Medical Expense Reimbursement Plan Issue

[chris]

Employer has been operating med. exp. reimb. plan in a manner that e/ee's can accumulate expense dollars? from year to year. E/er now wants to make such amounts non-cumulative. E/er proposes to tell all plan participants that as of Jan. 1 next year, amounts will no longer be cumulative and that prior accumulated amounts will be lost unless reimbursements submitted before that date. Employer has had no written plan in place, but plans to get one in place setting forth the "new" rules as of Jan 1. Issues??? Thanks.

[Guest eafredel]

Chris,

It is not clear from your post whether the plan provides that the employer sets aside money to pay medical expenses or whether the employees elect to defer a portion of their compensation (on a pre-tax basis) to pay medical expenses. Can you clarify?

[chris]

My understanding is that the employer sets aside X cents per hour worked by an employee for medical expense reimbursement. The employee has not signed off on anything stating they want to set aside any said amount.