The City of Billings sponsors a 125K Plan (IRS) cafeteria plan, which allows employees to use pre-tax dollars to fund health expenses. These accounts are typically called a Medical Flex Account or Health FSA-Flexible Spending Accounts.
Many people find it a cost effective way to pay for such items as medical and dental plan deductibles/copayments, eyeglasses, contact lenses, orthodontic, and other health-related expenses not covered by insurance. Generally, the expenses covered must be “medically necessary”, please see IRS Publication 502 for information regarding Medical and Dental Expenses. The health flexible spending account offers you great advantages since your total annual election is immediately available for reimbursement on January 1st or whenever your benefits effective date is.
The City also sponsors a Dependent Care Reimbursement flex account which is for child daycare expenses. You must have accumulated a sufficient credit balance in your Dependent Care account in order to receive full reimbursement; otherwise, you will receive partial reimbursement with the remaining portion of the claim automatically considered for reimbursement in subsequent weeks as more dollars are contributed from your paycheck to your account.
Eligibility RequirementsThis is an election that employees have to designate annually and is a voluntary benefit. All permanent 20+ hours per week employees are eligible on the first day of the month following a month of permanent employment. Employees will save on Federal, State, and Medicare taxes paid on their pre-tax payroll deduction contributions.
Maximum Annual ContributionsThe maximum annual contribution allowed is:
- Medical Flex: IRS maximum allowed
- Dependent Care Flex: $5000
Flexible Spending Accounts – Other Facts to ConsiderIn order to allow this unique opportunity to reduce your taxable income, the IRS has placed some restrictions on this benefit:
- Compensation redirection authorized for both medical and dependent care expense reimbursement is in effect for the entire year unless you have a change according to the IRS regulation on qualifying life events.
- You must use all of the funds in your spending accounts by the end of the Plan Year or you will lose them; the balances cannot be combined, carried over into the next year, or converted to cash. Therefore, plan your annual elections carefully.
- You will receive statements periodically from EBMS to remind you how much money is left in your account or you can view your EBMS miBenefits account. This money must be used for expenses incurred before the end of the Plan Year or FORFEITED. You may continue to submit claims for reimbursement up to sixty (60) days after the Plan Year ends for prior year’s expenses.
- If your employment with the City terminates during the calendar year and you are participating in Flexible benefits, then your eligibility for participation ends on your final day of employment and you FORFEIT any monies left. However, you will be given sixty days (60) days from your date of termination in which to submit expenses incurred prior to your termination.
City of Billings – Flex Plan Year
• Medical Flex - January 1st through December 31st.
• Dependent care Flex - January 1st through December 31st.
Auto flex provides that all claims that are submitted for processing to EBMS (medical & dental, not vision) will also be submitted to the Flex Plan for possible reimbursement. Therefore, out-of-pocket expenses (insurance deductibles, copayments) are reimbursed automatically up to the balance in your FSA.
However, some claims; for example, dependent care expenses, vision and over the counter items for flex reimbursement will have to be manually submitted to EBMS for processing. It is also recommended that if you have your FSA monies earmarked for a particular procedure/claim, you will not want to elect this feature.
Flex reimbursement forms are available online at ebms.com or in Human Resources. You are also able to email a scan of the EBMS Flex for Reimbursement form with the supporting documentation. It is the participant’s responsibility to fill out the flex reimbursement request and attach supporting documentation with submission. Employees can also drop off or route their completed paperwork to HR for EBMS since an EBMS courier picks up paperwork every business day morning. Flexible reimbursements are processed every Monday, Wednesday and Friday.
PLEASE NOTE: Because of complications with coordination of benefits and Federal Law, Auto Flex cannot be elected by participants that are covered under another insurance policy, even if within the City.
Click here for Forms and Resources.