FSA - Medical Reimbursement Account

The Health Care Reimbursement Account allows you to pay for your uninsured medical expenses with pre-tax dollars. With this account, you can pay for your out of pocket medical expenses for yourself, your spouse and all of your dependents for medical services that are incurred during your Plan Year. The maximum you may place in this account for the Plan Year is $2,550.

EXAMPLES OF ELIGIBLE HEALTH CARE EXPENSES

FEES/CO-PAYS/DEDUCTIBLES:

  • Acupuncture
  • Prescription Eye glasses/Contact lenses
  • Physician
  • Ambulance hire
  • Psychiatrist
  • Psychologist
  • Anesthetist
  • Hospital
  • Erectile dysfunction medication
  • Chiropractor
  • Laboratory
  • Sterilization Fee
  • Dental Fees
  • Nursing
  • Surgery
  • Diagnostic
  • Obstetrician
  • X-Rays
  • Eye Exams
  • Laser Eye Surgery
  • Wheel Chair

OTHER ELIGIBLE EXPENSES:

  • Prescription drugs
  • Diabetic supplies
  • Artificial limbs & breasts (only if reconstructive)
  • Routine Physicals
  • Birth control pills, patches (e.g. Norplant)
  • Condoms
  • Orthopedic shoes/inserts
  • Dentures
  • Carpal tunnel wrist supports
  • Oxygen
  • Incontinence supplies
  • Physical Therapy
  • Vaccinations & Immunizations
  • Fertility Treatments
  • Elastic hose (medically prescribed)
  • Hearing aids and batteries
  • Contact lens supplies
  • Reading glasses
  • Therapeutic care for drug and alcohol addiction
  • Medical equipment
  • Take-home screening kits (HIV, colon cancer)
  • Pedialyte for dehydration
  • At home pregnancy test kits
  • Mileage, parking and tolls ( you may be reimbursed $.23* a mile plus parking and tolls when medical reasons make it necessary to travel)
  • Tuition fees for medical care (if the college furnishes a breakdown of medical charges)
  • Orthodontic expenses (not for cosmetic purposes)

NOTE: ORTHODONTIC TREATMENT IS REIMBURSED ACCORDING TO YOUR PAYMENT PLAN WITH THE ORTHODONTIST. FOR EXAMPLE: If your payment plan is set up to pay $100 a month for the orthodontic treatment, you can be reimbursed $100 a month for the payments that become due during the Plan Year.

This above list is compiled from IRS publication 502. If you are unsure that your expected medical expense will be eligible under tax code regulations, please call Flexible Benefit Administrators at (757) 340-4567 or (800) 437-FLEX before making your election for the Plan Year. IRS publication 502 can be ordered by calling the IRS at (800) 829-3676.

***Mileage reimbursement rate is based on IRS regulation and subject to change.***

Health Savings Account

An HSA, or health savings account, is a unique tax-advantaged account that you can use to pay for current or future healthcare expenses. When combined with a high-deductible health plan, it offers you savings and tax advantages that a traditional health plan can't duplicate.

An HSA provides several financial benefits:

  • Tax deductible contributions to your savings account
  • Tax free dollars to pay for qualified medical expenses
  • Tax free growth of your investment
  • Keep the savings you don't use
  • Take the plan with you if you change jobs

Other potential advantages include, but are not limited to:

  • Lower insurance premiums
  • Employer Contribution
  • Opportunity to control expenses by being more aware of the true cost of medical treatments
  • Supplement retirement - in your retirement years (after age 65) your HSA can be used for non-medical expenses without a penalty, just taxes

HSA Maximum Annual Contribution

2016

$3,350     Single - one person covered           

$6,750     Family - more than one person on health insurance

2017

$3,400     Single - one person covered

$6,750     Family - more than one person on health insurance

 

Catch-up Provision

  • Age 55 and over by December 31 of tax year
  • $1,000 per year

Limits include any employer contribution

The City will also offer a one-time deposit to the health savings account (HSA) for any current employee that signs up for this coverage.  This deposit will be $800 for the individual coverage and $1,200 for all other plan choices.  This will only apply to any employee that is enrolling in the Lumenos Plan for the first time during enrollment.  This will be made after the accounts have been established for all employees on this plan.

Watch the video below to learn more about the advantages of an HSA and why you need one.

 

FSA - Limited Medical Reimbursement Account

Who should enroll in the Limited FSA Plan?

If you are participating in the Health Savings Account, you must enroll in the Limited FSA Plan if you wish to participate under an FSA Plan for the renewing Plan Year that runs from October 1, 2014 – September 30, 2015. Although you are not required to participate in the Limited FSA, you should do so if you want to enroll in the Health Care Reimbursement Program and make HSA contributions (or want to remain eligible for any discretionary employer contributions to your HSA). The maximum you may place in this account for the Plan Year is $2,500.

What expenses can be claimed under a Limited FSA?

Under the modified FSA, the HealthCare Reimbursement Program will only reimburse you for “medical care” (as defined in the Tax Code) that is dental, vision, or “preventive care.”

Examples of Dental and Vision Expenses

  • Cleanings
  • Fillings
  • Crowns
  • Orthodontia
  • Extractions
  • Dentures
  • Contact Lenses
  • Eye Glasses
  • Eye Exams/Procedures
  • Vision Correction Procedures

What are some ineligible expenses under a Limited FSA?

  • Your co-payments, deductibles and co-insurance payments for any expenses not related to preventive care
  • Cosmetic dental procedures (veneers, teeth whitening service or products)

Are prescriptions and over-the-counter products eligible under a Limited FSA?

Drug costs, including over-the-counter drugs may be reimbursed if they are considered for dental, vision, or preventive care expenses. Drugs or medications will fall within the guidelines when they are taken by a person who has developed risk factors for a disease that has not yet manifested itself or has not been clinically apparent (no symptoms yet developed). The drugs could also be taken to prevent the recurrence of a disease from which a person has recovered.

Examples of preventive care eligible expenses:

  • The treatment of high cholesterol with cholesterol-lowering medications to prevent heart disease or the treatment of recovered heart attack or stroke victims.
  • Drugs or medications used as part of procedures providing preventive care services such as obesity, weight-loss and tobacco cessation programs.
  • Screenings: Cancer, Heart and Vascular diseases, Infectious diseases, Mental Health conditions, Substance Abuse, Metabolic, Nutritional, and Endocrine conditions, Musculoskeletal disorders, Obstetric and Gynecologic conditions, Pediatric conditions and Vision and Hearing disorders.

Helpful hints on the administration of a Limited FSA

Diagnosis information to determine whether a particular medication (that may also be used to treat an existing condition) is being prescribed for preventive purposes may be requested to determine whether a drug or medication is being used to prevent or treat an illness.

Letters of medical necessity for Limited FSAs must specifically state that the medication is being used to prevent an illness. In example #1 above, a letter could state that “Mary needs to take Lipitor to prevent heart disease due to the fact that she has a family history of heart disease.”

A letter of medical necessity for prevention of an illness will also be required for any OTC drug.

If you have any additional questions regarding what is or isn’t covered under a Limited FSA Plan, please contact Flexible Benefit Administrators, Inc. at (800) 437-3539 or FlexDivision@flex-admin.com.

Important Information

Flexible Spending Accounts (FSAs) allow you to pay certain healthcare and dependent care expenses with pre-tax money. (The key to the Flexible Benefit Plan is that your eligible expenses are paid for with Tax Free Dollars.) You will not pay any federal, state or social security taxes on funds placed in the Plan. You will save between, approximately, $27.65 and $37.65 on every $100 you place in the Plan. The amount of your savings will depend on your federal tax bracket.  Please click the following link for a high-level overview of Salem's FSA.

 FSA Overview

 Flexible Benefit Plan Employee Guide

 Summary Plan Description - City

The following link is a summary of common expenses for Health Care Flexible Spending Accounts (FSAs), Dependent Care Flexible Spending Accounts (FSAs), Health Reimbursement Arrangements (HRAs) and Health Savings Accounts (HSAs). Some plans restrict the eligible expenses, such as Limited Scope FSAs or Deductible Only HRAs. Please refer to your employer's Summary Plan Description (SPD) for your specific plan details.

 Eligible Expense Listing

If you are participating in the Health Savings Account, you must enroll in the Limited FSA Plan if you wish to participate under an FSA Plan for the renewing Plan Year that runs from October 1, 2015 – September 30, 2016. Although you are not required to participate in the Limited FSA, you should do so if you want to enroll in the Health Care Reimbursement Program and make HSA contributions (or want to remain eligible for any discretionary employer contributions to your HSA).

 Limited Flexible Spending Account

Flexible Benefits Administrators is partnered with FSA Store, the only e-commerce site exclusively stocked with FSA eligible products, to help you spend down and manage your FSA. FSA Store and Flexible Benefits Administrators work together to eliminate the guesswork behind what is reimbursable by an FSA and HSA.

 FSA Store Coupon

FSA Store