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Flexible Spending Account Frequently Asked Questions

Questions

1. What is a Flexible Spending Account (FSA)?

2. What is the benefit of an FSA to me and my family?

3. What kinds of FSAs are available to State of Florida employees?

4. What is a DCRA?

5. What expenses can be claimed for a child until the age of 13?

6. What is an MRA?

7. What is an LPMRA?

8. What is the difference between an FSA and an HSA?

9. How do I get one of these FSAs?

10. How much should I set aside?

11. I know I will have a major medical expense in January. Will an MRA still help me since I contribute all year?

12. Are there any risks to using the FSAs?

13. What are the eligibility guidelines for a Medical Reimbursement Account (MRA)?

14. What dependents are eligible for a Dependent Care Reimbursement Account (DCRA)?

15. What is the turnaround time for claims processing?

16. What do I need to do to be reimbursed?

17. Do I need to send original documentation with my reimbursement request form?

18. How do I submit claims?

19. Where can I get more forms?

20. When can I start submitting requests for reimbursement?

21. What is the last day to submit claims?

22. How often can I submit a claim?

23. How can I get a list of expenses that are eligible for reimbursement?

24. How can I check the status of my claim?

25. What is the mileage allowance for transportation to obtain medical care?

26. Is mileage for doctor visits reimbursable?

27. How do I submit mileage for reimbursement?

28. Is mileage reimbursable for visits to and from my local pharmacy?

29. Are expenses incurred for out-of-town healthcare services reimbursable?

30. Do I need to itemize my prescriptions on my reimbursement claim form?

31. How long does a direct deposit take to be posted to my FSA account?

32. What should I do if I closed my bank account or changed my bank account number?

33. Can I be reimbursed for prescription drugs purchased from a foreign country such as Canada?

34. How can I be reimbursed for orthodontia expenses?

35. Can I take the Federal Tax Credit and have a DCRA?

36. Is transportation related to a dependent's daycare reimbursable?

37. If my spouse loses employment, am I still eligible for a Dependent Care Reimbursement Account so my spouse can look for work or attend school?

38. If I have a Dependent Care Reimbursement Account, and my spouse loses employment and decides to stay home with our child so we don’t need a daycare, can I cancel my DCRA?


Answers

1. What is a Flexible Spending Account (FSA)?

FSAs, also called Reimbursement Accounts, are IRS-approved, tax-favored accounts that allow you to set aside part of your paycheck, before the state deducts taxes, to pay for certain medical expenses and/or dependent care expenses. You are then reimbursed from this account for eligible expenses. This allows you to save on income and Social Security taxes.

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2. What is the benefit of an FSA to me and my family?

Because the state deducts the money from your paycheck for your FSA before it deducts payroll taxes, you reduce your total taxable income. Additionally, you do not pay income tax on the reimbursements from your FSA when you use them to pay for eligible expenses.

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3. What kinds of FSAs are available to State of Florida employees?

You can choose from a:

  • Dependent Care Reimbursement Account (DCRA)
  • Medical Reimbursement Account (MRA)
  • Limited Purpose Medical Reimbursement Account (LPMRA)
If you have eligible dependents, you can have both a DCRA and an MRA/LPMRA. See the Tax-Favored Accounts Comparison chart for a summary of these reimbursement accounts.

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4. What is a DCRA?

Use this account for eligible dependent care expenses, such as daycare, you pay to take care of a qualified dependent. You use this account for dependent care expenses only, not health care expenses. The money accumulates in your DCRA account as it is deducted from your paycheck each pay period. Your DCRA account reimburses you only up to the amount available in your account.

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5. What expenses can be claimed for a child until the age of 13?

Expenses for a child in nursery school, pre-school, or similar programs for children below the level of kindergarten are eligible expenses for day care. You may also claim expenses for before- or after-school care of a child in kindergarten or a higher grade as long as the child is under the age of 13.

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6. What is an MRA?

Use this account for your out-of-pocket eligible medical, dental or vision services or products, as well as eligible pharmacy products. You must be enrolled in a Standard Health plan offered to state employees. Visit this website for partial lists of eligible health care expenses.

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7. What is an LPMRA?

You can use this account for only your eligible dental, vision and preventive care expenses not covered by your health plan. You must be enrolled in a Health Investor Health Plan and a Health Savings Account (HSA). Federal tax law allows you to have an LPMRA only if you have an HSA. Use the HSA for all other medical expenses.

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8. What is the difference between an FSA and an HSA?

You are eligible for an HSA only if you are enrolled in a Health Investor (high deductible) Health Plan, and you and your covered dependents do not have other health coverage. You can use the HSA to pay limited out-of-pocket expenses: medical and prescription drug costs, dental and vision services that are not covered under your insurance, deductibles and coinsurance —now or in the future. For active employees, the State of Florida contributes to your HSA (only when you open an HSA bank account at Tallahassee State Bank), and you can contribute additional money from your pre-tax wages. The state does not contribute to FSAs. Different than FSAs, if you leave state employment, you can take your HSA balance with you, and there is no annual deadline to use the funds in your HSA account.

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9. How do I get one of these FSAs?

    1. Enroll in the FSAs you are eligible to participate in as a new employee, during open enrollment or as the result of an appropriate Qualifying Status Change (QSC) event.
    2. Through payroll deduction, contribute pretax money to your account(s). Deductions begin in your first paycheck of the plan year.
    3. Pay out of pocket, or for eligible medical expenses, use your myMRA card beginning in January 2011.
    4. Submit claims and your FSA reimburses you for your eligible out-of-pocket expenses until you spend your designated funds.
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10. How much money should I set aside?

To open an FSA, you will need a minimum amount of $60. The maximum amount depends on your tax filing status. It'’s important to figure carefully how much you want to withhold from your paycheck and how much you will need for eligible expenses. See the Tax-Favored Accounts Guide to determine the maximum annual eligibility amount. Use the Reimbursement Account Estimator Tools to help you plan your flexible spending expenses for the year.

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11. I know I will have a major medical expense in January. Will an MRA still help me since I contribute all year?

Yes, the entire amount in your MRA is available at the beginning of the plan year (January 1), so you can use your debit card or submit a claim, even before the state withholds your regular contribution from your paycheck. Once you incur the expense, file your claim to be reimbursed. If you are a new employee, the MRA amount is available as of the date you enroll in the MRA.

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12. Are there any risks to using the FSAs?

FSAs are “use it, or lose it” accounts. You have from January 1 of the current plan year until March 15 of the next plan year to incur eligible expenses. Then by April 15 of that next plan year, you must submit all claims for all the money in your account. Any money you do not spend is not returned to you. It’'s important to figure carefully how much you want to withhold from your paycheck and how much you will need for eligible expenses. Use the Reimbursement Account Estimator Tools to help you plan your flexible spending expenses for the year.

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13. What are the eligibility guidelines for a Medical Reimbursement Account (MRA)?

You may be reimbursed for eligible health care expenses you and/or your qualifying dependents incur. Dependents include your:
  • Legal Spouse
  • Natural child, stepchild, eligible foster child, legally adopted child or child legally placed with you for adoption; children qualify from birth through the end of the calendar year in which they turn 26 as long as they:
    • Are not someone else's qualifying child
    • Are U.S. citizens, nationals or residents of the U.S., Mexico or Canada
    • Live in your household for more than half of the taxable year
    • Are younger than the taxpayer claiming such individual, and
    • Have not provided more than one-half of their own support during the taxable year.
      Note:There is no age requirement for a qualifying child if he is physically and/or mentally incapable of self-care. An eligible child of divorced parents is treated as a dependent of both, so either or both parents can establish an MRA.
  • Qualifying relatives, as long as they:
    • Are U.S. citizens, nationals or residents of the U.S., Mexico or Canada
    • Have the following specified family-type relationship to you son/daughter, stepson/stepdaughter, eligible foster child, legally adopted child or a descendant of any such individual (grand/great grandchild), brother/sister, niece/nephew, half-brother/sister, or stepbrother/sister, parent (or an ancestor of either), stepparent, aunt/uncle, certain in-laws (son-, daughter-, father, mother-, sister- and brother).
    • o Are not someone else’'s qualifying relative and receive more than one-half of their support from you during the taxable year

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14. What dependents are eligible for a Dependent Care Reimbursement Account (DCRA)?

You may use your Dependent Care Reimbursement Account (DCRA) to receive reimbursement for eligible dependent care expenses for qualifying individuals.

A qualifying individual includes a qualifying child if she:
  • is a U.S. citizen, national or a resident of the U.S., Mexico or Canada
  • has a specified family-type relationship to you
  • lives in your household for more than half of the taxable year
  • is less than 13 years old and has not provided more than one-half of her own support during the taxable year.
A qualifying individual includes your spouse if he:
  • is physically and/or mentally incapable of self-care
  • lives in your household for more than half of the taxable year and
  • spends at least eight hours per day in your home.
A qualifying individual includes your qualifying relative if she:
  • is a U.S. citizen, national or a resident of the U.S., Mexico or Canada
  • is physically and/or mentally incapable of self-care
  • is not someone else’'s qualifying child
  • lives in your household for more than half of the taxable year
  • spends at least eight hours per day in your home and
  • receives more than one-half of her support from you during the taxable year.
Note: Only the custodial parent of divorced or legally-separated parents can be reimbursed using the DCRA.

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15. What is the turnaround time for claims processing?

The normal turnaround time for reimbursement requests processing is five business days from the date a reimbursement request is received.

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16. What do I need to do to be reimbursed?

To process an MRA claim you must send:
  • A completed and signed Flexible Spending Account Claim form
  • A copy of an explanation of benefits (EOB), member health statement, bill or receipt showing the type of service, date of service and amount of service provided
  • If you use your myMRA card to pay for an eligible expense, you may be asked to submit documentation before your claim is approved. You should keep all documentation for myMRA card transactions
To process a DCRA claim you must send:
  • A completed and signed Flexible Spending Account Claim form
  • A copy of a receipt, invoice or bill from the provider showing the name and address of the provider , the beginning and ending dates of the provided services, the cost of the services, and the age, grade (if applicable) and name of the IRS-eligible dependent for whom the services were provided.

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17. Do I need to send original documentation with my reimbursement request form?

No. Copies of statements, bills, or receipts are sufficient, provided they have the required information.

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18. How do I submit claims?

Submit your itemized documentation, along with a claim form, to:

Mail:
People First Service Center Flexible Spending Accounts
P.O. Box 1800
Tallahassee, Florida 32302-1800

Fax:
Toll-Free Fax to: (888) 800-5217
Tallahassee Fax: (850) 425-4608

Online:
Or submit your scanned documentation online through People First. Click the FSA Information link then Online Claim Submission. Follow the directions and submission requirements.


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19. Where can I get claim forms?

Forms are available on this website under Forms and Publications and on the People First website under Health and Insurance, Benefit Materials.

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20. When can I start submitting requests for reimbursement?

Current employees can submit claims for services incurred as of January 1. New hires can submit requests incurred from their effective date (date of enrollment) forward.

For your MRA, the entire amount you elect to have deducted for the year is available for use on January 1. You don't have to wait for the cash to accumulate in your account.

For a DCRA, your claim is paid after the last date of the time period a claim has occurred based on the funds accrued in your account.


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21. What is the last day to submit claims?

You have a grace period to use services and/or purchase eligible medical and pharmacy products and claim them on the previous year'’s FSA. The grace period gives you until March 15 of each year to use the amount in your FSA from the previous year. Remember, you must also file previous plan year claims and any required documentation by April 15. Receipts with service dates after March 15 are applied to the current year'’s account.

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22. How often can I submit a claim?

You can submit claims as often as you incur expenses, or you can wait and send them in all at once. Remember, you must use your previous plan year’'s reimbursement account money by March 15 and file claims by April 15.

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23. How can I get a list of expenses that are eligible for reimbursement?

The Employee Benefits Institute of America Inc. (EBIA) Health Care Expenses Table is a helpful guide. It lists expenses that may be eligible for reimbursement. Log on to People First and click the FSA Information link in the My Quick Links section. Click “Eligible Expenses List” under Helpful Links. Seek guidance from a competent professional if you need tax or legal advice.

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24. How can I check the status of my claim?

Log on to People First and click the FSA Information link in the My Quick Links section to the left. Across the top of the web page are several tabs that show your FSA elections, balances, history and claims information. To track all open and current month paper claim reimbursements click the “Other Claims” tab. To view past month claims click “All Claims” in the drop down box. To view current year card transactions click the “my MRA Card Claims.” To view pending documentation click “Documentation Received in the drop down box.

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25. What is the mileage allowance for transportation to obtain medical care?

The standard mileage rate for use of an automobile to obtain medical care (as described in the 2012 IRS Publication 502) is 23 cents per mile.

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26. Is mileage for doctor visits reimbursable?

Yes, mileage is reimbursable as long as a receipt, statement or bill validating your doctor visit is sent along with your claim form requesting mileage reimbursement. In addition to mileage reimbursement at 23 per mile, you may seek reimbursement for parking and toll fees incurred as a result of travel for your medical appointment. To authorize your reimbursement request, please provide a receipt for the toll and/or parking fee in addition to a bill or receipt from your healthcare provider validating your doctor's visit.

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27. How do I submit mileage for reimbursement?

Calculate the mileage on the actual bill/receipt detailing the following: roundtrip mileage multiplied by the mileage rate for the time period of the mileage. Please include the name of the provider visited on the claim form. The amount allowed per mile is 23 cents per mile(as described in the 2012 IRS Publication 502).

Example of a claim: if your office visit with Dr. Jay resulted in a total of 80 miles roundtrip, write the mileage (80 miles x $0.23 = $18.40) on the bill/receipt from the provider. On your claim form, indicate "Mileage" under Provider of Services with the dates of travel and the correct dollar amount ($18.40) as the amount requested for reimbursement. Finally, attach your statement, bill or receipt that validates your visit to your reimbursement request.

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28. Is mileage reimbursable for visits to and from my local pharmacy?

Yes, a visit to your pharmacy for prescriptions will be treated as a visit to your local healthcare provider.

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29. Are expenses incurred for out-of-town healthcare services reimbursable?

You may include the medical expense amounts you pay for transportation to another city if the trip is primarily for, and essential to, receiving medical services, such as airfare and car rental. You also may be able to include the cost of lodging not provided in a hospital or similar institution. The amount of lodging cannot be more than $50 per night for each person. For example, if a parent is travelling with a sick child, up to $100 per night can be included as a medical expense for lodging. Meals are not included.

You cannot include in medical expenses a trip or vacation taken merely for a change in environment, improvement of morale, or a general improvement of health, even if you make a trip on the advice of a doctor.

(2012 IRS Publication 502, Pg. 15).

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30. Do I need to itemize my prescriptions on my reimbursement claim form?

Not necessarily, although some sorting on your claim form will help us expedite your claim. If you are submitting receipts for reimbursement of more than one person's prescriptions, please list all prescriptions by name. If you are submitting receipts for only one person's prescriptions, please itemize by provider (or pharmacy).

Example: Joe goes to his local pharmacy and fills five prescriptions: one for himself, two for his wife and two for his child. Joe will list himself, his wife and his child separately on the forms, but will add the prescriptions together for each person. Under "Dates of Service," Joe listed the first prescription as the start date and the last prescription as the end date.

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31. How long does a direct deposit take to be posted to my FSA account?

The standard turnaround time for deposit into your account is seven business days from the time People First transmits the entries.

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32. What should I do if I closed my bank account or changed my bank account number?

It is your responsibility to immediately update the Direct Deposit screen in People First with new account information. Log in to People First. Click “Employee Information then “Personal Information.” Select “Direct Deposit and complete the required fields.

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33. Can I be reimbursed for prescription drugs purchased from a foreign country, such as Canada?

In general, you cannot include in your medical expenses the cost of a prescribed drug brought in (or ordered shipped) from another country. You can only include the cost of a drug that was imported legally. For example, you can include the cost of a prescribed drug the Food and Drug Administration announces can be legally imported by individuals.

You can include the cost of a prescribed drug you purchase and consume in another country if the drug is legal in both the other country and the United States.

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34. How can I be reimbursed for orthodontia expenses?

Orthodontic treatment designed to treat a specific medical condition is reimbursable through your Medical Reimbursement Account if the proper documentation is provided:
  • a written statement, bill or invoice from the treating dentist/orthodontist showing the type and date the service was incurred, the name of the eligible individual receiving the service, the cost for the service and
  • a copy of the patient's contract with the dentist/orthodontist for the orthodontia treatment (only required if a participant requests reimbursement for the total program cost spread over a period of time). Reimbursement of the full or initial payment amount may only occur during the plan year in which the braces are first installed.
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35. Can I take the Federal Tax Credit and have a DCRA?

You cannot use the Federal Tax Credit and the DCRA for the same expenses. However, if you underestimate your DCRA contribution, the tax credit can be used for any remaining expenses up to the maximum allowed by the tax credit provisions. The amount reimbursed through your DCRA reduces dollar-for-dollar the amount that can be used to calculate the Federal Tax Credit. Because everyone’s' tax situation is different, please make sure you talk with your tax professional.

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36. Is transportation related to a dependent's daycare reimbursable?

Transportation expenses are reimbursable if they are for the purpose of transporting a qualifying individual to or from a place where care is provided as long as the dependent care provider furnishes the transportation.

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37. If my spouse loses employment, am I still eligible for a Dependent Care Reimbursement Account so my spouse can look for work or attend school?

Yes. If your spouse is either actively looking for work or is a full-time student, you are eligible for a DCRA.

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38. If I have a Dependent Care Reimbursement Account, and my spouse loses employment and decides to stay home with our child so we don’t need a daycare, can I cancel my DCRA?

Yes. Since you are no longer eligible to participate, you must call People First at (866) 663-4735 to stop deductions to your DCRA.

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