and Nutritional Supplements (with pre-approved letter of medical necessity from physician)
  • Weight Loss Program Fees (with pre-approved letter of medical necessity from physician)
  • Wheelchair
  • X-rays

Expenses NOT Eligible for Reimbursement

  • Expenses reimbursed by a Health Reimbursement Arrangement (HRA)
  • Surgery for cosmetic reasons
  • Medical supplies that are not medically necessary
  • Teeth bleaching/bonding/whitening
  • Health club membership dues
  • Over-the-counter vitamins and other dietary supplements for general health purposes
  • Cosmetic drugs
  • Marriage counseling
  • Group insurance premiums deducted from your paycheck
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