Employee Fails to Establish HSA

Question: An employee enrolled in the HDHP but terminated from employment without ever establishing an HSA through the employer’s custodian.  What happens to the HSA contributions for that employee? Compliance Team Response: Where an employee terminates employment prior to establishing an HSA through the employer’s custodian, the employer should refund all of the employee’s HSA payroll […]

Waiting Period Exceptions

Question:  An employer with a 90-day waiting period in its health plan wants to make an exception for an important new hire to provide immediate eligibility.  If the insurance carrier approves the exception, are there any other considerations? Compliance Team Response: As you noted, carrier approval is a crucial consideration.  Insurance carriers will pay claims […]

Monthly Commuter Benefit Election Changes

Question: What are the differences in the election change rules between commuter benefits and FSA? Compliance Team Response: Section 132 Commuter Benefit Elections: May be Changed Monthly The big difference between commuter benefits and FSAs is that the period of coverage for commuter benefits can be (and almost always is) limited to only one month. The […]

Tax Consequences of Domestic Partner Health Coverage

Question:   Could you provide a short employee-facing summary of the tax consequences for domestic partner health coverage? Compliance Team Response: For employers, we have much more detail available in our ABD Office Hours webinar Health Benefits for Domestic Partners: Review of the Tax and Coverage Rules for Employers. Below is a short summary for employees. […]

HIPAA Privacy and Private Workspaces

Question:   An employer  is moving to “hotel” seating for all employees. Do they need to designate a separate private workspace for employees who have access to PHI? Compliance Team Response: Employers that have a self-insured health plan need to maintain a HIPAA firewall  that ensures  only those employees who need access to PHI for plan […]

Limited Purpose Health FSA Preventive Expenses

complQuestion: Can a limited purpose health FSA reimburse preventive medical expenses (in addition to dental and vision expenses) without affecting HSA eligibility?    Compliance Team Response: Limited-Purpose Health FSA Enrollment in a limited purpose health FSA does not block HSA eligibility.  It may reimburse only dental/vision/preventive expenses of the employee or a qualifying dependent. Preventive expenses […]

COBRA Disability Extension

Question:  When is the COBRA disability extension available, and how does it interact with Cal-COBRA? Compliance Team Response: COBRA Maximum Coverage Period Where available, the COBRA disability extension increases the maximum coverage period from 18 to 29 months: 18 Months: Termination of employment Reduction of hours 29 Months: Disability extension 36 Months: Death of employee […]

HSA Limit for Partial-Year Family Coverage

Question:   An employee who began the year in employee-only HDHP coverage was recently married and enrolled her new spouse mid-year.  What is the HSA contribution limit for HSA-eligible individuals enrolled part of the year in employee-only HDHP coverage, and part of the year in family HDHP coverage?    Compliance Team Response: The HSA contribution limits […]

Missing the Dependent Care FSA Run-Out period

Question:  Can the employer make an exception for an employee who fails to submit dependent care FSA claims by the end of the plan’s run-out period?  Could they extend the plan’s run-out period?    Compliance Team Response: Unfortunately, where an employee fails to submit dependent care FSA expenses prior to the end of the plan’s […]