Two Account Options
HCFSAs cover unreimbursed healthcare costs, like deductibles or copayments.
Dependent Care Accounts help cover the cost of caring for a qualifying child, relative, or spouse to allow an employee to continue working.
Payroll Tax Savings
While FSAs are a great way for employees to save money, employers may also see payroll tax savings added to their bottom lines.
For HCFSAs, upon receipt of a claim, the entire amount of the participant’s annual election (less previously paid claims) will be available. This is regardless of the participant’s contribution.
Benefits Debit Card
This card eliminates up-front payment and may be available at no additional cost. When a participant has an allowable expense, he or she uses the Benefits Debit Card, and the out-of-pocket portion of the expense will be deducted straight from his or her HCFSA account.*
Uniform Coverage Risk
Regulations require the HCFSA to have the full elected amount available to a participant for reimbursement from the first day of the plan year. This causes a potential loss to the employer. American Fidelity offers insurance to cover the HCFSA risk. The risk policy “insures” the employer’s uniform coverage risk for the HCFSA, up to $2,600 (or $2,650 for plan years after 2017) per participant, for shortages in the plan after the coverage period.
*The Internal Revenue Code (IRC) requires proof of the eligible expenses using itemized receipts or other documentation showing the date of service, person for whom the service was provided, and a description of the expense. Depending on the type of expense, documentation may come in the form of third party itemized statements or an Explanation of Benefits (EOB).