spending accounts (for plan year 2013) health care & dependent care shps

Spending Accounts (For Plan Year 2013)

Health Care & Dependent Care

SHPS

February 2010 2APRIL 2010

Spending Accounts – SHPS/ADP No increase in admin fees with current plan design

HCSA annual maximum will reduce from $5,040 to $2,460

– Monthly maximum will be $205

– Compliance with Patient Protection and Affordable Care Act (PPACA)

– Note: a monthly administration fee of $3.20 is included in the total contribution amount

Employees who contributed a larger amount in 2012 will be reduced to the new HCSA maximum for 2013

Plan Design/Premium Changes for AE 2013


How Does it Work?

Employee chooses a monthly contribution amount

Pre-tax contribution is transferred into the Spending Account

Employee submits eligible expenses

Employee reimbursed with pre-tax dollars


General or Limited Purpose Health Care Spending Account

Employees may submit eligible expenses for your spouse (e.g. coinsurance payments; deductibles from another health plan)

It is illegal to submit expenses that have been paid by another insurance plan or reimbursed by another spending account

Children’s medical expenses covered under the employee, as well as the spouse’s, group medical coverage can be submitted

An Explanation of Benefits from both insurance carriers is required


Limited Purpose Health Care Spending Account

Employees must select if enrolling in a Health Savings Account

Only dental and vision costs that are not normally eligible under the General Purpose Health Care Spending Account are covered


Health Care Spending Account Debit Card

Employee must keep the EOBs and/or receipts

SHPS will request supporting documentation, normally every 2 months

EOBs and/or receipts along with the request letter from SHPS must be submitted for validation purposes

SHPS will submit validation letters online

If SHPS has the employee’s email address, requests will be emailed directly to the individual


Health Care Spending Account Debit Card

If documentation is not received after the validation request is issued, the card will be turned off (60 – 90 days)

An overpayment will be noted on the account

When a paper claim is received, a reimbursement will not occur. It will be deducted from the overpayment showing


Dependent Care Spending Account

Maximum contribution: $416/ month (maximum of $4,992/ year)

Coverage for new employees is effective the first of the month following one full calendar month of employment

Monthly administration fee: $3.20

Reimbursement requests will be processed after services have been fully rendered

Reimbursement subject to account balance

Department must transfer contributions to SPA before account can be credited


Dependent Care Spending Account

Eligible dependents would include:

Children under age 13

Spouse (if mentally or physically disabled)

Any other person who is a qualified IRS dependent, regardless of age, who is mentally or physically disabled

Health Savings Accounts



Tax-exempt account that can be used for qualified medical expenses not otherwise covered by the High Deductible Health Plan*

Qualified medical expenses include:• HDHP* Deductibles• Co-payments• Prescriptions and over-the-counter medication• Dental services• Vision Care

Must be enrolled in a High Deductible Health Plan (HDHP)

Cannot be enrolled in Medicare

Cannot be covered by another Health plan

Cannot be claimed as a dependent on someone else’s tax return



Funds are not subject to forfeiture; rollover from year to year

Maximum allowable contributions for Plan Year 2009:

Single: $3,000

Family: $5,950

Monthly service charge: $3.20 Additional contributions to the HSA can be made outside normal payroll deductions Contribution tickets are included with the HSA Welcome Kit to make post-tax

contributions It is the HSA account holder’s responsibility to ensure the total contributions do not

exceed the maximum allowed by the IRS



Money in the HSA can be used for an emergency situation for a non-qualified expense The distribution would qualify as taxable income

• 10% penalty tax would be assessed NOTENOTE: Agencies should not take a December payroll for January coverage, unless the

employee already had an HSA account. Investment opportunities are available through HSA administrator (JP Morgan Chase) Must maintain a $2,000 minimum account balance to qualify Investment transfers, contributions changes, and change of beneficiaries can be made anytime

during the Plan Year Catch up provision is provided

• Age 55 or older may contribute an additional $800 per year above the HSA maximum Tax Forms required for the HSA:

• Distributions reported on Form 1099 SA• Contributions reported on Form 5498 SA

spending accounts (for plan year 2013) health care & dependent care shps

Documents

health planit

spending accounts shpsadp

high deductible health

qualified medical expenses

insurance plan

account balancedepartment

month maximum

monthly maximum