Let’s talk about the specifics of your Flexible Spending Account, or FSA.
ConnectYourCare is the administrator of your healthcare accounts. With ConnectYourCare, you will receive access to an online portal to view your account balance, review transaction and claims history, and use health education tools. You will also receive a healthcare payment card to access funds.
Enrolled employees have access to an online portal, an online one-stop-shop for account information and health education tools. In here, you can view account balance and transactions, submit and view claims and reimbursement requests, manage personal and direct deposit bank information and access a variety of health education tools.
You will have access to a number of health education tools through the online portal. These advertisement-free online tools are a great resource for trusted healthcare information. From looking up the average cost of a prescription, to finding the best hospital in your area for treatment, to researching a medical condition, these health education tools cover your health information needs in one place.
You will be issued a healthcare payment card to easily access account funds. The card will be mailed to your home address. Please be on the look out for the card so you do not accidentally throw it away! The card is active upon receipt; there is no need to call to activate the card. I know this is little confusing, but even though the card says “debit” on the front, when you swipe the card at the merchant, please select the “credit” option or tell them it is a “credit” card. Your card is merchant coded and will work at all IRS compliant merchants. When you use your card, always remember to save your receipts. ConnectYourCare may require them to substantiate the eligibility of a purchase, or the IRS may require them at tax time. Keep in mind that only itemized receipts can be used to substantiate the eligibility of a purchase. Always save your itemized receipts!
If using the card is not possible – like the provider does not accept credit cards or you left the card at home – you may pay for purchases out of pocket and request reimbursement online. Whether you use your card or not, always show your health insurance card when paying for any healthcare service to ensure that you will be properly charged. The online reimbursement request process is quick and easy. Simply login to your online account and follow the instructions to submit a new claim. Once your claim is received, you can view your claim online to ensure it’s been received correctly. ConnectYourCare will process your claims in a matter of days. Once approved, reimbursements will be issued to you via check or direct deposit. You can get your reimbursement faster if you set up direct deposit online!!!
When you use your card or pay for an expense out of pocket and request reimbursement, always remember to save your receipts. ConnectYourCare may require them to substantiate the eligibility of a purchase, or the IRS may require them at tax time. Keep in mind that only itemized receipts, that indicate the product can be used to substantiate the eligibility of a purchase. Credit card receipts, non-itemized cash register receipts and cancelled checks are not acceptable forms of documentation.
A Flexible Spending Account is a tax-advantaged account that allows you to use pre-tax dollars to pay for out-of-pocket qualified medical or dependent care expenses. You choose how much money you want to contribute to an FSA at the beginning of each plan year; you have access to the funds throughout the plan year. It’s very important to remember – this account is a USE IT or LOSE it account. Any money not spent is reverted back to your employer.
There are hundreds of uses for your FSA funds, including medical, dental, vision, and prescription expenses for you, your spouse or your dependents. Here are just some examples of qualified FSA expenses, as deemed by the IRS.
Some over-the-counter treatments are eligible for purchase with FSA funds. Other items require a prescription. The OTC items covered include many medical devices and other non-medicinal healthcare products. This list is subject to change. Please see www.connectyourcare.com/otc for updated information.
These expenses are not FSA qualified. It is important to know what is and what is not qualified. For instance, you can see vitamins are not covered, but pre-natal vitamins are.
You may also choose to enroll in a Dependent Care Assistance Program FSA, or DCAP, which covers employment-related dependent and elder care expenses and is an alternative to the Dependent Care Tax Credit.
There are some eligibility requirements. You must have incurred the expenses in order for you and your spouse, if married, to work or look for work, unless your spouse was either a full-time student or was physically or mentally incapable of self-care. You cannot have made the care payments to someone you can claim as your dependent on your federal tax return or to your child who is under age 19. For example, you cannot pay your oldest child to baby-sit your toddler. You and your spouse must maintain a home that you live in for more than half the year with the qualifying child or dependent.
Here is a list of qualified dependent care expenses. Pre-school, day care, camps, and before and after school care, are examples of eligible expenses.
Here is a list of expenses that are not qualified. The most important item to remember on this list is that you cannot pay for services that have not yet been provided. So, you cannot pay ahead for child care.
The IRS requires FSA administrators collect documentation from participants to show the items purchased with their account funds are qualified healthcare expenses. Some of your purchases will be automatically checked for eligibility, but for those that are not, ConnectYourCare will need to collect the documentation from you. If you pay for an expense out of pocket and request reimbursement, you will have to submit your itemized receipt. Even if you pay for an expense using your healthcare payment card, you may still need to submit receipts to ConnectYourCare for the purchase. ConnectYourCare will post a notice in your online account and send you notices to let you know when receipts are needed. It’s an easy process to submit receipts. And, it’s really important to submit receipts when they are required because your card could be suspended if receipts are not received.
The IRS makes it easier for you to use your card at retailers by requiring retailers to comply with IRS inventory control guidelines, called IIAS. Many large retailers, pharmacies and supermarkets are IIAS compliant and will automatically substantiate your purchases, limiting the need for you to submit receipts. The CYC website provides a list of certified merchants and their planned implementation dates. The list is continually updated as additional merchants are certified and go-live dates change. Check back often! Unfortunately, healthcare providers like dentists, doctors and hospitals cannot auto substantiate your purchases. Since healthcare providers often cover ineligible expenses, like teeth whitening or cosmetic surgery, it’s impossible to verify that your card purchase at a doctor, dentist or hospital is for an eligible expense. So, you need to save your receipts for all card purchases at these locations and be prepared to send them in. Unfortunately, you cannot use your card to pay for expenses from your dependent care account. Instead, you may pay out of pocket and submit a request for reimbursement online.
If you pay out of pocket and request reimbursement or if your card purchase is not automatically checked to verify eligibility, you will have to submit receipts to ConnectYourCare. It’s easy to submit receipts for payment card purchases. Simply log into your online account and your card transaction will already display. Print your claim form and fax the form along with your documentation to ConnectYourCare. Or, you can use the letter ConnectYourCare mailed to you as your claim form and fax it with your documentation to ConnectYourCare. You can also send your form and receipts through the mail if you don’t have access to a fax machine. When you are submitting receipts, please keep in mind that each bar-coded claim form is unique. The bar code at the top of the form enables ConnectYourCare to electronically match the receipts you are submitting with the claim in your account. Be sure the receipts you send match the claim form you are submitting them with. If you are submitting documentation for several claims at one time, you may need to check the form number to be sure it matches. You can always view an image of your claims submission online to ensure it’s been received correctly. If receipts are submitted incorrectly, ConnectYourCare could have to request the documentation again. Additionally, you can get your reimbursement faster if you provide your direct deposit information online!!!
Since FSAs and DCAPs can cover medical, dental or vision, and dependent care expenses that you would otherwise pay out of pocket, you can potentially save hundreds of dollars in taxes. In this example, an account holder contributed $5,000 to her FSA. At a 31% tax rate, she saved $1,550 that year in taxes. You’ll also find that FSAs are especially useful when large healthcare expenses, like braces or laser eye surgery, are on the horizon.
Here are some of the most frequently asked questions we hear about FSAs. How will I be able to access my account funds? Your healthcare payment card will be the easiest way to access your FSA funds. You can also pay with another form of payment and request reimbursement from your account. When can I request reimbursement from my account? You can access your account as soon as your coverage starts. How will I know if I need to submit a receipt to ConnectYourCare for substantiation? You will get an email or a letter within a week of your payment card swipe or you can log in and go to the Claim Center. What if I don’t submit my receipts? You will need to refund the amount of the transaction or your payment card will be deactivated. If you fail to reimburse the account, the amount of the ineligible expenses may be added to your W-2 or withheld from your pay (at your employer’s discretion). Visit www.connectyourcare.com for more Frequently Asked Questions. Thank you for your time. We hope that you enjoy the significant advantages offered through a Flexible Spending Account and we look forward to serving you through the administration of your healthcare account.