Date incurred vs. date paid

[Guest Gary Rouse]

How does everyone handle the case of braces where the date incurred for the medical service is 2003 but payments are made over a two year period - 2003, 2004 and 2005. Would you reimburse expenses incurred in 2003 but paid in 2004?

Thanks.

[Guest JerseyGirl]

If I'm reading your post correctly, there are no services being rendered after 12/31/03? If that is indeed the case, reimbursements would be allowable only during the 2003 plan year and run-out period, if any, but only for those services which were rendered during 2003. Remember, for purposes of a 125 plan, services don't need to be paid for, just rendered during the plan year.

In most cases, the process of having braces spans at least an 18-24 month period. There are more expenses up-front -- complete x-rays, study models,etc -- which front load the costs, and most dentists like to see a good sized deposit at the beginning of treatment, either from the patient or payment of any portion covered by their insurance. When a participant makes monthly payment arrangements for braces, they should get a complete treatment plan from the dentist. This will show what treatment will be rendered every month of the entire process, and the associated fees for that treatment ( which somehow, always exactly matches the monthly payment!!). With that knowledge, the participant can then elect the proper dollar amount to contribute for the year, and the claims adjudicator is being provided with the necessary documentation for allowing reimbursement of each claim for monthly expenses.

[Guest lsh]

Orthodontia is an exception to normal FSA adjudication. I suggest going to www.EBIA.com site which provides informal comments from Harry Beker on the subject. Type Orthodontia in the search box, which should direct you to EBIA WEEKLY Archives dated 8/23/01.