IRS Benefit Limits for 2012

IRS Benefit Limits for 2012

On October 20, 2011 the IRS posted changes related to various benefits for employees affecting everything from pension plans, 401k's, medical saving accounts, health savings accounts, and commuter benefit plans.
HR Concepts would like to assure our partners and clients that we will be updating our employee education documents, forms, and procedures to comply with these new changes in the coming weeks. In particular we are preparing updated educational materials for enrollment meetings in order to clarify the limits to pre tax benefits administered by HR Concepts. For those sponsoring or considering a Commuter Benefit Plan please note transit reimbursement account expenses will be dropping from $230/month to $125/month and parking reimbursement limits will be increasing from $230/month to $240. There are also minor increases in the High Deductible Plan Maximums for HSA plans. Please review the following highlights as you consider the employee benefit offerings in 2012. To see the most recent IRS announcement regarding benefit limit changes go here.


Medical Flexible Spending Accounts and Over The Counter (OTC) Expenses

What you need to know about Healthcare Reform and your FSA account

  1.  As of January 1, 2011, there are changes occurring in reference to OTC purchases and the use of your Medical Flexible Spending Account.  These changes are part of the Patient Protection and Affordable Care Act signed into law on March 23, 2010.
  2. Many OTC medicines and products will no longer be eligible for reimbursement without a doctor's prescription or Medical Necessity Form.
  3. If you are currently enrolled and using the HRC Total Access Card for your OTC medical expenses, you will no longer be able to use the card for certain expenses once the law takes effect on January 1.
  4. OTC items that are no longer eligible to be put on the card will need to be submitted manually.
  5. In order to be reimbursed manually for certain OTC medicines and products you will need a signed prescription from your doctor or have a Medical Necessity Form filled out.  The additional documentation required for submission will need to be sent to HR Concepts before the claim can be processed and paid in their system.   

The following OTC items are examples of items that require a doctor's prescription or Medical Necessity Form: 

  •     Acid Controllers                                   
  •     Digestive Aids
  •     Allergy & Sinus
  •     Feminine Anti-Fungal/Anti-Itch
  •     Antibiotic Products
  •     Hemorrhoid Preps
  •     Anti-Diarrheal
  •     Laxatives
  •     Anti-Gas
  •     Motion Sickness
  •     Anti-Itch & Insect Bite Pain Relief
  •     Anti-Parasitic Treatments
  •     Respiratory Treatments
  •     Baby Rash Ointments/Creams
  •     Sleep Aids & Sedatives
  •     Cold Sore Remedies
  •     Stomach Remedies
  •     Cough, Cold & Flu Meds

The following list of OTC items is an example of items that are still eligible for purchase and will not require additional documentation: 

  •     Band Aids, Elastic Bandages & Wraps
  •     Birth Control
  •     First Aid Supplies
  •     Braces & Supports
  •      Insulin & Diabetic Supplies
  •     Catheters
  •     Ostomy Products
  •     Contact Lenses and contact lens solution
  •     Reading Glasses
  •     Denture Adhesives
  •     Wheelchairs, Walkers, Canes
  •     Diagnostic Tests & Monitors  

HRC will continue to update materials and our web site to keep all of our participants informed of any additional changes based upon the Health Care Reform legislation.

 


Health Care Reform Update: Medical Flexible Spending Accounts and OTC Expenses

Health Care Reform

HR Concepts strives to keep our clients and partners informed with the most up to date information as it relates to Health Care Reform. HRC has provided various updates to parts of the reform as it relates to Section 125, Flexible Spending Accounts (FSA), and Health Reimbursement Arrangements (HRA). This HRC Insider was written to address the various questions that HRC has been receiving regarding changes to OTC eligible expenses. This notice is going to both participants with a valid email address and employer contacts so everyone is aware of this change.


As of January 1, 2011, there are a number of changes occurring in reference to OTC purchases and the use of your Medical Flexible Spending Account. Many OTC medicines and products will no longer be eligible for reimbursement without a doctor's prescription or Medical Necessity Form. If you are currently enrolled and using the HRC Total Access Card for your OTC medical expenses, you will no longer be able to use the card for certain expenses once the law takes affect on January 1. OTC claims that are no longer eligible to be put on the card will need to be submitted manually. In order to be reimbursed manually for certain OTC medicines and products you will need a signed prescription from your doctor or have a Medical Necessity Form filled out.  As an out of pocket OTC expense these pieces of additional documentation will be required before the claim can be paid in our system.  

The following list of medicines and products will assist you in the process of determining eligible expenses. A Medical Necessity Form may be completed by your doctor to satisfy IRS requirements of providing a prescription to substantiate a medical need.  HRC will provide a Medical Necessity Form on our website or by request through our Customer Care Departments or for employers by request from our Client Relations team.

The following OTC items are an example of items that require a doctor's prescription or Medical Necessity Form:

  •     Acid Controllers
  •     Digestive Aids
  •     Allergy & Sinus
  •     Feminine Anti-Fungal/Anti-Itch
  •     Antibiotic Products
  •     Hemorrhoid Preps
  •     Antidiarrheal
  •     Laxatives
  •     Anti-Gas
  •     Motion Sickness
  •     Anti-Itch & Insect Bite
  •     Pain Relief
  •     Anti-Parasitic Treatments
  •     Respiratory Treatments
  •     Baby Rash Ointments/Creams
  •     Sleep Aids & Sedatives
  •     Cold Sore Remedies
  •     Stomach Remedies
  •     Cough, Cold & Flu

The following list of OTC items is an example of items that will not require additional documentation:

  •     Band Aids
  •     Elastic Bandages & Wraps
  •     Birth Control
  •     First Aid Supplies
  •     Braces & Supports
  •     Insulin & Diabetic Supplies
  •     Catheters
  •     Ostomy Products
  •     Contact Lens Supplies
  •     Reading Glasses
  •     Denture Adhesives
  •     Wheelchairs, Walkers, Canes
  •     Diagnostic Tests & Monitors  

HRC will continue to update all enrollment and educational materials along with our web site to keep all of our brokers, partners, clients, and participants informed of any additional changes based upon the Health Care Reform legislation.


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