• Can I use this account to pay for my spouses deductibles, copayments or other qualified expenses?
  
• Can I use this account to pay for my dependents’ eligible expenses, even if they are covered under a different health plan or I have waived medical coverage for them?
• Where can I use my Prepaid Benefits Card?
• Are there places the Prepaid Benefits Card won't be accepted?
• How will the Card work in participating discount stores and supermarkets starting January 1, 2008?
• Can I use my Prepaid Benefits Card for prescriptions ordered prior to activation of the card?
• Can I use the Prepaid Benefits Card if I receive a statement with a Patient Due Balance for a medical service?
  

• How do I enroll in an FSA?
  
• When can I enroll in an FSA?

Questions on Health Care Flexible Spending Accounts

A Health Care Flexible Spending Account, also called a Health Care "FSA,” is like a personal bank account in which you can set aside an amount of money on a pre-tax basis to cover qualified health care expenses that are not covered by your health plan.

You contribute tan FSA through payroll deductions. Your deductions are made on a pre-tax basis, which means before income taxes, FICA (Social Security). This lowers the amount of taxes you pay.

Basically, if you want to save money on your out-of-pocket health care expenses you should seriously consider participating in an FSA. Since your contributions are made on a pre-tax basis your taxable income is reduced by the amount you contribute, and that lowers the amount of taxes you pay. For example, an individual in the 28% federal income tax bracket who pays $2,000 in qualified medical expenses out of an FSA would save $560 in taxes!

Of course, using the Prepaid Benefits Card makes using an FSA simple and automatic!

The IRS defines qualified health care expenses as expenses you or your dependents incur for the diagnosis, cure, treatment or prevention of diseases, conditions or ailments. Most cosmetic surgeries, unless they are for medical reasons, are excluded.

Please see the IRS website to see the details of what expenses are eligible to be reimbursed.

Examples of qualified out-of-pocket health care expenses that are not covered by your benefit plan but are able to be paid for with an FSA include:

FSAs can also be used for qualified health care expenses that are covered by your benefit plan, but that you choose not to submit to your plan.

You can use the Prepaid Benefits Card for all these – and more – thereby stretching your health care dollar and making it easy to do so!

Be sure to review your current benefit plan or contact your Plan Administrator for a complete list of eligible expenses.

Examples Include:

Please go to the IRS web site for a complete list. Always check your employer's benefit plan materials as well.

Yes, but only under certain circumstances. The IRS regulations allow you to change your election within thirty days of a change in "family status." Family status changes include marriage, divorce, death of spouse or child, birth or adoption of child, and termination of employment of spouse. Always check your employer's benefit plan materials regarding changes.

In 2006, the IRS began allowing employers to extend the period for a plan year's purchases up to 2 1/2 months after the plan year. However, employers can choose whether or not tallow this additional grace period. Check with your employer or Plan Administrator to determine a) if they are allowing the grace period for purchases and b) if you can use your Prepaid Benefits Card for these purchases or if you must submit a manual claim. If your employer does not allow the grace period, you must use all your FSA contributions before the end of the plan year or you will forfeit any money left in your account.

You will have time after the end of the plan year to file claims for qualified expenses that you incurred on or before the end of the plan year. The deadline for submitting claims is usually three months following the end of the plan year. Always check your employer's benefit plan materials or call your Plan Administrator.

In 2006, the IRS began allowing employers to extend the period for a plan year's purchases up to 2 1/2 months after the plan year. However, employers can choose whether or not tallow this additional grace period. Check with your employer or Plan Administrator to determine a) if they are allowing the grace period for purchases and b) if you can use your Prepaid Benefits Card for these purchases or if you must submit a manual claim. If your employer does not allow the grace period, you must use all your FSA contributions before the end of the plan year or you will forfeit any money left in your account.

Yes. You don't need to itemize deductions to take advantage of this benefit.

No. You cannot claim a tax deduction for the same expenses that are reimbursed tax-free through your health care FSA. But, keep in mind only health care expenses that are more than 7 1/2% of your adjusted gross income can be deducted from your income taxes, and most people do not have enough expenses to take the deduction. So, in a sense, an FSA eliminates the 71/2% threshold.

Yes. This constitutes a family status change. Always check your employer's benefit plan materials.

If, you don't use the Prepaid Benefits Card, then contact your Plan Administrator at the phone number on the back of your Card to obtain a claim form.

The maximum is set by your employer and is identified in your employer's enrollment materials





Using FSAs with the Prepaid Benefits Card

Yes, an FSA can be used to pay for your spouse's eligible expenses. You receive two Prepaid Benefits Cards so your spouse or dependent can sign and use one of them.

Yes, you can use your account for eligible expenses for anyone who qualifies as your dependent on your tax return. A reminder: You receive two Prepaid Benefits Cards so your spouse or dependent can sign and use one of them. You can also purchase additional Cards for a small fee to suit your unique dependent needs.

Your Prepaid Benefits Card can be used to pay for eligible goods and services at providers/merchants that offer these goods or services and accept MasterCard® debit cards or Visa® debit cards. Be sure to review your current benefit plan or contact your Plan Administrator for a complete list of eligible expenses.

Starting on January 1, 2008, recent IRS regulations allow you to use your Card in participating pharmacies, discount stores and supermarkets that can identify FSA-eligible items at checkout. You can find out which stores are participating by clicking this link for a PDF document, visiting the website on the back of the Card, or consulting your Plan Administrator. As of January 1, 2008, participants cannot use their Cards at discount stores, department stores, and supermarkets that do not participate, even if you have used your Card at these stores prior to January 1, 2008. The Card transaction may be declined. You can continue to use your Card at freestanding pharmacies and health care providers, such as hospitals, doctors, dentists, etc.

Yes. Your card will not be accepted at locations that do not offer the eligible goods and services, such as hardware stores, restaurants, bookstores, gas stations and home improvement stores.

For FSAs and HRAs, as of January 1, 2008, cards will not be accepted at discount stores, department stores, and supermarkets that cannot identify FSA-eligible items at checkout.

No. Your Card must be activated prior to the order or purchase date of your prescriptions. You need to wait 1 business day after activating your card to purchase prescriptions at your pharmacy with the Card. For example, if the Card is activated on Tuesday, a prescription can be ordered and picked up on Wednesday.

Yes. As long as you have money in your account for the balance due and the provider accepts MasterCard® debit cards or Visa® debit cards, simply write the Card number on your statement and send it back to the provider. Enrolling in FSA.

Enrolling in FSA

Just complete the Enrollment Form provided by your employer and indicate the amount you want deducted from each paycheck.

You can enroll in the FSA during your employer's annual open enrollment or during the plan year, if you experience a family status change. But remember, if you are eligible for the FSA during open enrollment and you choose not to participate, you will not be eligible to participate in the FSA until the next open enrollment unless you have a family status change. Always check your employer's benefit plan materials.