Gearing Up for Annual Enrollment: How Do I Decide if I Should Participate in the Flex Medical Plan?

What is the flex medical plan? 
The flex medical account is a pre-tax deduction that you have taken out of your paycheck, so it’s 100% your money. You can use this money to be reimbursed for your and/or your spouse and/or dependents’ out-of-pocket medical, dental, vision and/or prescription expenses during the benefit plan year (July 1 to June 30). You can be reimbursed from this account even if all the funds aren’t in your account because the deduction is being taken from your paycheck. If you also have an HRA account, you will have to get reimbursed from this account first before your HRA account. 

Expenses must be incurred during the benefit plan year, and you can only roll over up to $500 annually. This year the IRS has increased the annual maximum deduction to $2,700. Although when filing taxes, the amount is deducted pre-tax, which makes your paycheck appear less to the IRS, the amount is included in your income reported to IPERS. Also, new this year (beginning July 1), Heartland AEA will pay the monthly flex medical account fee ($43.20) for employees. 

Who participates in flex medical? 
Employees who have the $750 deductible health plan because they don't have an HRA to use for their out-of-pocket expenses. Employees who want the pre-tax deduction. Employees who have the $1,500 deductible health plan, but who don’t want to use their HRA because they are trying to build it up for retirement use. Employees who are going to have a large medical or dental expense and want to pay the bill immediately but want to spread the total cost across their paychecks. 

How do I determine how much to deduct? 
If you are new to flex medical, you can try an annual deduction of $500 to see how much or if you would actually use it without fear of losing any of that $500 if you don't have any costs during your first benefit plan year (since $500 will roll over into the next year). You can also use the 121 Benefits calculator and/or the “What If” calculator on the Employee Dashboard > Employee Online to see how the deduction would affect your paycheck.