Health Care Spending Account (HCRA) Questions & Answers

What is an eligible expense under the health care expense account?

An "eligible expense" means any item for which you could have claimed a medical expense deduction on an itemized federal income tax return (without regard to any threshold limitation) for which you have not otherwise been reimbursed from insurance, or any other source. Premiums for accident or health coverage under any other plan are not eligible expenses. Also, premiums for long-term care services are not eligible. You are encouraged to consult your personal tax advisor or IRS publication 17 "Your Federal Income Tax" for further guidance as to what is or is not an eligible expense if you have any doubts.

Can I use my account to pay for my spouse's deductibles, copayments, or other out-of-pocket medical expenses?

Yes. Your health care spending account can be used to cover expenses incurred by you, your spouse, and your dependents (as defined in Code 152). However, health insurance premiums may not be reimbursed through your health care account. Expenses for a domestic partner and their dependents do not qualify.

How are claims for orthodontia expenses reimbursed?

Many long-term medical treatment programs, such as orthodontia, can span several plan years, which affects the process of reimbursement. The standard procedure for refunding eligible orthodontia expenses is to reimburse these claims according to the financial contract/agreement you have with your orthodontist and/or insurance company, which itemizes the expenses incurred during each plan year.

What happens if I incurred expenses at the end of plan year and I don't submit a claim by the end of the plan year?

There is a run-out period of 90 days into the new plan year. At the end of that run-out period, any money in your account will be forfeited. Expenses must be incurred prior to the end of the plan year.

Would I benefit from electing a Health Care Reimbursement Account (HCRA)?

Do you or your dependents have predictable health care expenses such as regular office copays, regular use of prescription drugs or vision care needs not covered by insurance? Do you expect any significant one-time expenses, such as orthodontia? Estimating these expenses can give you a good idea of how much money to contribute to a HCRA.

What dependents are legally eligible for coverage under a HCRA?

You may use your HCRA to reimburse eligible medical, dental, vision, and other health care expenses incurred by you or those dependents that you claim on your federal income tax return for the year (e.g., your spouse, your children, or your parents).

Will I be able to change the money I set aside in my account during the plan year?

Changes to your spending account elections are allowed during the plan year only if you experience a change in family status. Changes in family status include:

• Marriage
• Divorce or legal separation
• Birth or adoption of a child· Dependent child's loss of eligible dependent status under the plan
• Death of your spouse or a dependent
• Change of employment status for you or your spouse
• Change in place of residence or worksite
• Qualified Medical Child Support Order (QMCSO)
• Entitlement to Medicare or medical benefits
• Significant cost increase or a significant curtailment in coverage

Proof of these events is required and should be attached to the Family Status Change Form. Examples of proof are:

• a copy of a birth certificate or adoption placement paperwork for a new dependent child,
• a copy of a marriage license for a marriage,
• a copy of the divorce decree for a divorce, etc.

If you have questions about proper supporting documentation, please email Benefits@eFunds.com.These changes must be consistent with the event. Example: If you are covered under a spouse's insurance plan, and you are enrolled in the medical and dental options, and that coverage is lost, you can only elect medical and dental coverage under the eFunds plan. If you experience a change in family status and wish to change your benefits, you must complete the Family Status Change form located under the Forms link on eServe. You must make any benefit changes resulting from a change in family status within 31 days of the event.

What happens to my spending account benefit if I leave eFunds?

You will have 90 days after leaving eFunds to submit health care claims for reimbursement. However, services rendered for health care expense reimbursement must be incurred prior to the date of your termination of employment, unless you continue contributing to your health care account through COBRA. You become eligible for COBRA continuation coverage when any of the following "qualifying events" occur:· Loss of benefits due to a reduction in your hours of employment · Termination of your employment (except for gross misconduct) · Loss of benefits due to your transfer to a subsidiary, affiliate, or class of employees not eligible for this coverage.

How can a spending account save me money?

You contribute to your spending account on a pre-tax basis. This means you do not pay any federal, Social Security, and, in most cases, state or local income taxes on your contributions to an account. Depending on your personal situation, you may save taxes of 30% or more on these amounts, which you can then use to pay medical or dependent care expenses throughout the year. Let's look at an example.

How do I file a claim for reimbursement?

You can fax a claim form to FlexAmerica at 1-888-728-3250 or mail them to:

FlexAmerica
P. O. Box 341130
W. Bethesda, MD 20827

A claim form can be fond under the Forms link. Claims are paid on a weekly basis on Thursdays. Any claim received by Tuesday will be paid on Thursday of that same week.

Remember: Even though not all transactions using the debit card will require to to submit a claim, you should still keep your receipts for your tax records.