An additional benefit that can be included with a Section 125 Cafeteria Plan, a Flexible Spending Account (FSA) allows employees to set aside money on a pre-tax basis to pay for eligible health care expenses. The employer saves 7.65% in matching FICA taxes for every dollar contributed by employees! The FICA savings helps to offset any cost to the employer for offering the plan. This allows employers to offer an expanded benefit package, which helps to attract and retain employees, without significantly increasing their healthcare costs.

In 2013, the Affordable Care Act (ACA) made revisions to FSA guidelines that state an Employer must offer a qualified group medical plan in order to offer an FSA for its employees that reimburses medical expenses. In order to offer an FSA, an Employer must also offer a group medical plan that meets ACA standards for excepted benefits.

Health FSA Account

Under a Health FSA Account, employees are reimbursed for eligible health care expenses that are not covered or reimbursed under the employer's health plan. Employees set aside an election amount up to an annual maximum determined by the employer. This election is deducted from the employee's paycheck on a pre-tax basis, resulting in tremendous tax savings to the employee (average tax savings for participants is 25-40%!) The contribution limit for employees is set by the employer, up to a maximum cap indexed annually by the IRS.

Limited FSA Account

Under a Limited FSA Account, employees are reimbursed for eligible dental and vision expenses that are not covered or reimbursed under the employer's health plan. Employees set aside an election amount up to an annual maximum determined by the employer. This election is deducted from the employee's paycheck on a pre-tax basis, resulting in tremendous tax savings to the employee (average tax savings for participants is 25-40%!)

BMS LLC Flexible Spending Account Administration includes preparation of required Plan Documents including Summary Plan Description and Adoption Agreement, Employer Only secured website for easy submission of eligibility changes and access to full FSA reporting, comprehensive employee education, routine plan updates to our Clients based on changes in rules and regulation of Section 125, completion of required Discrimination Testing (if requested by the employer).

BMS FSA Administration features for employees includes FREE FSA Debit Card, free Mobile App for smart phones and an employee website for secure claims entry, tracking of reimbursements, and many other features. BMS FSA administration also includes daily claims review, adjudication, and processing, as well as twice a week reimbursement payments. Our dedicated Customer Services Staff is always available to answer any questions.

Find More FSA Resources

Employee

Employee Claim Form for Flexible Spending Account.pdf Form to complete to file for reimbursement of qualified expenses under your Medical, Limited, and /or Dependent Care Flexible Spending Account

ACH Direct Deposit Form.pdf Form to complete and return to BMS to set up ACH Direct Deposit of reimbursements

Flexible Spending Account Worksheet.pdf Worksheet to help calculate potential participant contribution and savings for the Flexible Spending Account

Flexible Spending Account Qualified Expenses List.pdf Broad list of potentially qualifying expenses for reimbursement from the Flexible Spending Account

Employer

Flexible Spending Account Employee Enrollment.pdf Form to complete for employee to be enrolled in Medical and/ or Dependent Care FSA

Limited Flexible Spending Account Employee Enrollment.pdf Form to complete for employee to be enrolled in Medical, Limited, and/ or Dependent Care FSA

Flexible Spending Account Change in Status.pdf Form to report an employee change in status and corresponding election adjustment for the Flexible Spending Account