Frequently Asked Questions - Medical Mutual - Individual Health Insurance, Group Health Insurance, SuperMed One, Health Savings Accounts, HSA Accounts, High Deductible Health Plan, Medicare Supplement

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What is a Flexible Spending Account (FSA)?

An FSA is a benefit provided by your employer that lets you set aside a certain amount of your paycheck into an account before paying income taxes. Then, during the year you can use funds in the account to pay for qualified expenses with tax-free dollars. FSA components include: Health Care Account, Dependent Care Account, Commuter Benefits, and Adoption Assistance. Check with your employer for more details.

What is a Health Care Account?

The Health Care Account allows employees to set aside a portion of their paychecks (before taxes) into an account to budget for expenses not covered by another health plan. The participant can use the account to pay for over-the-counter medicines, co-pays at the doctor or pharmacy, chiropractic care, eyeglasses, contacts, LASIK, orthodontics, and more.

What is the Dependent Care Account?

Employees set aside pre-tax payroll deductions in the account to budget for the daycare expenses of a dependent child under age 13. Qualified expenses include nannies, babysitters, housekeepers, nurse's fees, and registration fees to a daycare facility. The cost of pre-K or nursery school, before and after school care, and day camp also qualify. To qualify, expenses paid for daycare must allow an employee or the employee's spouse to work or look for employment.

What are Commuter Benefit Accounts?

Through payroll deduction, employees contribute to an account that saves 25% to 40% on the expense of parking near their place of employment, and travel to and from work. During the year, participants may access this account for transit and parking expenses. Payments from the account are tax-free to employees. Monthly expense limits for 2008 are $220 per month for parking and $115 per month for transit passes and commuter highway vehicles.

What is the Adoption Assistance Account?

Employees set aside pre-tax payroll deductions to pay expenses for home study and application fees, reasonable and necessary legal adoption fees, court costs, attorney fees, agency fees, medical services and counseling, travel and lodging fees, and other expenses which are directly related to, and the purpose of which is for a legal adoption.

Why should I participate?

Your biggest advantage is your savings on withholding taxes. That's because you save $25 to $40 on every $100 you budget to pay for qualified expenses. For every dollar you set aside to pay qualified expenses, you save social security tax (FICA), federal income tax, and (where applicable) state withholding. Your net take-home pay increases by the tax you save. Plus, when you pay a qualified expense or receive a cash reimbursement, it's TAX FREE.

What expenses qualify for payment?

Most qualified expenses are for goods or services that you'll buy anyway. They include healthcare costs such as co-pays, doctors' fees, prescriptions, over-the-counter medications, dental and eye care expenses, and daycare expenses for dependents so you can work.

I already have health insurance. Why should I participate in the Healthcare Account?

The Health FSA account is used to pay for expenses not covered by insurance. For example: co-pays, glasses, contacts, and orthodontics, prescription drugs, over-the-counter medications, deductibles, co-insurance, weight-loss programs, etc.

I don't use my employer's health insurance. Can I still participate?

YES! You can still participate and set aside money (on a pre-tax basis) to budget and pay for your family’s qualified expenses. However, a qualified expense paid from this plan is not eligible for reimbursement from another plan.

How do I enroll?

Estimate your out-of-pocket expenses. Complete an enrollment form provided by your employer during the enrollment period. Then set aside money, tax-free, through regular payroll deductions. For more information you may contact your human resources department.

How do I file a claim?

Claim forms may be completed and printed online at MyFlexOnline.com. Claims must be submitted with proof of qualified expense such as a copy of the bill, receipt or an explanation of benefit (EOB) from your insurance provider. Proof must include the service rendered, date-of-service, provider name, and your actual out-of-pocket expense. You may fax or mail your claim request. Within a short time, you will receive your TAX-FREE reimbursement.

NOTE: If Medical Mutual is your healthcare provider, you may be eligible for the automatic EOB rollover feature which allows automatic reimbursement without the need to file a manual claim. See your employer or more details.

Must money be deposited in my account before I pay expenses or file a claim?

The entire annual amount you elect for the Health Care Account is available on the first day and throughout the plan year. However, for Dependent Care Account, contributions must be deposited before funds are available for reimbursement.

How will I know my account balance?

A participant may obtain account balance information in the following ways:
1. Contact your employer for the customer service number
2. on line at MyFlexOnline.com
3. Interactive Voice Response (IVR)
4. Reimbursement check stubs

Can I make changes to my account?

For the Health FSA and Dependent Care Benefit, you can change your election if you have a change in family status. A change in your family status includes: marriage, birth, death, divorce, adoption, or a change in employment for your or your spouse.

Will an FSA affect my Social Security Benefits?

Social Security Benefits are based on your lifetime earnings history. Because you do not pay social security tax on the amount of gross pay you set aside to pay for qualified expenses, your social security benefits at retirement are slightly reduced. However, tax professionals advise that tax savings you earn today far outweigh any reduction in Social Security benefits.

What if I terminate employment?

You may request reimbursement for qualified expenses incurred prior to your termination. Check your Summary Plan Description for additional rights provided by your employer's plan.

Could I lose my money?

Yes, funds not used during the plan year will be forfeited. However, you may be eligible to continue to incur expenses for 2 ½ months after the end of the plan year. You should refer to your Summary Plan Description for verification. We do recommend that you carefully budget and calculate your qualified expenses.

NOTE: For Health Care Account, your entire annual election is always available for you to spend on eligible expenses from day-one of the plan year.

What is the debit card?

The debit card is an employer-offered feature that you can order online. Your debit card can be used at FSA eligible locations. One benefit of the debit card is you do not have to pay qualified expenses out of your personal funds and then wait for reimbursement. The card is optional and for your convenience.

Where is the debit card accepted?

Although it looks like a typical debit card, the card will be accepted only at qualified locations. For example, it works at pharmacies, doctor's offices, vision care centers, hospitals, etc. The card does not work at ATMs. These IRS-imposed limitations help to limit card use to pay only qualified expenses. If there is a sufficient balance available in your flex account, the card swipe is approved and the payment is deducted from your account balance.

The card is to be used only for qualified expenses. How is it verified?

The IRS requires that your plan service provider verify all card swipes. Certain swipes are automatically verified. For example, if your card is swiped for a co-pay at a doctor's office, you are not asked to provide a receipt. The same is true when a co-pay is made at the pharmacy. If, however, you present the flex plan card to make a pharmacy co-pay and to purchase a bottle of aspirin (or other over-the-counter health care items), you are asked for a copy of the card receipt. Here's why. If the total amount of a card swipe does not match your co-pays, the IRS requires that all details on each receipt be verified as qualified plan expenses.

On the other hand, you are not asked to submit a receipt when you shop at one of our retail partners such as Wal Mart. That's because their systems only allow a qualified plan expense charge on your flex plan card. Therefore, when your shopping basket contains both qualified health care items and other merchandise, your transaction is automatically split and you are asked for another form of payment to complete your purchase.

Questions Regarding FlexSave Healthcare Accounts

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