HealthEquity Flexible Spending Accounts

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1 HealthEquity Flexible Spending Accounts Plan Year: January 1, December 31, 2018 Medical Flexible Spending Account Maximum: $2,600 Dependent Care Account Maximum: $5, Save money with an FSA Flexible Spending Accounts Save money on health care expenses Did you know that you can save money on your health care costs when you choose to enroll in your employer s Flexible Spending Account (FSA) plan? An FSA is an account that allows you to set aside a portion of your income each year on a pre-tax basis so you can pay for qualified health care expenses with tax-free dollars. Because the money you contribute is deducted from your paycheck before taxes and the withdrawals are tax-free, your FSA can mean significant savings. 1 Your money goes further in an FSA A $1,000 contribution to your FSA could save you as much as $300 or more. 2 Taxed dollars in your checking account Your contribution $1,000 Pre-tax dollars in your FSA Your contribution $1,000 Taxes $300 Taxes $0 Available for medical expenses $700 Available for medical expenses $1000 Save on qualified medical expenses You can use the tax-free dollars in your FSA for any qualified medical expense, for example: + Copayments for doctor visits + Health plan deductibles and coinsurance + Prescriptions + Dental and orthodontic care + Hearing aids + Eyeglasses, contact lenses, laser eye surgery With a medical FSA, your contribution is deducted from your paycheck in equal amounts over the course of the year, but your full year s contribution is available to you from day one. So you know you ll have the money when you need it. What s more, employers can now, with certain restrictions, allow employees to carryover unused FSA balances up to a maximum IRS-prescribed amount. Please consult with your benefits administrator for additional details. NEED MORE INFO? To learn more about the details of your employer s FSA plan and to sign up contact your group benefits administrator. Save on dependent care, too Your employer may also offer a separate FSA for dependent care. With a dependent care FSA, your contribution is deducted from your paycheck in equal amounts over the course of the year. You can contribute pre-tax dollars to this FSA to help pay the costs of day care for a child or elder care for a parent and as with a medical FSA, withdrawals are tax-free. 1 However, only the funds actually on deposit are available for withdrawal. PAGE 1 of 2 6

2 24/7/365 Expert support specialists are available for members every hour of every day Helpful tools and support along the way Once enrolled, you ll receive a welcome kit in the mail from HealthEquity, BCBSNC s partner in FSA administration. This kit contains information and instructions for accessing your account. With HealthEquity, you ll have convenient and comprehensive tools and resources to manage your account including expert specialists who are available every hour of every day to share advice and answer your questions. Managing your FSA You can manage both your BCBSNC health plan and your FSA account online and on-the-go. Visit mybcbsnc.comm to view your health benefits and claims and to check your FSA fund balance. Click on the Manage Your FSA link for access to comprehensive online services. You also have on-the-go access to your FSA on your mobile device with the HealthEquity mobile application available for iphone and Android devices. Here s what you can do + View account balance and history + Create new claims and view status + Send payments and reimbursements + Manage debit card transactions, if applicable + Archive documents on our secure serversrs + And with the new mobile app, you can do all this on the go, plus use your device s camera to document and upload claims 1 Withdrawals are tax-free only if used for qualified medical expenses or dependent care costs. Specific regulations and a list of qualified medical expenses can be found in IRS publication 502, available at 2 Example based on a combined state and federal tax rate of 30%. Your specific tax rate and savings may differ. Blue Cross and Blue Shield of North Carolina (BCBSNC) is the HRA/FSA administrator and contracts with HealthEquity, Inc., an independent entity, to perform certain HRA/FSA administrative services. Blue Cross Blue Shield and the Cross and Shield Symbols are registered service marks of the Blue Cross and Blue Shield Association, an association of independent Blue Cross and Blue Shield Plans. All other marks are the property of their respective owners. Blue Cross and Blue Shield of North Carolina is an independent licensee of the Blue Cross and Blue Shield Association. U7471, 12/13 PAGE 2 of 2 7

3 FSAs: a simple way to save Flexible spending accounts (FSAs) EMPOWERING you TO BUILD HEALTH SAVINGS It s easy to save with an FSA 8

4 Why FSAs? A simple way to save Significant savings $1000 $500 $500 out-of-pocket medical expenses out-of-pocket vision expenses out-of-pocket dental expenses $800 tax savings $1000 $1000 $5000 out-of-pocket medical expenses vision and dental expenses child care expenses $2800 tax savings HealthEquity All rights reserved. 9

5 FSA options Health care FSA Health care FSA limits Dependent care FSA or DCRA 014 HealthEquity All rights reserved. Limited-purpose FSA (LPFSA) 10

6 How an FSA works FSA Eligibility 1. SIGN UP 2. CONTRIBUTE 3. USE YOUR FUNDS Use it or lose it! HealthEquity All rights reserved.

7 FSA insight OTHER QUALIFIED USERS DENTAL EXPENSES VISION EXPENSES OVER-THE-COUNTER MEDICINE reserved. ARCHIVE YOUR RECEIPTS ONLINE 12

8 Qualified expenses Hearing aids Non-qualified expenses l rights reserved. 13

9 A tax-saving solution for dependent care Dependent Care Reimbursement Account Why DCRAs? A Dependent Care Reimbursement Account (DCRA) is a great way to pay for dependent care with tax free dollars. And since you contribute to a DCRA through a payroll deduction, you also reduce your taxable income. To qualify, the dependent care must be essential for you and your spouse to work, look for work, or attend school full-time. How it works With a DCRA, you are able to make pre-tax payroll contributions to pay for dependent care expenses. + Determine the amount you would like to contribute for the year. The maximum annual DCRA election allowed is $5,000 per household. Unlike medical flexible spending accounts, your annual DCRA funds aren t available up-front. Funds are only accessible as they are deposited with each payroll deduction. + Pay dependent care costs out-of-pocket. + Submit expenses either through the online member portal, or by using the DCRA Reimbursement form. Recurring dependent care claims can be scheduled for the duration of the plan year. For assistance, contact customer service at Qualified dependents To be considered qualified, dependents must meet the following criteria: + Children under the age of 13 + A spouse who is physically or mentally unable to care for him/ herself + Any adult you can claim as a dependent on your tax return that is physically or mentally unable to care for him/herself Eligible expenses* + Babysitter inside or outside household + Before and after school or extended day programs + Custodial childcare or eldercare expenses + Day camps + Daycare centers + Household employee whose services include care of a qualifying person + Looking-for-work expenses + Nanny expenses + Preschool/nursery school for pre-kindergarten + Sick-child care center + Summer day camps Ineligible expenses* + Educational/tuition expenses + Expenses paid to child of participant + Field trip expenses + Food, clothing, education or entertainment expenses + Household services + Incidental expenses + Overnight camps + Payments for care where you are not the custodial parent + Payments for care while on a leave of absence, or while on maternity, or other medical leave + Payments for care while you are on vacation or due to illness + Payments for services not yet provided *See the complete list of qualified and non-qualified expenses in IRS Publication 503 Child and Dependent Care Expenses. Don t Forget! DCRA funds do not roll over from year to year. You must use DCRA dollars within the plan year or they will be forfeited. Be sure to save all receipts, which are required for reimbursement and validation of expenses. PAGE 1 of 2 14

10 24/7/365 Expert support specialists are available for members every hour of every day Helpful tools and support along the way Once enrolled, you ll receive a welcome kit in the mail from HealthEquity, BCBSNC s partner in DCRA administration. This kit contains information and instructions for accessing your account. With HealthEquity, you ll have convenient and comprehensive tools and resources to manage your account including expert specialists who are available every hour of every day to share advice and answer your questions. Managing your DCRA You can manage both your BCBSNC health plan and your DCRA account online and on-the-go. Visit mybcbsnc.comm to view your health benefits and claims and to check your DCRA fund balance. Click on the Manage Your DCRA link for access to comprehensive online services. You also have on-the-go access to your DCRA on your mobile device with the HealthEquity mobile application available for iphone and Android devices. Here s what you can do + View account balance and history + Create new claims and view status + Send payments and reimbursements + Archive documents on our secure servers + And with the new mobile app, you can do all this on the go, plus use your device s camera to document and upload your DCRA claims and receipts NEED MORE INFO? To learn more about the details of your employer s DCRA plan and to sign up contact your group benefits administrator. Blue Cross and Blue Shield of North Carolina (BCBSNC) is the DCRA administrator and contracts with HealthEquity, Inc., an independent entity, to perform certain DCRA administrative services. Blue Cross Blue Shield and the Cross and Shield Symbols are registered service marks of the Blue Cross and Blue Shield Association, an association of independent Blue Cross and Blue Shield Plans. All other marks are the property of their respective owners. Blue Cross and Blue Shield of North Carolina is an independent licensee of the Blue Cross and Blue Shield Association. U7471d, 11/13 PAGE 2 of 2 15