What are some of the challenges you, and or your company’s Benefits and Compensation group, are facing with FSA claims reimbursement?
I am seeking to understand from HR managers, executives as well as those who are submitting FSA claims, what their needs are as it relates to the overall claims process. What are some of the challenges you, or your employees encounter when submitting claims, what are the methods and approach used to adjudicate and substantiate claims, how errors are encountered, etc.
If there was a solution to automate and help make FSA claims more convenient, increase control over compliant, would your company be open to using such a product?
Today our company, Finpago (www.fsaok.com) provides a patent-pending service designed to help consumers get the most from their FSA account. When they register, we are able to track purchase information relating to pharmacy and over-the-counter health care expenses made with any payment card(s) they register.
To make using the FSA as convenient for the participant as possible, we can automatically transmit reimbursement claims for those expenses to their TPA for reimbursement whenever they use the registered cards for health purchases. For TPAs we can auto adjudicate purchases and reduce or eliminate manual administrative processing efforts.
Answers (2)
I think one of the biggest challenges facing the FSA claims reimbursement process is the adjudication process for FSA eligible claims. There can sometimes be a ‘gray’ area of what the IRS or employer deems as an eligible expense and what’s actually reimbursed. Additionally, each merchant is different and may have receipts that don’t clearly delineate the item or service rendered, thus resulting in a denied claim (that may truly have been eligible).
However, due to IRS notices 2006-69 and 2007-02, nearly all merchants (online & brick/mortar) must be IIAS (Inventory Information Approval System) compliant by 2009 to accept FSA debit cards. IIAS was instated to help alleviate the pain of submitting receipts and to also increase enrollment in medical (Healthcare) FSA accounts. IIAS makes it possible to adjudicate claims at the POS, thereby eliminating the need to submit receipts after the purchase has been completed (pay and chase).
Given my lack of knowledge surrounding your company’s services, I can’t pass judgment. However, I will say that most TPAs that provide this service to employers typically have a robust tracking system available to the participant via the web, which tracks their expenses by type, provides tax saving analysis and resources for maximizing their FSA benefit. Lastly, given that the IRS has mandated the implementation of the IIAS system, this has taken much of the manual labor out of the process and has created less administrative headaches for the participant and TPA/Employer.
Your company’s venture may be serving a much needed niche within the market and if so, I would highly recommend leveraging the PBMs, drugstores, and IIAS to be the outsourced provider of the feed/auto-adjudication process. If possible, the data that’s collected can be mined (in the aggregate) and analysis provided to employers/TPAs on spending habits.
Long-winded, I know – but I hope this provides some insight.
Marikay J
Experienced HR Generalist and Staffing Professional
Best Answers in: Staffing and Recruiting (12), Compensation and Benefits (5), Personnel Policies (5), Business Development (3), Career Management (3), Job Search (2), Employment and Labor Law (2), Organizational Development (2), Education and Schools (1), Mentoring (1), Resume Writing (1), Budgeting (1), Corporate Taxes (1), Lead Generation (1), Planning (1), Distribution (1), Professional Books and Resources (1)
Hi, Marty!
Companies I have worked for utilize debit cards that have significantly reduced processing problems. These companies also provide ongoing communications via employee portals on the corporate web site.
The debit card process appears to offer the benefits you describe.
