SLuskin

We have a participant who submitted, as part of her dependent daycare claim, the cost of a webcam that the daycare provider offers so that the parent can "see" the child during the work day. Does anyone think this is part of the permitted dependent daycare expenses, or is it a very nice add on that cannot be pretaxed? Thanks.

There is a group in which one of the partners leaves the company along with over half the employees. All these employees have elected cobra from their former company. The prior company wants to change their name as well as their tax id number essentially closing the prior company business. When the new company sets up their new benefits under the new name and tax id number, are they under any obligation to offer the prior cobra participants benefits under their new company?

If the employer is dissolved, and not acquired, then the plan terminates. Employees need to be told the final date that they can submit claims. If there are funds remaining, they can be distributed to all plan participants on an equal and taxable basis. The employer may also choose to use those funds to reimburse itself for the plan administration expenses.

A client has both an HSA and an AFLAC hospital protection plan. Does anyone know if this plan conflicts with the HSA? It pays benefits for inpatient hospitalization, surgery and diagnostic testing.

I think things may have eased up for pop plans, but I think you would have a tough row to hoe in abruptly changing a flex plan mid year. You may have employees who would lose money in the changeover - employee "saving" for a root canal in September makes contributions Jan-July with no other expenses. If you terminate that plan and start a new one, the funds don't transfer over and that employee would lose the money. Next scenario - employee uses entire annual election on day 1 for a valid expense. If the plan year finished out, the employer would be made whole. Now the employer will lose this money.

I agree. Absent a court order, I don't see a status change here. It doesn't seem "fair" to the employee, but this seems to be one of those situations where the employee is stuck until open enrollment.

We use the terms almost synonymously. If there is a carry over, we always use the HRA document. If there is a simple POP plan for premiums, and the employer wants to somehow supplement the group medical plan, we use a MERP supplement to the POP plan.

There is no way this is permissible. I just worked on a similar situation with a client. We made them finish out the plan year. Then this year that started 1/1/2011, we had a short plan year until 7/31/2011. Their health plan renews August 1. The next plan year will be August 1, 2011 until July 31, 2012. Obviously, if they don't get audited, they will have "gotten away with it". But you certainly don't want to encourage that decision in any way.

Is there a court order?

If the policy cost is the same for 1 child or 12 children, we haven't been adding any imputed income for the domestic partner children. However, if there is 1 charge for EE + 1 child and a different charge for EE + 2 or more children, we have been imputing the cost of that first child to the domestic partner.

Yes, it is definitely permitted.

I am not reading the question that way. The POP is passing. It's the FSA which has not passed. Disaggregating the plans would still mean that the FSA has not passed. So, the KEY and HCE would be taxed on their entire contribution. Not the end of the world. In the future, see if they are small enough to qualify for the Simple Cafeteria Plan. Or else, have them make employer contributions only into the accounts of the NHCE.

You are correct!

no

What is the plan year for the FSA?

If the Simple rules are followed, all of the discrimination tests are deemed to be passed except for the Adoption Assistance Plan. I haven't seen the CORBEL document, but the whole purpose of the SIMPLE plan is to be able to automatically pass the tests that would not otherwise pass.

Because both people are retaining coverage, identical, etc. I think that would be up to the carrier.

Is this part of the group health insurance plan or is this a separate self-funded plan?

It depends on the maximum amount that someone could receive under your plan. Right now, the trigger is $1000. So, if the maximum benefit available per covered employee, including any covered family member, is under $1000, you do not need to do the MSP reporting.

Has anyone seen a new revenue ruling or IRS ruling that says breast pumps are ok for medical FSA without reservation? We had always approved them if the health of the mother warranted, i.e. breast abscess. We have a participant who says that the IRS reversed its position and now they are always approved, just because it is better for the baby. Any input would be appreciated. Thanks.

I agree with JRG. You can't do that and be compliant.

I think that would be a status change. It is loss of coverage under the spouse's employer's plan.

I am looking for some guidance here. Plan renewal date is December 1, 2010. The client is renewing a plan with exactly the same provisions as last year except for 1 thing. Instead of Rx copay $15,$25,$40, it is now $100 Rx deductible and then $15,$25,$40. I know the deductible can go up 15% plus medical inflation. But what if the current deductible is zero? They would like to keep their grandfathered status, even though they do not have any discriminatory practices. Everyone has the same entry date, same % of premium paid across the board, no one excluded once probationary period has been met. Thank you.

Best advise is to have the client use an outside TPA.