IIAS Transition Deadline Is Here
The IRS’ IIAS Requirement Should Boost Auto-Approval Rates
As the IRS imposed July 1st deadline for Inventory Information Approval Systems (IIAS) quickly approaches for drug stores and pharmacies, many merchants are putting the final touches on their systems’ implementations. IIAS allow FSA eligible merchandise to be substantiated at the point of sale. In December, the IRS had delayed this deadline from January 1, 2009 to July 1, 2009.
For most cardholders, the IIAS transition will affect them in a positive way as they may see a jump in the number of transactions that are automatically approved. Many drug stores and pharmacies (online pharmacies included) already have IIAS systems in place and therefore will not be affected by the transition. Some examples include CVS, Rite Aid and Walgreens. For a list of SIGIS (Special Interest Group for IIAS Standards) certified IIAS vendors, click here. High auto-approval rates translate into reduced paperwork and increased convenience and satisfaction for your participants.
For some cardholders, this transition means that their card will no longer work if they shop at smaller pharmacies that choose not to implement an IIAS system. In these situations, debit card transactions will be denied and cardholders will be required to use another form of payment. In these situations, participants may submit for reimbursement through Crosby.
There is, however, one IRS approved exception: the 90% Rule. The 90% Rule states that if a drug stores or pharmacy, on a store location by store location basis, has gross receipts of 90% or more during the prior taxable year consisting of items which qualify as medical expenses, they will not be required to implement an IIAS. Stores that fall under the category may self-certify as adhering to this rule and in these cases, Crosby's system can be setup to allow debit card transactions from these merchants. For a list of merchants who have self-certified under the 90% Rule with SIGIS, click here.
 The demand for Crosby's Flex Debit Card continues to grow. Take advantage of the benefits that the Flex Debit Card has to offer in conjunction with your Flexible Spending Accounts by contacting Darla Rosenfeld via email or by calling 617-630-0468. |
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 National Health Care Reform
Possible Changes For FSA, HRA And HSA Plans
Health Care Reform will continue to be a (if not "the") hot topic for the foreseeable future. While there are so many other priorities of the current Administration, President Obama seems intent on making sure that Congress stays focused on Health Care. New developments are occurring daily related to possible proposals to change, overhaul and particularly, to fund our health care delivery model.
Proposals and studies are due out this week which should start to put into focus the types of plans and ideas that will be up for debate. There have been discussions about the curtailment or even elimination of account-based plans, such as Flexible Spending Accounts (FSAs) and/or Health Reimbursement Arrangements (HRAs) in addition to discussions about possible changes to Health Savings Accounts (HSAs). Recent reports suggest that approaches to find the billions needed to fund these changes include cost reductions in Medicare and Medicaid (through reduced reimbursements to hospitals) and taxing employer-provided health benefits above a certain limit. While there will be much discussion over the next weeks and months, it remains unclear whether there will be enough time to move through all the ideas and come to some sort of consensus before the August congressional recess. |
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 Navigating the COBRA Maze
More COBRA/ARRA Answers from the IRS
The IRS has posted additional Q&A's on its ARRA related website. Some of the topics addressed in these new postings include the question of whether a termination is voluntary or involuntary. For instance, in the case of "a teacher hired only for one school year" when the contract is not renewed or continued, the IRS says this is involuntary (see AE-28). There is also discussion of military leaves with regard to voluntary and involuntary (see AE-33). Furthermore, the IRS has confirmed/clarified that in general, the IRS will not challenge decisions made by an employer with regard to voluntary or involuntary determinations. This seems to strengthen the argument that employers may be better to err on the side of "involuntary" where there are reasonable arguments to be made for both classification as voluntary and involuntary.
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The Crosby Connection Newsletter is intended for Crosby Client Contacts. © 2009 Crosby Benefit Systems
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2010 HSA Limits The IRS has released the Health Savings Account (HSA) Annual Maximums for 2010:
Individual: $3,050
Family: $6,150
The HSA maximum annual catch-up contribution will remain at $1,000 for individuals who are age 55 and older. |
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... Crosby Is SAS 70 Certified?
To receive a copy or our SAS 70 certification, please contact Benjamin Crosby via email or by calling 617-630-0444. |
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For more information about any of our services, please contact Darla Rosenfeld via email or call 617-630-0468. |
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