It is an option offered to State employees under the State's FlexElect Program and governed by the Internal Revenue Code (IRC) Section 125. A medical reimbursement account is for paying out-of-pocket health-related expenses for you and your dependents, and is funded by monthly pre tax payroll deductions from your paycheck. The money you contribute to a medical reimbursement account is not taxable, which means you'll pay fewer taxes than you would if this money is counted as taxable income.

• at least $10 per month, and
• no more than $5,000 per year.

A person is considered your dependent if:

• you provide over half of his or her support; and
• he or she is your child, grandchild, stepchild, brother, sister, stepbrother, stepsister, parent, grandparent, stepparent, niece, nephew, aunt, uncle, son-in-law, daughter-in-law, mother-in-law, father-in-law, brother-in-law, or sister-in-law.

A person who is unrelated to you but lives with you and is a member of your household may be considered your dependent if you provide over half of his or her support and the person qualifies as a dependent under Internal Revenue Code Section 152.

You're eligible to enroll in a MRA if you have a permanent position that is half-time or more. If you have a temporary position, you're eligible if you have a mandatory right of return to a permanent position that is half-time or more.

If you're a Permanent-Intermittent employee, you're not eligible to enroll in the MRA.

The first opportunity to enroll in a MRA is within 60 days of becoming "newly eligible". However, for many employees the typical time to enroll is during the annual fall open enrollment period. The open enrollment period is normally held each year during the month of September through mid-October.

You're newly eligible if:

• you're a new State employee hired after the open enrollment period;
• you were on an approved leave of absence during the entire open enrollment period;
• you experience a change in status described in the FlexElect Program Handbook that permits you to enroll as newly eligible; or
• your time base/employee designation changes from one that was ineligible to one that is eligible, or you change from a Permanent-Intermittent position to a permanent position with a time base of half-time or more.

You need to complete the Reimbursement Account Enrollment Authorization (STD. 701R). The STD. 701R is available in the FlexElect Program Handbook, from your Personnel Office, and also on this website.

If you're newly eligible and want to enroll in a MRA, you must submit the enrollment form to your Personnel Office within 60 days of becoming newly eligible. Correctly completed forms received at the State Controller's Office by the 10th of the month are effective the 1st of the following month. If you enroll during the annual open enrollment period, then your effective date is the first of the following year, on January 1st.

If you enroll in the MRA, a $2.50 fee is deducted from your after-tax salary each month.

An expense is incurred on the date the service is provided, not when billed or paid.

1. Fill out the DPA 352 FlexElect Reimbursement Claim Form. (You'll receive a supply of claim forms in the mail before the plan year starts, with a complete set of instructions.)
2. Attach doctor's statement, itemized bill, evidence of benefits statement, etc. A cancelled check is not acceptable documentation.
3. Mail your completed Claim Form and required documentation to Fringe Benefits Management Company (FBMC), the record-keeper for FlexElect.

You may submit claims as often as you like. There are three payment cycles for processing valid reimbursement claims:

• If FBMC receives your claim by the 1st of the month, your reimbursement check will be issued between the 14th and 16th of that month.
• If FBMC receives your claim by the 10th of the month, your reimbursement check will be issued between the 24th and 26th of that month.
• If FBMC receives your claim by the 20th of the month, your reimbursement check will be issued between the 3rd and 5th of the next month.

Once you enroll in the MRA, you can't cancel or change your enrollment during the plan year unless you experience a change in status, called a "permitting event" (e.g., birth of child, divorce, loss of employment, change in provider). There is a complete list of the "permitting events" in the FlexElect Program Handbook.

The IRS allows payment for medical care expenses incurred up to two and one-half months after the end of the plan year. In other words, you may use money deducted in 2007 to pay for medical care expenses incurred up to March 15, 2008. You still have until June 30, 2008 to claim expenses incurred up to March 15, 2008 and any unused amount at the time will be forfeited pursuant to IRS Rules.

If you need more information, check with your Personnel Office to obtain a copy of the FlexElect Program Handbook.

If you are enrolled into a FlexElect account for the 2007 Plan Year and you have questions about your account, call 1-800-342-8017 to speak with a customer service representative from Fringe Benefits Management Company (FBMC), the new record keeper. You also can e-mail FBMC at webcustomerservice@fbmc-benefits.com, visit their web site at www.fbmc-benefits.com, or access its 24-hour automated phone system at 1-800-845-3262.

Current as of February 1, 2008