4 Key Messages for Employees with FSAs and HRAs Before the End of the Year
If an employer plan wraps up at the end of the year (on Dec. 31, 2021), it’s important to make sure your team members with a flexible spending account (FSA) or health reimbursement account (HRA) know they’ll need to spend down their balance. Otherwise, they’ll lose any remaining money they’ve set aside when the new year starts.
As you’re preparing fall communications around spend down, here are a few key messages to share with employees to make sure they know how best to manage their FSA or HRA at the end of the year.
Know the deadlines
In addition to reminding employees of the upcoming end of the plan year, benefits leaders should be sure to identify any grace period or rollover options that were offered for FSAs or HRAs. While the IRS doesn’t require plans to offer these options, employers may have chosen to allow employees to rollover unused funds between plan years or offer a grace period to spend down the previous year’s balance.
The Consolidated Appropriations Act of 2021 also has several COVID-19 relief regulations about grace periods and rollovers that businesses can opt into:
- Plans may allow team members to completely rollover over all unused funds from 2021 to 2022, rather than only a $550 maximum.
- Plans may offer a 12-month grace period to spend down 2021 account balances instead of only 2.5 months.
If an employer has opted into one of the above regulations, they should be sure to alert employees of the changes and revised deadlines due to the coronavirus pandemic.
Share a list of eligible expenses
While a health spending account covers a variety of medical expenses, employees might need a reminder of what’s on the eligibility list as they spend down their account at the end of the year.
If you offer an HRA, the employer group determines what products and services are eligible for reimbursement, so benefits administrators should be sure to share the approved list with employees.
If you offer an FSA, a full list of eligible expenses can be found here. A few eligible health care costs that can help employees spend down their 2021 account balances include:
- Flu shots
- Prescription or reading glasses
- Over-the-counter cold and flu medicine
- Feminine hygiene products
- Dental procedures (e.g. X-rays, fillings, extractions, crowns, implants)
- Immunizations
What documentation to keep
Employees should keep good records of their health care expenses because they’ll need to provide proof of purchase or medical service to request reimbursement from their FSA or HRA.
Here’s a checklist to share with employees so they know what information to keep handy for reimbursement claims:
- Date of service or purchase
- Name of the person who received service or supplies
- Name of the service or supply provider
- Type of service or supplies you purchased
- The amount you were charged for service or supplies, or the amount that was not reimbursed by your insurance provider
How to submit for reimbursement
If an employee doesn’t use their spending account often, they might need a refresher on how to submit reimbursements at the end of the year.
Let account holders know that Further offers several easy ways to request a reimbursement:
Website
Employees can log onto their account at www.hellofurther.com to submit a claim. Plus, if they set up direct deposit, reimbursement funds will go directly to their checking accounts.
A helpful resource to share with employees is Further's step-by-step instructions and a video tutorial on submitting online reimbursements.
Mobile App
Account holders can access their Further account from anywhere using our app, which can be downloaded from the Apple or Google Play Store. Users can tap “Get Reimbursed” and follow prompts to submit a claim from their mobile device.
A helpful resource to share with employees is Further's article: how to register an account and use a mobile app.
By Mail
If employees are more comfortable mailing in a reimbursement claim, Further also offers this option. They’ll need to fill out a claim form (see link below) and mail it to our team. Note: Account holders should be aware that this method will take longer to receive reimbursement funds than an online or mobile claim.
A helpful resource to share with employees is Further's Medical Expense Claim Form.
The Further Learning Center offers a variety of additional resources to help understand FSAs and HRAs. Further’s Member Services team is also available to answer questions at 800-859-2144 or via email at [email protected].
