Frequently Asked Questions (FAQs)

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FAQs about Flexible Spending Accounts (FSA)

Questions pertaining to cafeteria plans and flexible spending accounts (FSA)

Can I be reimbursed for a service that has been provided although I have not yet paid the bill?

The operative date for claim reimbursement is the service date, not the date the expense is paid. You may submit expenses billed to you before you remit payment, but you may only submit the expense once. You may not submit the expense again after it has been paid.

Can I change my election after the plan year starts?

You can only change your election if you have a qualifying change of status event. Qualifying events include:

  • A change in the participant’s legal married status
  • A change in the participant’s number of dependents

For more information, see IRS Account Rules.

Does it save me more money to use a dependent care FSA or to receive the dependent care credit on my tax return?

In general, the higher your adjusted gross income, the more likely it is that you will benefit more from participating in the dependent care FSA than from taking the tax credit. Note that the amount you elect to place in your dependent care account reduces your potential tax credit.

Does participating in a cafeteria plan reduce my Social Security benefits when I retire?

Yes. Generally speaking, however, the benefit of the tax savings now more than outweighs the reduction in Social Security benefit after you retire. Discuss your specific financial situation with a tax consultant.

How are orthodontic expenses reimbursed?

Orthodontic expenses are eligible to be reimbursed in the same way as any other medical expense. However, because such treatments generally cover an extended period of time, you have the option of scheduling monthly reimbursements rather than payment up front. In addition, if your current election does not cover the total expense of the treatment(s), it can be reimbursed over multiple plan years as long as the treatment dates occur during those years.

How do I benefit from participating in an FSA?

There at least two significant ways to benefit from an FSA. The first is by taking advantage of the tax savings. By reducing your gross income, you pay less in taxes, take home more pay and have the freedom to choose how your money is used or invested. The second benefit is the “cash flow” increase built into the medical FSA (not the dependent care FSA). This means that no matter how much money you have actually contributed to the plan at any given point, you can still be reimbursed up to your entire annual election. So a major medical expense at the beginning of the claim period can be reimbursed even though few, if any, deposits have been made into the account at that time. This applies to the medical FSA only.

How do I find out the balance of my medical and dependent care FSAs?

Each time you are reimbursed for a claim, myCafeteriaPlan will provide a “statement of account” with your reimbursement check to let you know the balance of your remaining funds. In between statements, you can check your balance online by visiting myCafeteriaPlan’s Account Login, or by logging into the myCafeteriaPlan On-the-go AppSM.

How do I get reimbursed for my expenses?

Using a Claim Form, you may submit your claim and supporting documentation to myCafeteriaPlan by mail, fax or electronic submission. Please visit the Contact Us page for more information.

For more detail on preparing a claim for submission, visit the Claim Submission page.

How do I track my account(s) online?

From the myCafeteriaPlan home page, click on the “Participant” button, then click the link under New User to set up your account. Once you’ve logged into your account, you’ll be asked to answer a few short security questions and create your password. You can also check your account balance(s) and see the status of any claims you have submitted.

Please note: When updating your personal information it is important to provide your email address for the fastest and most efficient communication.

How does my net pay increase by participating in a cafeteria plan?

A Cafeteria Plan is a benefit provided by your employer which allows you to contribute a certain amount of your gross income to a designated account or accounts before taxes are calculated. These accounts are for insurance premiums and medical or dependent care expenses not covered by your insurance, from which you can be reimbursed throughout the plan year or claim period as you incur the expenses. A cafeteria plan allows you to reduce your gross income, thereby reducing the amount you pay in Federal, Social Security and some State taxes – a savings of between 25% and 40% of every dollar you contribute to the plan.

How often will my claims be reimbursed?

Your company’s claims will be reimbursed on regularly scheduled processing days. You can obtain the processing/reimbursement schedule by contacting a myCafeteriaPlan representative or your Human Resources department. myCafeteriaPlan has a submission deadline of noon (12pm EST) on the day prior to your company’s processing date. In other words, any claims received by noon (12pm EST) the day before the processing date will be reimbursed (if eligible) on that date.

What expenses are eligible for reimbursement from an FSA?

Amounts paid to a daycare provider either in or out of the home are eligible, as long as the provider is not a dependent or relative under the age of 19. Pre-school tuition is reimbursable, but tuition and expenses from grade K-12 schooling are not.

For medical accounts, any out-of-pocket expenses related to services covered by insurance, including co-pays, deductibles, prescription drugs, and out-patient elective surgery; dental, orthodontic and ophthalmologist’s fees and expenses including prescribed treatments and maintenance (such as contact solution); chiropractic, psychiatric, and psychologist’s fees and expenses; disability-related expenses; and over-the-counter (non-prescription) drugs such as pain relievers and allergy medications are eligible.

In general, any treatment for a specific medical condition is reimbursable; cosmetic or preventative expenses are not. For example, teeth-whitening and multi-vitamins are not eligible, but prescription sunglasses and non-prescription allergy medicines are.

Insurance premiums are not eligible for reimbursement.

View a more detailed list of Eligible Expenses.

What happens if I leave my place of employment while participating in an FSA?

Expenses incurred during the plan year prior to termination can be submitted for reimbursement for a period specified by the employer in the Plan Document (usually up to 30 days after termination).

What happens if there is money left in my account at the end of the claim period after all my eligible expenses have been reimbursed?

Unless your company’s plan document states otherwise, any funds remaining after all eligible reimbursements have been made is forfeit to the cafeteria plan; these funds are used to offset plan losses and expenses.

In order to prevent the loss of funds, it is important to plan carefully so that your annual election matches your actual expenses as closely as possible. Of course, it is impossible to project with 100% accuracy, so you may come up short or have a little money left at the end of the claim period.

However, it is important to realize that loss of funds does not necessarily indicate a loss out-of-pocket. In most cases, even when participants claim less than their election, they still save money by participating in the plan. For example, if your calculated annual tax savings is $1,200 (based on a $4,800 election) and you only use $4,600, you’ve still saved money – in this example, $1,000.

What if I am not billed for an expense until after the end of the claim period?

After the claim period, there is a “Run-Out” period as specified in the SPD for submitting claims incurred during the claim period. This allows all eligible expenses up to the very last day of the claim period to be submitted and reimbursed.

What is a Cafeteria Plan?

A Cafeteria Plan is a benefit provided by your employer which allows you to contribute a certain amount of your gross income to a designated account or accounts before taxes are calculated. These accounts are for insurance premiums and medical or dependent care expenses not covered by your insurance, from which you can be reimbursed throughout the plan year or claim period as you incur the expenses. A cafeteria plan allows you to reduce your gross income, thereby reducing the amount you pay in Federal, Social Security and some State taxes – a savings of between 25% and 40% of every dollar you contribute to the plan.

What is a Flexible Spending Account (FSA)?

An FSA is an account into which your contributions (from pre-tax salary reductions) for medical and/or dependent care expenses are deposited. It functions like a checking account in that the cafeteria plan administrator (myCafeteriaPlan) actually writes you checks for the medical and dependent care expenses that you submit.

What is the Claim Period?

The Claim Period is the period specified in the SPD of at least 12 months that determines the beginning and ending dates of expenses eligible for reimbursement, occurring simultaneously with the plan year. In other words, it is the period of time that claims can be incurred and reimbursed from current plan contributions. The beginning date always coincides with the beginning of the plan year, but the end date may not.

What is the maximum amount of money I can elect annually for an FSA?

For a medical FSA, the maximum annual election is set by your company and can be found in the Summary Plan Description (SPD). For a dependent care FSA, the maximum annual election is set by the IRS and is as follows:

  • Married Filing Jointly or Single Head of Household, $5,000
  • Married Filing Separately, $2,500
What is the Plan Year?

The Plan Year is the 12-month period specified in the SPD that determines the beginning and ending dates of plan contributions (salary reductions).

Who is considered a dependent?

For medical accounts, the general rule is that if you can claim an individual as a dependent on your tax return, then you can claim them under the Cafeteria Plan.

For dependent care accounts, only children under the age of thirteen or adults or children over the age of thirteen who are incapable of self-care are considered dependents. In addition, the dependent must reside with the participant for the majority of the year in order to be eligible for coverage under the dependent care FSA.

Please note: to be eligible for a Dependent Care FSA, a participant must be employed and, if married, the participant’s spouse must also be employed. A change in employment status for either the participant or the participant’s spouse may result in a change in or loss of eligibility.

For more information, see IRS Account Rules.

FAQs about Flex Cards

Questions pertaining to cafeteria plans and flex cards.

Can I order a third Flex Card?

You will receive two cards so that another family member can use the additional card. This second card will have the same account number. You may order a third Flex Card for a fee of $5, which will be deducted from your account. To order a third card, contact a myCafeteriaPlan representative.

How do I activate my Flex Cards?

When you receive your new Flex Cards, you can activate them immediately via the toll-free number on the sticker on the front of the card. Only one card will need to be activated for both cards to work.

How do I benefit from using a Flex Card?

Using a Flex Card eliminates the time spent waiting on reimbursement checks. This allows you to bypass the inconvenience of restricted cash flow arising from the “lag time” between the expense and the reimbursement. However, you may be asked to document your expense after using the card.

How long is my Flex Card valid?

Generally, your Flex Card will be valid for three years from the month that you receive it, unless you terminate your participation in the plan or all cards are re-issued for your plan. Approaching the expiration date, a new card will automatically be ordered and sent to you.

What happens if I use my Flex Card for an ineligible expense?

If the transaction is ineligible or lacks sufficient documentation, you will be notified via the monthly receipt request. You have up to 60 days from the initial notification to provide the supporting documentation or to repay the cafeteria plan by making a check or money order (payable to your employer) for the amount of the ineligible transaction. At the end of that period (60 days from the initial notification), if the expense has not been approved or repaid, either a payroll deduction for that amount will be taken by your employer, or your Flex Card will be deactivated. You will be notified of any payroll deductions by your employer.

If your plan year ends or your employment has been terminated prior to the resolution of outstanding ineligible charges, remember that you are still responsible to reimburse the plan for the ineligible charges. Intentional fraudulent use of the Flex Card can lead to the deactivation of your card and/or legal action.

What if my Flex Card is lost or stolen?

To report a lost or stolen Flex Card, simply contact a myCafeteriaPlan representative. Your missing card will be immediately deactivated and new cards will be ordered for you. A $5 replacement fee will be deducted from your account. In the event that unauthorized charges appear on your account, you may contact a myCafeteriaPlan representative to dispute the charges.

What if the provider location doesn’t accept my card?

If you are unable to use the Flex Card, simply pay the expense and submit it for reimbursement on a paper claim form. See How to Submit a Claim

What is a “receipt request” and what do I do with it?

A receipt request is a notice that supporting documentation is needed for verification of transactions that have occurred. This notice lists “initial receipt requests”, “second receipt requests”, and “ineligible expenses” (items not approved or not documented). Automatically approved transactions will not be included on that notice. When you receive a receipt request, gather all supporting documentation for each transaction listed and submit it. DO NOT use a traditional (paper) claim form for a Flex Card transaction. Using a paper claim form for a Flex Card transaction may result in the expense being tagged as a duplicate (ineligible) claim.

Go to the Receipt Request page for more information.

What is a Flex Card and how does it work?

If your company offers the additional benefit of Flex Cards, you can visit the Flex Card section of our FAQ page to find out more information.

What is a Flex Card?

A Flex Card is a stored value card that reflects the balance of your medical and/or dependent care reimbursement account or flexible spending account. Since there are no transaction fees or pin numbers, the card should be swiped through the provider location scanner using the “credit/credit card” option. When the Flex Card is swiped, the funds are immediately and directly withdrawn from your account.

When will I receive my Flex Card?

You will receive your Flex Card approximately three weeks from the date that myCafeteriaPlan receives your enrollment information. Expenses incurred prior to receipt of the card (after the date of enrollment) can be submitted for reimbursement as a paper claim.

Where can the Flex Card be used?

The Flex Card can be used at any properly coded provider location (including pharmacy and daycare) that accepts the provider logo on your Flex Card (MasterCard or VISA).

Will I be asked to document all the expenses I use my card for?

Not necessarily. Due to regulation changes by the IRS, not all Flex Card transactions require documentation if properly “coded” in the  Inventory Information Approval System (IIAS). With the IIAS in place, provider locations with “non-medical” Merchant Category Codes (MCCs) “auto-check” the item in question for eligibility under a reimbursement plan. Items marked under the IIAS as eligible will be accepted on the Flex Card and ineligible items will be denied. This system eliminates both the hassle of submitting claims or documentation for eligible items and the inconvenience of having to repay the reimbursement plan for improperly swiped ineligible items.

As a result, however, provider locations with non-medical MCCs will not accept Flex Cards.

In other words, grocery stores or other locations that sell reimbursable prescription and over-the-counter (OTC) items will not be able to accept the Flex Card unless they have implemented the IIAS.

For example, an eligible OTC item such as bandages swiped at grocery store with the IIAS will be automatically approved by the plan and can be paid for using the Flex Card with no other documentation necessary. Bandages purchased at the same time from a non-IIAS-participating retailer, while an eligible item, will have to be submitted for reimbursement after the purchase, since the retailer will not be able to accept the Flex Card.

Will I still need to keep my receipts?

Yes. According to IRS regulations, each Flex Card transaction needs to be verified for eligibility in the same way that paper claims are. As a result, once a transaction is made using the Flex Card for your flexible spending account or health reimbursement arrangement, myCafeteriaPlan will need supporting documentation to approve the claim and will send out a “receipt request” once a month to obtain that documentation.

FAQs about Health Savings Account (HSA)

Questions pertaining to health savings accounts (HSA)

Am I eligible for an HSA?

If you meet the following criteria, you are eligible to deposit money in an HSA:

  1. You are enrolled in a qualified high deductible health plan (HDHP).
  2. You cannot be claimed as anyone’s dependent.
  3.  You are not covered by any non-qualified plans.

These eligibility rules determine if you can add to your HSA account, not if you can spend your HSA money. This is a handy feature should your eligibility change in the future.

How are contributions made to my HSA account?

Contributions can be made by you, your employer or both. However, the total contributions are limited annually. There are two ways you can contribute to your HSA account:

  1. Do the paperwork – send your contribution to the bank. You’ve paid taxes on this money already so you’ll have to deduct this amount when you file your taxes.
  2. Skip the paperwork – Avoid the taxes and have your employer deduct your contribution pre-tax from your paycheck. They will forward your contribution to the bank. Your contributions are tax-free so there’s no need to worry about deducting on your taxes.
How much can I contribute to an HSA?

For 2022, you can contribute the following amounts:

  • $3,650 if you have self-only coverage
  • $7,300 if you have family coverage
  • For those 55 and older, an additional $1000 “catch-up” contribution is allowed.

If you join an HDHP mid-year, there are special rules about how much you can contribute. To avoid possible complications, we recommend pro-rating your HSA contribution to not exceed the following monthly amounts:

  • $304.16 (1/12 of $3,650) if you have self-only coverage
  • $608.33 (1/12 of $7,300) if you have family coverage

So if you join an HDHP on October 1st, your HSA contributions should not exceed:

  • $912.48 if you have self-only coverage
  • $1,824.99 if you have family coverage

You are allowed to contribute more than the pro-rated amounts, but there can be negative tax consequences if your HSA eligibility changes.

What expenses are eligible?

Eligible medical expenses are defined by the IRS in Section 213(d) and are listed in IRS Pub 502. Most medical, dental, vision and over-the-counter expenses used to treat a medical condition are eligible. These expenses can be for you, your spouse or your dependents even if they are not covered on your HDHP.

A few examples are:

  • Copays
  • Deductibles
  • Co-insurance
  • Office Visits
  • Dental Cleanings
  • Glasses
  • Contacts
  • Aspirin
What expenses are not eligible?
  • Health insurance premiums (other than COBRA and select Medicare plans)
  • Non-medical expenses
  • Cosmetic procedures (teeth whitening, cosmetic surgery, etc…)
  • Medicare supplement insurance premiums
  • Expenses reimbursed from any other source

All ineligible HSA distributions are taxable as income and subject to additional tax penalties so it is very important to know what is eligible.

What is a Health Savings Account (HSA)?

A Health Savings Account (HSA) is a special bank account used to pay for current and future medical expenses tax-free.

What is a High Deductible Health Plan (HDHP)?

A HDHP is a medical insurance plan that meets specific criteria set by the IRS. For 2022, a HDHP must meet the following standards:

HDHP Minimum Annual Deductible HDHP Out-Of-Pocket Maximum
Self-Only $1,400 $7,050
Family $2,800 $14,100

If you are unsure if your plan meets the HDHP requirements, check with your insurance provider.

What is a non-qualified plan?

A non-qualified plan is any medical plan that does not meet HDHP requirements. Coverage under any other medical plan (primary or secondary/dependent coverage) will make you ineligible for an HSA plan.

Three important details:

  1. Always check with your insurance provider to see if your plan is HSA compatible.
  2. Spouse coverage can affect your eligibility. If your spouse is enrolled in any medical plan, verify that you are not covered on their plan(s). Some plans cover spouses by default and could make you ineligible to contribute to an HSA plan.
  3. There are many commonly overlooked non-qualified plans. A few examples include:
  • Medicare
  • Medicaid
  • Tri-Care
  • VA Benefits*
  • Flexible Spending Accounts (FSA)
  • Health Reimbursement Arrangement (HRA)
  • Medical Reimbursement Plan (MRP)

*If you haven’t received Veteran’s benefits in the last three months, you can contribute to an HSA plan.

Why would I want an HSA?

An HSA is a way to help you save money on your medical expenses. The main advantages of an HSA are:

  • Tax Savings: An HSA account allows for tax free contributions, tax free distributions and tax free growth on accumulating balances.
  • Affordability: You may be able to lower your health insurance premiums.
  • Ownership: The account belongs to you (not your employer) and is portable if you change jobs.
  • Control: You make all the decisions about the account management including how much to put in, how much to take out and how to invest your funds.
  • Flexibility: You can change your contribution amount at your discretion. Also, all funds remain in the account from year to year. There are no “use it or lose it” rules for HSAs.