May 18, 2023
FSAs and HSAs come with a myriad of compliance rules. In this webinar, the Benefits Compliance team provided a review of the basic rules and nuanced issues surrounding these reimbursement arrangements.
Agenda
Health Flexible Spending Account (FSA) and Health Savings Account (HSA):
- Overview
- Eligibility
- Contributions
- Distributions
- FAQs and Compliance Nuances (throughout)
- Final Takeaways
Key Takeaways
FSA Compliance Takeaways
- FSAs can provide significant tax savings to employees and employers.
- FSAs are employer-sponsored group health plans.
- ERISA, COBRA, FMLA, HIPAA privacy rules generally apply.
- Employers determine eligibility requirements and should keep the ACA's "Footprint Rule" and Section 105 and 125 nondiscrimination rules in mind.
- Employers should be mindful of the Uniform Coverage Rule.
- Participants should be mindful of the "Use-or-Lose" Rule, as well as grace periods or carryover options, if any.
- Employers and employees should understand the impact of FSA coverage on HSA eligibility.
HSA Compliance Takeaways
- HSAs also have great tax advantages and can help employees to pay for qualifying medical expenses.
- Employees own accounts and are ultimately responsible for complying with eligibility and contribution and distribution rules.
- Employee education is helpful.
- Employers should plan proactively when implementing HSA for the first time.
- Work with vendor, so process and communications are coordinated.
- Verify employees are not covered by impermissible coverage through the employer.
- Consider funding employer contributions throughout the year, rather than in a lump sum.
- Perform Section 125 non-discrimination testing early in the year, if possible.
- Please reach out to your NFP contact, if you would like a copy of our HSA white paper with further info.