Health Care Flexible Spending Account

Use this account for eligible expenses not covered by your medical, dental, or vision plan, and for certain over-the-counter expenses. Remember, you must reenroll if you want to participate in the Health Care Flexible Spending Account in 2009, even if you’re already enrolled in 2008. You do not need to be enrolled in a health plan through Wells Fargo to enroll in the Health Care Flexible Spending Account.

Note: You are not eligible to participate in the Health Care Flexible Spending Account if you are planning to enroll in the HSA High Deductible Health Plan (HSA-HDHP) in 2009. In addition, you must use all of your 2008 Health Care Spending Account — and this account must reflect a $0 balance — by December 31, 2008 if you want to enroll in the HSA-HDHP.

How It Works

• Contribute between $120 and $5,000 annually on a pretax basis.
• Use your Health Care Flexible Spending Account to pay for eligible expenses incurred during 2009. The account includes a grace period, which allows you to continue to incur eligible expenses for two and a half months after the end of the plan year — until March 15, 2010. Note that if you have a 2009 Health Savings Account (HSA), using the grace period will delay funding of your 2009 HSA. This grace period will not apply if you are planning to enroll in the HSA-HDHP in 2009.

New for 2009

You’ll now have until April 30, 2010 to submit claims for your 2009 Health Care Flexible Spending Account. This deadline is one month longer than the 2008 plan year. For 2008, the claims submission deadline remains March 31, 2009.

WageWorks Health Care Choice Card

WageWorks is the administrator for the Health Care Flexible Spending Account. And with a WageWorks Health Care Choice card, you can easily pay for eligible expenses and save time when submitting a claim for reimbursement. Or if you prefer, you can file a paper claim for reimbursement from your account for eligible expenses you pay out of pocket. Also note the following:

• You’ll receive a card when you first sign up. Use the card at doctor’s offices, hospitals, or certain retail merchants to pay for eligible expenses. Or you can submit a claim to WageWorks for reimbursement of eligible expenses.
• If you already have a card and it is expiring, you’ll automatically receive a new card if you enroll in the Health Care Flexible Spending Account for 2009. Your dependents will also receive replacement cards as needed.
• If your card is not expiring and you reenroll in the Health Care Flexible Spending Account, keep your card. Your new election will be available on the same card as of January 1, 2009.

Examples of Eligible Expenses

For a complete list of examples, as well as access to online tools that can help you estimate how much to set aside in your account, visit WageWorks. Or call WageWorks customer service at 1-877-924-3967.

Expense Category	Examples
Allergy medications	Zyrtec®, Allegra®, Nasonex®, Claritin®
Antacids	Prilosec®, Maalox®, Zantac®
Baby care supplies	Diaper rash ointment, Pedialyte®
Coinsurance	Medical, dental, and vision plan coinsurance amounts
Cold, flu, and fever medications	Robitussin®, TheraFlu®, NyQuil®
Copayments	Medical, dental, and vision plan copayments
Deductibles	Medical, dental, and vision plan deductibles
Dental	Orthodontia
Digestion aids	Antacids, anti-diarrhea, laxatives
Eye care needs	Contacts, contact lens solution, prescription eyeglasses, reading glasses (over-the-counter), LASIK
First aid supplies	Bandages, antibiotic ointments, burn creams
Fertility treatments	Prescriptions, in-vitro fertilization
Medical supplies	Thermometers, blood pressure monitors
Pain-relief medications	Aspirin, ibuprofen, acetaminophen
Pain management	Chiropractic care, acupuncture
Pregnancy	Pregnancy tests, ovulation kits, Lamaze classes
Prescription drugs	Retail and mail order copayment or coinsurance amounts
Smoking cessation aids	Nicotine patches, gum, lozenges
Skin care	Acne treatments
Sleep aids	Nasal strips, medications

Health Care Flexible Spending Account Versus Income Tax Deduction

For health care, most people do not have enough out-of-pocket expenses (not covered by insurance) to qualify for a deduction. You would need to have out-of-pocket expenses that exceed 7.5% of your adjusted gross income. For example, if your salary is $40,000 per year, you could only deduct out-of-pocket health care expenses that exceed $3,000 from your income tax.

However, with the Health Care Flexible Spending Account, there is no adjusted gross income requirement — and you do not need to have a specific dollar amount of expenses to take advantage of the pretax savings. Consult with your tax advisor or refer to IRS Publication 502, Medical and Dental Expenses (PDF).

Example of Health Care Flexible Spending Account (FSA) Savings

	Pretax (With Spending Account)	After Tax (No Spending Account)
Annual Pay	$35,000	$35,000
Contribution to Health Care Flexible Spending Account	($1,000)	$0
Taxable Pay	$34,000	$35,000
Taxes (example — your rates will vary)	$11,220	$11,550
Adjusted Pay	$22,780	$23,450
After Tax Medical Expenses (copays, coinsurance, over the counter drugs, etc.)	$0	$1,000
Spendable Income	$22,780	$22,450
Savings from FSA	$330	$0

For details on the Health Care Flexible Spending Account, see chapter 6 of the Benefits Book.