10 must-haves for the best FSA vendors
Learn about the top 10 must-haves for an FSA vendor and ensure the successful administration of your healthcare, vision, dental, and caregiving expenses.
10 considerations when choosing a FSA vendor
The name says it all - a Flexible Spending Account (FSA) is a spending account that can be used to pay for a range of eligible healthcare, vision, dental, and caregiving expenses. As a result, FSA vendors ought to be flexible, too. An exceptional vendor will help you and your employees make the most of these accounts. It’s critical that the vendor not only partner with you, but have the setup and compliance knowledge to help administer an FSA program successfully. In this blog, we’ll share the top 10 must-haves for an FSA administrator.
- Auto-substantiation setup: Simplify reimbursing eligible FSA expenses. Your vendor should follow the IRS rules for claims substantiation. Ensuring your members pay with an IIAS-enabled* prepaid debit card that auto-substantiates certain expenses is a great way to deliver on this mandate – no receipts required. Relatedly, ensure that your vendor keeps copay information on file to auto-substantiate even more claims. Digital auto-substantiation updates outdated processes and provides a modern experience.
- Simple receipt upload process: Members should be given the freedom to choose their preferred reimbursement method, including manual receipt uploads. For members to submit their receipts on time, a vendor needs an easy process and clear communication. The best vendors have sleek mobile apps that enable members to snap a photo and upload receipts from their phones. Remember that unsubstantiated claims may have an impact on your tax savings.
- Easily identify eligible expenses: It can be hard for members to know what items are FSA eligible. Make it straightforward for your members by giving them links to the FSA stores on Amazon, Walgreens, and CVS. They’ll be able to seamlessly shop at the retailers they already frequent.
- World-class support: Your members will need exceptional support to address their questions about claims or other topics. Remember to seek out a vendor that can deliver a great support experience via chat, email, and phone, no matter whether you have two hundred or two hundred thousand members.
- Support all types of FSAs: FSAs are meant for more than just healthcare expenses. A Limited Purpose FSA (LPFSA) is used for eligible dental and vision expenses when combined with an HSA, and a Dependent Care LFA (DCFSA) is used for eligible caregiving expenses. Ensure that your vendor can offer all flavors of FSAs since each type helps your members with specific needs.
- Accommodate large DCFSA expenses: Many vendors require members to submit multiple claims after contributions are funded into an FSA. This can be cumbersome since dependent-related payments are often significant (think: daycare). Ask your vendor if members can submit large expense claims just once, and then as the funds are loaded, get automatically reimbursed.
- Compatibility with HSAs: If a member has HCFSA funds and then enrolls in an HSA, their HCFSA will have to roll over into a LPFSA to remain compliant. Make sure that your vendor can accommodate pairing a LPFSA with an HSA in a seamless way. Otherwise, these seemingly edge-case scenarios can take up a disproportionate amount of your time to support.
- Effective employee education and outreach: Eliminate confusion by educating employees on the intricacies of FSAs. For example, since FSAs have a ‘use it or lose it’ component, it's important members use funds by the end of the calendar year. Your vendor should send out proactive communications to members. Consider how your vendor can help you with templated communications that will reach your members effectively, such as via mobile-optimized email.
- One platform for all spending accounts: Having all of your company’s spending accounts in one place makes administration and support more effortless for you. With one platform for all pre-tax benefits (HSAs, FSAs, Commuter, etc.) and post-tax LSAs, you can have more program flexibility and provide your global workforce with a more equitable approach. Finally, an intuitive, holistic platform reduces confusion for your members and reduces the need for training, saving you time.
- Straightforward non-discrimination testing (NDT): Gone are the days of calling a 1-800 number and waiting for someone to reply with the information needed for NDT. Your vendor should be equipt to make NDT painless, as well as provide recommendations on mid-year steps to minimize risks of failure at year-end.
Forma’s product and expertise will transform your FSA program, bringing a modern experience to your employees. For more information about Forma's FSA offering, <span class="text-style-link text-color-blue" fs-mirrorclick-element="trigger" role="button">schedule a consultation</span> with one of our experts.
*IIAS can only be used for HCFSA, LPFSA, and HRAs