Standard Health Care Flexible Spending Account (FSA)

Each Purdue employee may contribute up to $2,650 for the calendar year to a health care FSA. The annual amount you choose to contribute is available to you on a debit card up front on January 1st and is taken in equal installments from your regularly-scheduled pays on a pre-tax basis. If you are paid on an academic year (AY) schedule, your FSA deductions will be taken only from your September through April pays. You will not have an FSA deduction taken from any summer earnings you may have.

Eligible expenses

You may use the standard health care FSA for health care expenses that are not covered by any medical insurance plan. This includes your out-of-pocket expenses related to your medical plan's deductible, coinsurance, or copayment arrangements.

You may request reimbursement for your own eligible expenses as well as your spouse's. In addition, qualified medical expenses incurred by the following persons are eligible:

  • All dependents you claim on your tax return.
  • Any person you could have claimed as a dependent on your return except that:
    • The person filed a joint return,
    • The person had gross income of $4,050 or more, or
    • You, or your spouse if filing jointly, could be claimed as a dependent on someone else's return.
  • Your child under age 27 at the end of your tax year.

You do not need to be covered by a Purdue medical plan to participate in a standard health care FSA. Those participating in a Health Savings Account may not enroll in a health care FSA, but may enroll in a limited purpose FSA.

Due to Health Care Reform legislation, most over the counter (OTC) medicines require a doctor's prescription for reimbursement. The following are not eligible for reimbursement from your FSA:

  • Amounts paid for health insurance premiums
  • Amounts paid for long-term care coverage or expenses
  • Amounts paid by an insurance plan

See a high-level summary of eligible expenses on a standard health care FSA.

You may only submit FSA claims that you incur while you are participating in the FSA plan. For example, if you retire or separate from Purdue and end your FSA participation on June 30, claims for services through that date are eligible, but claims for service beginning July 1 are ineligible. Note: you have 90 days from your termination or loss of benefits eligibility to file your reimbursement claim for dates of service prior to your separation.

The FSA may be continued under COBRA, if the balance remaining in the account at the time of separation exceeds deductions taken from pay.

Verifying medical necessity

Expenses must be medically necessary to qualify for reimbursement. Because some health care services and products, for example, massage therapy and weight loss programs, may be for both medical and non-medical reasons, HSA Bank may request that your doctor confirm that the expense is a recommended treatment and is a direct result of a specific, diagnosed medical condition.

If HSA Bank requests confirmation, your doctor may complete a letter of medical necessity which you can submit to them.

IRS limitations on flexible spending accounts

  • Expenses reimbursed from an FSA cannot be claimed as a medical expense on your tax return.
  • Only expenses actually incurred during the eligibility period (opening of the account to 12/31 of that calendar year, termination date, or loss of benefits-eligibility) are eligible for reimbursement. Expenses incurred before or after the eligibility period are not eligible, regardless of when you paid for the expenses. FSAs may not pay or reimburse for future or projected expenses.
  • If you do not use all the pre-tax dollars in your flexible spending account, you forfeit the amount left over. That's an Internal Revenue Service requirement.

Claims process

HSA Bank processes all FSA claims for Purdue University for accounts opened on or after 1/1/19. Your claims will be processed through one of the following methods.

  • Debit Card: Standard health care FSA participants receive a debit card that they may use at the place of service to pay for eligible expenses. The card number may also be used when paying for eligible expenses that are billed to you. Most charges for medical services and prescriptions will be substantiated automatically. Retain your receipts in case HSA Bank asks you to provide substantiation for the charge or in case you are audited by the IRS.

    If a debit card transaction is not auto-substantiated, you will receive a letter requesting additional documentation as proof of eligible expense.  You will have 45 days from the receipt of the letter to provide the substantiation via HSA Bank's website, mobile app, mail, or fax.  If you do not provide this documentation, the amount of your unsubstantiated charge(s) will be reported back to you as taxable income, in keeping with instructions from the IRS.

    Debit cards may only be used for the current year’s FSA until December 31 (or 90 days from your termination or loss of benefits eligibility date).  You may continue to file claims for reimbursement until 90 days after December 31 (March 30 in 2020).

  • Reimbursement when debit card is not used: For claims that are not handled with the debt card, you may file your claim for reimbursement until 90 days from December 31 (March 30 in 2020) or 90 days from your termination or loss of benefits eligibility date.
    • HSA Bank (for accounts opened 1/1/19 or after)
      You have three ways to file your 2019 Healthcare FSA Claims
      • Online
        • Website: Log in to HSA Bank and click "File A Claim" in the "I Want To..." section on the left side of the page.
        • Mobile App: Log into your account with the HSA Bank Mobile app and tap "File a Claim".
      • Fax: 855-764-5689
      • Mail: HSA Bank, P.O. Box 2744, Fargo, ND 58108-2744

    • PayFlex (2018 Accounts)
      Three ways to file your 2018 Healthcare FSA Claims:
      • Online: Log into PayFlex and go to File a Claim under your Healthcare FSA snapshot in the Financial Center - My Accounts box
      • Fax: 866-932-2567
      • Mail: PayFlex Systems USA, Inc., P.O. Box 981158, El Paso, TX, 79998-1158

Resources

hsabank

HSA Bank Customer Service
1-800-357-6246
askus@hsabank.com

HSA Bank website

HSA Bank website guide

HSA vs FSA

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