3 Things We Need To Know About Our Health Spending Account

It is very important to fully understand the options in our Employee Benefits Package to make sure that we are taking full advantage of our benefits.  These options usually include Medical and Dental benefits, as well as various personal insurance options.  One of the major assets in our Employee Benefits Package is the Health Spending Account.

Here are 3 things that we need to know about our Health Spending Account:

Our Credits Are Based on Our Personal Family Situation

When choosing our Medical and Dental benefits each employee is given a fixed number of dollar credits which is determined by their family situation.  A single employee will receive fewer credits than an employee with a spouse or an employee with a spouse and dependants.  However, every employee with a spouse will receive the same amount of credits, and every employee with a spouse and dependants will receive the same amount of credits etc.

A Health Spending Account is a Free Benefit to Employees

Employers usually offer 3 or 4 different medical and dental options which each offer a different percentage of coverage at a different price.  The cost of our chosen medical and dental coverage is deducted from our total dollar credits.

Once we choose our medical and dental coverage as well as our personal insurance options all unused credits are deposited into our Health Spending Account.  Personal insurance options usually include disability insurance, travel insurance, as well as accidental death and dismemberment insurance.

Health Spending Account Credits Can Pay for Uncovered Expenses

Depending on the amount of coverage that we choose our medical and dental insurance may cover 50% to 90% of our expenses.  Most of the time Dentists and Pharmacists are able to directly submit our claims to the insurance company; therefore we are only responsible for paying the difference.

Medical expenses such as Doctor Visits are not able to be directly submitted to the insurance company.  Therefore we must pay the total medical bill upfront and later submit our total claim to the insurance company for reimbursement.  As an example, if our medical bill is $300 and our coverage is 80% we will need to pay $300 at the Doctors office; we can later submit a claim to be reimbursed $240.

The amount of our claim that is not directly covered by the insurance company can be submitted for reimbursement under our Health Spending Account.   Using the previous example, we can submit the $60 (20%) that we had to pay as an expense under our Health Spending Account.

We can also submit all claims that are not covered as an eligible expense under our Medical or Dental benefits to our Health Spending Account for full reimbursement.  We can submit an unlimited number of expenses per year up to the total dollar value of our Health Spending Account.

(Photo by Cristiano Betta)