Important Information – Effective 1/1/11:

New legislation on over-the-counter purchases using FSA, HSA or HRA accounts.

The recently enacted Patient Protection and Affordable Care Act of 2010 changes the rules for the purchase of over-the-counter (OTC) products.

5 OTC changes for employers and employees to know:

1 Employees with an FSA, HRA, or HSA can no longer use their account funds to purchase OTC drugs and medicines (e.g. Advil, ibuprofen, cough syrup) unless they have a Note of Medical Necessity (NMN) or a prescription from their doctor.

2 If an employee has an NMN or a prescription for an OTC drug or medicine, they must pay at the point of service and submit a manual claim for reimbursement.

3 Employees can continue to use their FSA, HRA and HSA funds to purchase OTC items that are not considered a drug or a medicine (e.g. bandages, wound care, contact lens solution). Benefits cards can continue to be used for these purchases.

4 If an employee has questions about this OTC change or needs more information, they should call their Plan Administrator at the number on the back of their Card.

5 Employees should consider the new OTC rules when estimating the amount to put in their FSAs, HRAs or HSAs for the next plan year.

Additional Notes:

• IIAS merchants will be changing their OTC lists before or after the effective date of 1/1/11.
• The OTC change impacts those treated as 90% merchants, in that the calculation for who meets the 90% exception would be based on the new definition of eligible expenses, which excludes OTC drugs and medicines.
• After 1/1/11, if an OTC drug or medicine is purchased at a 90% merchant, a letter will continue to be sent.

The IRS has announced the 2012 Medical Mileage reimbursement rate will be 23 cents per mile.  The is a slight reduction from the late 2011 rate of 23.5 cents per mile.

You can use your Section 125 Health Care Reimbursement Account to be reimbursed any mileage costs associated with traveling to and from your medical appointments and services.  Simply track the starting mileage and ending mileage with a  brief outline of your trip.  Typically we find it is easiest to use a tool like Google Maps and print out a highlight sheet outlining your trip to and from your Doctor’s office.  From there, you can simply attach that with the documentation of your medical appointment on the standard Health Care Reimbursement form.

For 2012, ABS will reimburse the current IRS rate of 23 cents per mile!

ABS now partnering with FSA Store!

Advanced Benefit Strategies is excited to announce their partnership with FSAStore.

FSAStore is the one-stop destination for Flexible Spending Accounts.

With three main channels in their website, they help make purchasing FSA eligible items, finding local and eligible physicians, and finally answering the many questions that come along with having a Flexible Spending Account both simple and rewarding.

Click Here to go to the FSAStore now!

Browsing for FSA-eligible products and services has never been easier. The thousands of products listed at FSAStore are all FSA eligible and are clearly noted when any prescriptions will be required. See the FSA Eligible Product List for more information.

The services channel within the FSAStore portal will allow you to research the specialties that are FSA eligible as well as browse through a database of over 300,000 medical practictioners where you can use your FSA account.

Advanced Benefit Strategies and the FSAStore are here to make sure that participants have multiple channels of support. The FSAStore has made it possible to reach them via phone, online chat, and email for any questions regarding the FSAStore or product eligibility.

The informative site is available to make sure you are aware of the many positive FSA benefits available to you. Our goal is to simply help you make the most of your Flexible Spending Account and with our online partner at FSA store we are confident that we can do so.

In a surprise mid-year move, the IRS announced an across the board increase in mileage rates by 4.5 cents per mile.  Effective July 1st, 2011 mileage rates for use of an automobile to and from eligible medical services can be reimbursed at 23.5 cents per mile. 

Earlier this year we announced the 2011 mileage rate was increasing to 19 cents per mile.  This increase to 23.5 cents will be effective from July 1 2011 through Dec. 31 2011.  The 2012 rates have yet to be determined.

In light of the recent increases in the cost of the fuel, the IRS has made this special adjustment for the final months of the year.  Typically, the IRS updates the rates only once a year in late fall.  It is hoped this move will relieve some of the financial stress on working families. 

To use your Flexible Spending Account to be reimbursed for any mileage costs to and from your medical services, simply track the starting mileage and ending mileage with a  brief outline of your trip.  Typically we find it is easiest to use a tool like Google Maps and print out a highlight sheet outlining your trip from point A to point B.  From there, you can simply attach that as the documentation on the standard Health Care Reimbursement form.

The Family and Retirement Health Investment Act of 2011

Strengthening and expanding your HSA and FSA accounts!

This recently introduced bill in the U.S. Congress would modify and streamline rules for health savings accounts and flexible spending accounts to help participants.

• Allow a husband and wife to make catch-up contributions to the same HSA
• Remove the requirement that an individual have a physician’s prescription to obtain HSA or FSA reimbursement for OTC drugs
• Allow individuals to roll-over up to $500 from their FSA accounts
• Clarify the use of prescription drugs as preventive care that will not be subject to an HSA-eligible plan deductible
• Reauthorize the use of Medicaid health opportunity accounts
• Promote wellness by expanding the definition of qualified medical expenses to encourage more exercise and better diet
• Allow seniors enrolled in Medicare Part A to continue contributing to their HSAs
• Allow for the purchase of low-premium health insurance and long-term care insurance with HSA Dollars.

The Complete Bill can be found at Open Congress

CLICK HERE and Contact your Local Representative

or Senator to show support for this Bill!

Health Insurance: Changing Plans and the Future of Health Care

Tuesday, September 14                                            
CT Nonprofits, Hartford

9 a.m. – 10:45 a.m.

Members: Free, Nonmembers: $10 | Code:  HH1                                                                   

SESSION I:

How to get more out of your Health Insurance Plan

For organizations with 3-100 insurable employees

Not only are health Insurance plans changing rapidly, they’re also becoming more innovative and value-driven.  So how about you? Have health care changes affected your plan over the past two years?  How have you maximized the value of your plan?  Learn more about the range of health plan options available — from “traditional” co-play plans, to fully under-written self-insured plans.

SESSION II:

Health Care Power at Your Fingertips!

For organizations of all sizes, free to the community

Consumer Driven Health Care is here! It’s an exciting and innovative approach to managing health that gives you greater control, more convenience and additional cost savings. Learn more about the future of health benefits and how new consumer-centric tools and advocacy resources can help nonprofits take advantage of the latest technologies and health benefit solutions.

Learn more about…

- HealthSpan – A personal health resource portal that provides unlimited consultation and health resources 24/7

- Consult a Doctor – A virtual doctor’s office providing easy access and one-on-one consultation with Telemed-trained, U.S. Board certified doctors day and night.  Reduces office visits and co-pay expenses!

- Health Advocate - Guidance you can trust to help you navigate the health care gauntlet — with unbiased health information, eldercare assistance, medical record transfers,  insurance claim resolution and much more

- HealthMall – An online shopping portal providing discounts on hundreds of eligible health items purchased from popular retailers nationwide

- Wellness - A One-on-One assistance service that will help you achieve a healthier lifestyle.

Don’t Miss it!

IRS Releases Form to Help Small Businesses
Claim New Health Care Tax Credit
IRS Also Announces How Tax-Exempt Organizations Will Claim Credit

WASHINGTON –– The Internal Revenue Service today released a draft version of the form that small businesses and tax-exempt organizations will use to calculate the small business health care tax credit when they file income tax returns next year. The IRS also announced how eligible tax-exempt organizations –– which do not generally file income tax returns –– will claim the credit during the 2011 filing season.

The IRS has posted a draft of Form 8941 on IRS.gov. Both small businesses and tax-exempt organizations will use the form to calculate the credit. A small business will then include the amount of the credit as part of the general business credit on its income tax return.

Tax-exempt organizations will instead claim the small business health care tax credit on a revised Form 990-T. The Form 990-T is currently used by tax-exempt organizations to report and pay the tax on unrelated business income. Form 990-T will be revised for the 2011 filing season to enable eligible tax-exempt organizations –– even those that owe no tax on unrelated business income –– also to claim the small business health care tax credit.

The final version of Form 8941 and its instructions will be available later this year.

The small business health care tax credit was included in the Affordable Care Act signed by the President in March and is effective this year. The credit is designed to encourage small employers to offer health insurance coverage for the first time or maintain coverage they already have.

In 2010, the credit is generally available to small employers that contribute an amount equivalent to at least half the cost of single coverage towards buying health insurance for their employees. The credit is specifically targeted to help small businesses and tax-exempt organizations that primarily employ moderate- and lower-income workers.

For tax years 2010 to 2013, the maximum credit is 35 percent of premiums paid by eligible small business employers and 25 percent of premiums paid by eligible employers that are tax-exempt organizations. Beginning in 2014, the maximum tax credit will go up to 50 percent of premiums paid by eligible small business employers and 35 percent of premiums paid by eligible, tax-exempt organizations for two years.  The maximum credit goes to smaller employers – those with 10 or fewer full-time equivalent (FTE) employees –– paying annual average wages of $25,000 or less.

The credit is completely phased out for employers that have 25 FTEs or more or that pay average wages of $50,000 per year or more. Because the eligibility rules are based in part on the number of FTEs, and not simply the number of employees, businesses that use part-time help may qualify even if they employ more than 25 individuals.

smallgrouptaxcreditrequestform

Section 125 Medical Reimbursements for a non dependent adult child.

As referenced in The Patient Protection and Affordable Care Act of 2010 and effective retroactive to March 30, 2010. Coverage and reimbursements apply to a qualified child that has not attained the age of 27 by the end of the employee’s taxable year. The term “child” includes children, stepchildren, legally adopted children, children placed with the employee for adoption, and eligible foster children. For other types of dependents the meaning of “dependent” as defined in section 152 of the Code remains.

For the purpose of Section 125 HCR only:
Example: You have a daughter and she is age 25, you may submit the receipt for her prescription co- pay through your current Section 125 HCR plan. Her residency and/or marital status do not matter only her age is taken into consideration.

Aetna Report, April 2010

Annual health care spending in the United States is estimated to surpass $4.2 trillion in 2018, up from $2.5 trillion in 2009 and $75 billion in 1970. Such spending accounts for 17% of GDP currently and is expected to reach 19% in 2018.¹

Many consumers and small employers are struggling to afford their health insurance premiums. High costs have fueled an uninsured rate of 15.4% with 46.3 million uninsured.² About 56% of the uninsured are ineligible for public programs and cannot afford coverage, while another 25% are eligible for public programs but not enrolled.³

For many employees, the growth in health care premiums is displacing wage increases. For other employees, high health care costs mean their employers cannot offer coverage at all. For firms with less than ten employees, only 46% offer coverage to their workers.⁴

¹Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group. www.cms.hhs.gov/NationalHealthExpendData/; Historical data from CY 1960-2008; Projected data from NHE projections 2009-2018.

²US Census Bureau Health Insurance. “Current Population Survey, Annual Social and
Economic Supplement, 2009” (September 2009). www.census.gov/hhes/www/hlthins/hlthins.html

³Dubay, Lisa, et al (2006) “The Uninsured and The Affordability of Health Insurance Coverage” Health Affairs.

⁴Kaiser Family Foundation and Health Research & Educational Trust (HRET). “Employer Health Benefits – Annual Survey 2009” (September 2009). ehbs.kff.org/pdf/2009/7936.pdf

After you Access your Personal Account you can view two plan years by clicking on the link “Switch Plan Years”.