Frequently Asked Questions

Transcription

1 Frequently Asked Questions For Associates Flexible Spending Account (FSA) Basics What is a Flexible Spending Account (FSA)? An FSA is an account that you can use to set aside money on a pre-tax basis to cover eligible expenses throughout the year. There are three types of FSAs: Health Care FSA; Limited FSA; and Dependent Care FSA. Each account type has different rules regarding eligible expenses. What is the difference between a Health Care FSA and a Limited FSA? Funds in a Health Care FSA can be used to pay for eligible medical, vision, pharmacy and dental expenses. Funds in a Limited FSA can be used to pay for eligible vision and dental expenses only. What is a Dependent Care FSA? Funds in a Dependent Care FSA can be used to pay for eligible childcare expenses (for children up to age 13) and adult day care expenses in order to allow you (and your spouse, if applicable) to work or attend school.. This account cannot be used to pay for any medical, vision, pharmacy or dental expenses. Are there any requirements to qualify for an FSA? Yes. All associates who are eligible for medical coverage (through Macy s, Inc.) are eligible for the Health Care FSA. The Limited FSA is available to all regular FT and PT-20 associates. The Dependent Care FSA is only available to regular full-time associates. Are there any situations that would prohibit me from having an FSA? Yes. If you are enrolled in a Health Savings Account (HSA) with a Cigna My Choice Plan medical option, you are not permitted to enroll in a Health Care FSA. However, you may choose to enroll in a Limited FSA to pay for eligible dental and vision expenses. Please note, your HSA may also be used to pay for eligible dental and vision expenses. Please see the FSAs and Health Savings Accounts (HSA) section for additional details. How does an FSA work? When you enroll in an FSA, you choose the amount you want to contribute for the year (subject to IRS limitations). You will then contribute those funds each pay period on a pre-tax basis. However, with a Health Care or Limited FSA, you have access to the entire balance for the Plan year as soon as your FSA is established; you do not have to wait for each of your payroll deductions to access the funds. If you enroll in a Dependent Care FSA you must wait for the funds to accumulate from your payroll deductions before you can use the account. What can I spend my FSA dollars on? What is a eligible expense? Eligible expenses vary depending on the type of FSA in which you enroll. You can find a listing of eligible expenses at 1

2 Do I need to enroll in an FSA each year during Annual Enrollment? Yes. You will not be automatically enrolled in an FSA, nor will deductions continue, if you do not enroll in an FSA during Annual Enrollment. However, if you have carry-over funds, you will have access to those funds after the prior Plan year s run-out period. For more information, please review the Carry-over Information section of these FAQs. Getting Started with your FSA When is my FSA effective or open? Your FSA becomes effective the same date as your medical coverage effective date. Can I use my Health Care FSA or Limited FSA funds to pay for my spouse or dependents eligible expenses even if my spouse or dependents are not enrolled in a Macy s, Inc. medical option? Yes, as long as your dependents are eligible to be covered by Macy s, Inc. medical options. How much can I contribute to my FSA? The amount varies based on the type of account and your status. For the Health Care FSA and Limited FSA, associates may contribute up to $2,600 for the Plan year if your account is effective on Jan. 1, 2017 or later. For Dependent Care FSA, most eligible associates may contribute up to $5,000 for the Plan year. However, highly compensated associates are limited to a contribution of $1,000 for the Plan year. How do I access my FSA to pay for eligible expenses? For a Health Care FSA or Limited FSA you may use your Cigna FSA debit card to pay for your eligible expenses. It is important to keep receipts for all charges in order to substantiate any claims for which Cigna may need additional information. You may also submit a claim for reimbursement through For a Dependent Care FSA, you may submit a claim for reimbursement on or use the claim form located on the Benefits Forms page (in the My Benefits section of My IN-SITE). If you have questions, contact Cigna for additional information and instructions. Can I change my FSA contributions during the Plan year? No. Internal Revenue Service (IRS) guidelines prohibit changing FSA elections unless you experience a eligible change in status (these vary by the type of FSA). If you have questions about FSA changes and eligible changes in status, please call HR Services at MACY (6229). How am I notified of Health Care and Limited FSA claims that I need to substantiate? If you have any unsubstantiated claims, you will receive communication from Cigna. To check to see if you have any unsubstantiated claims, call Cigna at or view your account online at Simply select "Manage Claims & Balances" then select your FSA account. You have until Sept. 30 each year (the end of the claim run-out period) to substantiate claims. FSAs and Health Savings Accounts (HSA) Can I have an FSA and an HSA? It depends on the type of FSA. The IRS prohibits you from having an HSA and a Health Care FSA. However, if you have an HSA, you may have a Limited FSA and/or a Dependent Care FSA. 2

3 How is a Health Care FSA different from an HSA? Both accounts allow you to set aside money on a pre-tax basis to help pay for out-of-pocket eligible medical, dental, prescription and vision expenses. However, there are some differences (highlighted in the chart below): Account Feature Health Care FSA HSA Tax-advantaged account for eligible medical expenses Money can be deposited from an associates paycheck before tax Carry-over of unused funds to the next plan year (up to $500) Claim Substantiation Annual pledged amount available immediately Portable beyond time at Macy s, Inc. Investment options (tax-free) Earns Interest (tax-free) Company Contribution I have both a Limited FSA and an HSA, will I have two separate debit cards? Yes. You will receive different debit cards for each account. The Limited FSA card is called the Health Care Debit Card and the HSA card is called the Choice Fund Health Debit Card for your Health Savings Account. It is important to remember that if you have a Limited FSA, your card will still say Health Care Debit Card but you can only use it on eligible vision and dental expenses. Cigna is your point of contact for all FSA and HSA accounts. Your Health Care FSA/Limited FSA card: Your HSA card: FSAs and Health Reimbursement Accounts (HRA) Can I have an FSA and an HRA? Yes. You may have an HRA and any type of FSA you are eligible to enroll in. There are no limitations on your FSA if you are enrolled in an HRA. 3

4 FSA Carry-over Information Are FSA funds allowed to be carried over to the next Plan year? It depends on the type of account. Internal Revenue Service (IRS) guidelines allow up to $500 of remaining Health Care or Limited FSA funds to be carried over from one Plan year to the next. This is to help minimize your contributions being forfeited. However, to roll over remaining funds you must have at least $25 remaining in your account when the prior Program year run-out period ends on September 30 th. Dependent Care FSA funds will not be carried over and any funds remaining in the account after Sept. 30 of the next Plan year will be forfeited. Is there a minimum amount required for carry-over? Yes. To roll over remaining funds, you must have a minimum of $25 in your account when the prior Program year run-out period ends on September 30 th. What is the maximum amount that will be carried over? Associates can carry over unused funds from $25 to $500. What happens if I have over $500 in my account at the end of the Plan year? All unused funds remaining after $500 has been carried over will be forfeited. For example, if you have $600 of unused funds remaining in your account after the claim run-out period, $500 will carry over and you will forfeit the remaining $100. What is the claims run-out period? If you have any claims incurred from July 1 to June 30 of the previous Plan year, that you have not previously submitted or substantiated, you have until Sept. 30 to submit or substantiate them; otherwise, at that time, all leftover funds over $500 will be forfeited. Any unsubstantiated claims remaining will require you to reimburse the Plan for the expenses previously paid on your behalf When will the carry-over funds be available for use? Carry-over funds will be available for your use in the fall of the next Plan year. If I have unused Health Care or Limited FSA funds, what do I have to do to have the funds carried over? You do not have to do anything. Cigna will assess your account and will automatically carry over all unused funds from $25 to $500 into the appropriate account type at the end of the claim run-out period. These funds will be made available for you to use in the fall, and can be used for claims incurred during the current July 1 through June 30 Plan year. What happens if I elected a Live Healthy My Choice Plan medical option with an HSA? Will I still receive my carry-over funds? Yes, regardless of whether you had a Health Care or Limited FSA during the previous Plan year, if you enroll in a My Choice Plan medical option, you will receive your carry-over funds in a Limited FSA for the current Plan year. You can use Limited FSA funds to pay for qualified dental and vision expenses. 4

5 What happens if I did not elect a Health Care or Limited FSA for the current Plan year, but I have carry-over funds? If you did not make a Health Care or Limited FSA election for the current Plan year, your carry-over funds of $25 to $500, from the previous Plan year, will be available to you in the fall. However, you will not be able to submit any claims for reimbursement until the carry-over funds are available. Please keep this in mind because you will need to pay out-of-pocket for any expenses incurred, and wait until you receive the carry-over amounts to submit claims for reimbursement. If I did elect a Health Care or Limited FSA for the current Plan year, and I also have remaining unused funds, when will the funds be available to use? As usual, you can use the funds you elected for the current Plan year beginning July 1, via your debit card or you may submit your claims manually. Please note that if you use your debit card, you should keep your receipts as you may need to substantiate your claims with Cigna. However, your carry-over funds cannot be used until the funds have been transferred into your account in the fall. If you use all of your elected contribution amount for the current Plan year and prior to your carry-over amount being made available, your debit card will be de-activated until your carry-over funds are available. After that time, you may submit claims for reimbursement for expenses incurred between when you exhausted your current Plan year contribution amount and the date your carry-over funds are made available. What happens if I changed my election to a Limited FSA instead of Health Care FSA (or vice versa) for the current Plan year? If you changed your election from a Health Care FSA to a Limited FSA (or vice versa) for the current Plan year, your carry-over funds of $25 to $500 will be available in your FSA in the fall, subject to the restrictions of the current account. However, you will not be able to submit any claims to use your carry-over funds until they have been made available. Please keep this in mind because you will need to pay out-of-pocket for any expenses incurred, and wait until you have received your carry-over funds to submit claims for reimbursement. What happens to my carry-over funds if I leave the Company? If you leave the Company and have underspent your current Plan year election, you may elect COBRA, and you will still have access to your carry-over funds. What happens if I don t use my carry-over funds in the current Plan year? If you elected a Health Care or Limited FSA election for the current Plan year, your carry-over funds will continue to carry over to the next Plan year. If you did not elect a Health Care or Limited FSA for the current Plan year, you must use at least some of your carry-over funds during the Plan year or your account will be deemed inactive and the funds will be forfeited at Plan year end. You are not required to use the entire carry-over amount, simply a portion of it to show the account is still active. Can I access my carry-over via my debit card? Yes. However, your carry-over will not be available until the fall. 5

6 FSA and Leaving the Company When would my FSA coverage end? Your contributions and participation will end at the end of the pay period in which your separation date falls. Please contact Cigna regarding availability of any carryover funds for which you may be eligible. Could I elect to continue my FSA? If you have not yet claimed all the funds you contributed, including any carry-over funds, you may be eligible to elect FSA or Limited FSA continuation coverage through the end of the Plan year, via COBRA. ADP, the Macy s, Inc. COBRA administrator, will mail you information on FSA/LFSA continuation coverage if you are eligible. Although ADP administers the election and billing process, Cigna will continue to handle the processing of your claims. You cannot elect to continue your Dependent Care FSA. This account will close at the end of the pay period in which your separation date falls. What would it cost to continue to participate in an FSA or Limited FSA? If you elect to continue your FSA or Limited FSA coverage through the end of the Plan year, you must contribute the amount remaining toward your current Plan year pledge, plus a 2% administrative fee. All contributions will be after tax. Could I continue to use my FSA or Limited FSA debit card? No. Your debit card will be deactivated as of your separation date. If you elect to continue FSA or Limited FSA coverage you will be required to submit claims manually for eligible expenses. You can find the correct forms and instructions at References and Tools Where do I go online to access my account? Go to to access information about your FSA. Select the correct FSA from the Review My Coverage section. You can: track your account balance monitor account activities submit a claim for reimbursement access online statements set up or text alerts and more! How do I order a replacement debit card? Call Cigna at to request an additional card. The second card is complimentary; any additional cards cost $6 each. Where can I go if I have more questions about my FSA? Please contact Cigna by visiting Cigna s website, checking out Cigna s mobile app, or calling Cigna at Where can I find out more about a Dependent Care FSA? Visit the Dependent Care FSA page under Enjoy Life in the My Benefits section of My IN-SITE. 6