FSA Claims Administration 

Purpose

Flexible spending accounts (FSAs) enable employees to set aside pre-tax income to cover anticipated medical or dependent care expenses. Contributions to FSAs are automatically deducted from the employee's paycheck in accordance with a deduction agreement. When an employee incurs an expense, he/she registers a claim and submits the accompanying receipt, which, if approved, is reimbursed in the employee's next paycheck.

The following processes describes how you manage FSA claims in Benefits, depending on whether or not your organization implements the Employee Self-Service Spending Account Claims (ESS).

Prerequisites

Employees are enrolled in flexible spending accounts

Process Flow

Without ESS

  1. The employee submits a claim to the Benefits office with a receipt.
  2. You enter the claim with the appropriate status.

You can initially enter a claim as pending further investigation and subsequently approve or reject it by changing the claim status.

If you want to reject a claim, you must seek the employee's agreement before making the rejection final. When you have received the employee's agreement, you change the claim status correspondingly. If the employee has already been reimbursed for the expense, the reimbursed amount is automatically deducted from the employee’s paycheck in the next payroll.

With ESS

  1. Employees enter their claims in ESS and submit the related receipts to the Benefits office.
  2. You periodically use the Claims Monitor to show new claims made by employees and approve or reject them.

If you want to reject a claim, you must seek the employee's agreement before making the rejection final:

Result

Approved claims are automatically reimbursed in the next payroll.

Note that it is possible to do the following at any time during the administration process: