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NEA Insurance FSA

Using Your Flexible Spending Account Wisely
By Clark M. Merkley, Teacher - Springville Junior High School, Member - Nebo District Insurance Committee.

What is the Flexible Spending Account? The Nebo School District has established Flexible Spending Account (FSA) plans for its employees - one for health care expenses and one for dependent care expenses. The FSA allows you to pay for eligible expenses on a PRE-TAX basis, such as co-payments, deductibles, orthodontia, prescription and most over-the-counter medications, dependent care, and certain non-covered medical services.

How Does the FSA Benefit Me? The FSA saves you money by reducing your income taxes. The contributions you make to an FSA are deducte4d from your pay BEFORE your Federal, Utah State, or Social Security Taxes are calculated. The end result is that you decrease your taxable income and can save hundreds of dollars a year if you plan carefully. For example, a person who earns around $30,000 a year could save as much as $1,200 in taxes.

How Does the FSA Work? Each year, whether you have been enrolled in the FSA before or not, you must enroll to be eligible for this benefit. Please watch for the Nebo District Bulletin and flyers in your school with more information about the open enrollment period. On the enrollment form, you will be asked how much money you want to contribute to the health care FSA and the dependent care FSA for the year. The amount you designate for the year is taken out of your paycheck in equal installments each pay period and placed in a special account administered by the Utah School Boards Association, USBA Flexible Spending program. As you incur expenses you are reimbursable under the FSA, you pay the bills out of your own pocket and then submit a copy of the Explanation of Benefits or the provider's invoice to USBA Flexible Spending, who willthen issue you a reimbursement check. You must use the form provided by USBA (forms are available in the Nebo District Payroll Office) to submit claims. Once you have submitted your first claim, USBA will send you an additional form for your next claim. Also, once you are enrolled, you can log-in to the USBA Flexible Spending website for on-line administration features.

One important thing to know about the FSA Plan: If you don't spend the full amount in your account each year, you lose it. So it's crucial to put aside only as much money as you know you'll use. While the money itself doesn't have to be distributed to you before Dec. 31st -- the IRS allows a 90-day period into the next year for the bills to be submitted for payment -- the treatment must be within the same calendar year as your contributions. So, if you are already an FSA participant and have unused funds in hyour FSA, you should start scheduling appointments, buying eyeglasses or getting those treatments so that you can complete them by the end of the year and not lose any of your funds.

What Expenses Are Eligible for Reimbursement? Any expense that is considered a deductible medical expense or a qualified child care expense by the Internal Revenue Service and is not reimbursed through PEHP or other insurance can be reimbursed through the FSA. Examples include:

  • Fees paid to doctors, dentists, surgeons, chiropractors, psychiatrists, psychologists
  • Contact lenses and eyeglasses
  • Fees for hospital services, qualified long-term care services, accident and health, and qualified long-term care insurance premiums, nursing services, laboratory fees, prescription medicines and drugs, and insulin
  • Smoking-cessation programs and prescribed drugs to help nicotine withdrawal
  • False teeth, hearing aids, crutches, wheelchairs, and guide dogs for the blind or deaf
  • Fees in excess of reasonable and customary amounts allowed by your insurance
  • Non-elective cosmetic surgery
  • Co-payments on covered expenses
  • Deductibles
  • Braces
  • Prescription drugs or prescription co-payments and most over-the-counter drugs.

To obtain a complete list of eligible medical expenses, get IRS Publication 502 or see it online at http://www.irs.gov/publications/
p502/index.html.

How Do I decide How Much to Contribute to My FSA? It's important to give some thought to calculating how much money to contribute for the year. To determine how much to contribute, make a list of the expected out-of-pocket medical expenses for you and your dependents for the next year. If you always exceed your deductible, include the deductible amount in your calculation. Be conservative so you don't risk forfeiting any money, but plan carefully to get the maximum tax benefit.

For more impormation about enrolling in the Nebo District Flexible Spending Account plans, please call Kim, Marie or Kathy in the Payroll Office at 354.7431 or go to the USBA Flex.com website at http://www.usbaflex.com/index.htm.

Insurance Reminders from Roberta Merrill (roberta.merrill@nebo.edu)

Teresa Shields from PEHP is at the district office on the first Thursday of every month from 3 p.m. to 5 p.m. to help with specific insurance questions and claims problems.

Remember to take your insurance cards with you when receiving medical benefits. Those on the Summit plan have a separate card for each enrolled person. (This can be somewhat annoying, but it's very handy for college age children who live away from home.) Remember that your pharmacy card is different from your medical benefits card. Your pharmacy card says "Medco" at the top.

Remember to use Flexible Spending Accounts to use pre-tax dollars for out-of-pocket medical and child care expenses. If you don't know how to use a Flex Spending Account, please, please find someone to explain it to you and get started. To research Flex Spending on your own go to the PEHP web site (pehp.org) and check out the link on the home page that says FLEX$ on the left side menu. Remember to use your insurance dollars wisely. We are self-insured--what doesn't get used, we get to keep.