 COBRA Flexible Spending Transportation Fringe Benefit COBRA When does COBRA begin? COBRA begins the day following the loss of active coverage. The COBRA regulations are intended to insure benefit continuation without a loss of coverage. Is my insurance activated the day I make my election and payment? No, the insurance will not be reinstated until payment is made. However, after the payment is made you must allow 7-10 business days from the date we receive payment for the insurance carrier to reinstate your coverage. When is my premium due? Upon your election of COBRA, you will receive billing coupons indicating what premiums are due, and on what schedule. Your initial payments are due within 45 days of your election and must pay you through your 45th day. Your initial payment includes all back premiums that must be paid to bring the account to the current month. There is no grace period for this payment. All future payments are due on the 1st of the month with a 30 day grace period. All payments must be postmarked by the last day of the grace period to be considered timely. Do I need to send my premium payment in with my election agreement? You have 45 days from your election to send in all back premiums. However, benefits will not be reinstated until payment is received. If my coverage becomes terminated for non-enrollment or past due premiums, am I able to be reinstated? If we do not receive a signed election agreement within 60 days of the notification, you are no longer eligible to elect or continue the COBRA coverage. If no payment is received by the end of the 30 day grace period, coverage will be terminated with the carrier in accordance with the regulations set forth by the Department of Labor. Benefit Advantage cannot reinstate your benefits once they have been terminated for non-payment. How long do we have to notify the COBRA administrator of a status change, such as the birth of a baby, marriage, divorce, legal separation, death of a covered member, etc. You have 30 days to notify us in writing on a status change form. Please call for additional information if your status change involves divorce or legal separation. Why is my claim denied? Benefit Advantage is not an insurance carrier, but rather a third party COBRA administrator who collects COBRA premiums. Benefit Advantage is not responsible for paying insurance claims. If you have questions regarding your insurance plan, please contact your insurance carrier. The number is located on the back of your insurance card. What does my insurance plan cover? Only your insurance carrier has that information, which is the same carrier you had while you were employed. Please direct all questions about the plan directly to them. The number is located on the back of your insurance card. How do I cancel by coverage? There needs to be a written request to cancel coverage on a status change form. This request must be received prior to benefit cancellation. Please print a status change form and submit it to the COBRA team. With what methods may I pay my insurance premiums? You may pay by check, money order, or electronic funds transfer. To start having your premiums electronically withdrawn from your checking or savings account, please click on the following link and complete and return the EFT authorization form. What happens when my COBRA period is exhausted? If there is a conversion policy available on your insurance plan, you will be notified prior to your COBRA end date. You must contact your insurance carrier for more information on this option. If there is not a conversion available, you will need to seek an independent policy through an insurance agent. Benefit Advantage Inc. is not an insurance company and will not be able to offer insurance to you. Flexible Spending Account What are the advantages to the Flexible Benefit Plan and how will it affect me? This plan allows you to have certain expenses deducted from your paycheck before taxes, thus reducing the amount of taxes you pay, giving you more spendable income for the year. You have three choices. They are: - Pre-tax treatment of insurance premiums (Employer Sponsored Group Plans only)
- Health Care Reimbursement Account (i.e. medical, dental, and vision expenses)
- Dependant Care Reimbursement Account (daycare, babysitter*) *Babysitter must report income.
Do I have to participate in all choices? No. Those who do not have children, a spouse or parents requiring dependent care will not be interested in the Dependent Care Account. Most will probably want to participate in the pre-tax premium coverage and the Health Care Reimbursement Account Employees can enroll in any combination of the choices or in none at all. The decision is yours. Is this an automatic election or do I need to sign a form? Every employee must complete a form to enroll or to decline participation. Return your completed form to the Human Resource Department on or before the last day of enrollment. Your Human Resources Department will notify you of the deadline. Can I change my medical account or get into the plan after the beginning of the plan year? You may change your election during the plan year only if you have a change in family status such as marriage, divorce, death, birth, adoption, a change in you or your spouse's employment status, or substantial change in health insurance due to you or your spouse's employment. Otherwise, you will have to wait until the next enrollment period. The change you make must be consistent with the qualifying event. If you have any of the above changes, you must contact your Human Resources Department within 30 days of the change. There are additional qualifying events for the Dependent Care account. Who determines what is an eligible expense that I can deduct on a pre-tax basis? The IRS formulates the guidelines for the Reimbursement Accounts and determines what is eligible. Here is a list of eligible expenses. How do I get reimbursed for Health Care expenses? To obtain reimbursement it is best to use an Explanation of Benefit (EOB) print out from your insurance carrier and a Reimbursement Request Form. For your convenience additional Reimbursement Forms are available on our website or from your Human Resource Department. If the expense is for a service that is not eligible for insurance (i.e. eyeglasses) send a copy of the itemized statement for the services that were provided. Please not that we cannot accept cash register receipts, credit card bills, receipts or cancelled checks as proof of service. If you know your monthly health care expenses will remain at the same dollar amount for the calendar year, (i.e. orthodontics) you are encouraged to use a Recurring Health Care Reimbursement Request From. This allows you to submit one request for reimbursement to Benefit Advantage and we will reimburse you accordingly. You must notify us if the provider or amount of your claim changes. This claim form is also available on this website and from your Human Resource Department. The Recurring Claim Form does not carry over into the next plan year. At re-enrollment time, you must fill out a new form and submit it to Benefit Advantage. I've been deducting medical and dental expenses on my income taxes. Can this continue if I enroll in the Flexible Benefit Plan? You may not claim on your tax return expense reimbursements from your flexible spending plan. Currently you can deduct on your income tax return only the portion of your expenses that exceeds 7.5% of your household income. The Flexible Benefit Plan gives you immediate first dollar savings from Federal, State (except PA and NJ) and FICA taxes. If I allocate $100 into my Health Care Expense Account, and I incur only $80 of charges for the calendar year, what happens to the $20? The IRS states that if you do not have expenses that equal or exceed the money you have set aside on a pre-tax basis, you lose the remaining balance in your Flexible Spending Account at the end of the year. This is why we ask you to be cautious with your election. Your employer cannot return forfeited amounts directly to those individuals who lost it. What forms do I need to send to Benefit Advantage for reimbursement for dependent care expenses? You need to complete the day care section of the Reimbursement Request Form or send the Reimbursement Request Form with receipts showing the amount of payment, date of service provided, Tax I. D. or Social Security number of your dependent care provider. If your dependent care provider does not issue receipts, a signature line is provided in the reimbursement form for their signature and Tax I. D. or Social Security number. If you know your monthly dependent care expenses will remain the same dollar amount for the calendar year, you are encouraged to use the Recurring Dependent Care Reimbursement Request Form. This form allows you to submit the reimbursement form only once to Benefit Advantage, and we will reimburse you accordingly. You must notify us if the provider or amount of your claim changes. Additional dependent claim forms are available on the website and at your Human Resource Department. The Recurring Claim Form does not carry over into the next plan year. At re-enrollment time, you must fill out a new Recurring from and submit it to Benefit Advantage. My mother-in-law baby-sits for my two children. She doesn't claim this income on her income taxes. Can I participate in the dependent care account? No. You may participate in the Dependent Care Reimbursement Account only if the dependent care provider claims the amount you pay them on their income taxes. I over calculated my dependent care expenses. Can I get the remaining balance in my account at the end of the year? No. Money left in your dependent care account must be forfeited according to IRS regulations (see question 8). I am currently using the Child Care Credit on my income tax return. Can I use the Flexible Benefit Plan also? Which give the greater savings? The Child Care Credit on your income tax return currently allows expenses up to $2,400 for one child and $4,800 for two or more children. This is a credit of taxes owed when your tax return is filed. The Dependent Care Account allows immediate elimination of Federal, State, (except PA and NJ) and FICA taxes on expenses up to $5,000 regardless of the number of children. Generally the Dependent Care Account provides greater savings unless your total household income is between $20,000-$24,000 and you have two or more children. It is possible to use both; however, expenses in the Department Care Account reduce expenses allowed by the Child Care Credit dollar for dollar. Please contact the individual who prepares your income tax return for assistance in determining which program provides the greatest savings for you. How does participation in the Flexible Benefit Plan affect information on my W-2 form? Your taxable income on the W-2 form will be reduced by contributions to any portion of the Flexible Benefit Plan. Funds contributed to the Dependent Care Account will be shown in a separate location on the W-2 as a non-taxable item. If I terminate employment, what happens to the money I have allocated to the plan? You will have a grace period (determined by your employer) following termination to submit claims for reimbursement of expenses that were incurred prior to your termination date. Any unused amount after the grace period will be forfeited unless you elect to continue your participation in the Health Care Reimbursement Account under your COBRA rights. If you elect to continue under COBRA you will need to make the deposits on an after tax basis. Once I file an eligible expense, how long do I have to wait until I am reimbursed by Benefit Advantage? Benefit Advantage sends out reimbursement checks to the employee's home weekly. There is a $25.00 minimum check amount unless it is the remaining balance in your account. Will I receive a report showing me the balances in my account? Yes, with every reimbursement you will receive a check stub showing you the details of your account. During the last quarter of the Plan Year a report will be mailed to employees who still have money in their accounts. This reminds you that you must use the money you have set aside or forfeit it at the end of the year. You may also access this information 24/7 on this website or by telephone at your convenience (account information). Who do I contact with questions or concerns on the Flexible Benefit Plan? Call Benefit Advantage at (920) 339-0351 or (800) 686-6829 and select the option for a Flexible Spending Team member. Transportation Fringe Benefit What's the plan's purpose? The purpose of the Plan is to establish a pre-tax voluntary election for work related parking and mass transportation expenses as per the IRS Code, Section 132. What are the qualified expenses? Parking provided to an employee on or near the business premises of the employer or on or near a location from which the employee commutes to work by transit, van, or carpool. Transit passes, tokens, fare cards, vouchers, or similar items entitling the participant to sue mass transit are also considered a qualified expense. This would also include vanpooling. What are the deduction amounts? The amounts allowable are increased annually by indexing the original amounts stated under IRS Code Section 132. The current parking rates for 2003 allow $190 per month or $2280 annually. The current Transit rates for 2003 allow$100 per month or $1200 annually. What is the difference between the Parking Conversion and Parking Reimbursement Accounts? Both accounts allow you to pay for your parking with "pre-tax dollars." The Conversion account is for parking expenses associated with a company owned or sponsored lot whereas the Reimbursement account is for the private lots. What expenses does the Mass Transit Reimbursement Account cover? Mass Transit Account lets you pay your out-of-pocket ferry, monthly bus pass, vanpooling and other mass transit costs with pre-tax dollars. How do I get reimbursed for my expenses? To receive reimbursement for your expenses you are required to complete a Transportation Claim Form (available on this site and at your HR department). Along with this form, attach the receipts (copies are accepted) indicating the dates of service, cost and type of service and mail to PO Box 5546, De Pere, WI 54115 or fax (920)339-0038 to Benefit Advantage. What is a valid receipt for my monthly parking expenses that are not incurred on a company owned or sponsored lot?
A descriptive contract bill, or receipt is preferred. All that is required is a completed Transportation Claim form indicating the date, type and cost of the expense. What happens to the unused money left in my account a the end of the Plan Year? The money will be returned to your employer and either rolled over into the new Plan Year or forfeited. What types of transportation costs are allowable under a Section 132 Plan? Only those parking and mass transit costs that are associated with travel work. Can I use the Parking Reimbursement account to pay for parking expenses resulting from travel to or from business meetings or to visit clients? No, parking expenses (as well as mass transit costs) must be for your travel to and from work. Any parking or transit fees that you pay as a result of a visit to a client, a business meeting, or a downtown visit will not be honored. Copyright©2003 Benefit Advantage, Inc. All rights reserved. Revised: 09/11/03 |
