Flexible Spending Account (FSA)

A Cafeteria Plan allows employees to pay for their employer-sponsored insurance premiums. The employer may also implement a Flexible Spending Account into the Cafeteria Plan which allows employees to be reimbursed for expenses like deductibles, coinsurance, co-pays, prescription drugs, vision expenses, dental expenses, day care services and privately owned insurance policies.

Even the most comprehensive insurance policies have out-of-pocket expenses. FSAs can help your employees save on these expenses.

Similar to a Premium Only Plan, a Flexible Spending Account permits pretax payment of insurance premiums and also offers three additional benefits to employees:

Health Flexible Spending Accounts
Employees use payroll withholding of pretax dollars to pay for a out-of-pocket medical expenses.

Dependent Care Flexible Spending Accounts
Employees use payroll withholding of pretax dollars to pay for work-related expenses associated with care of a live-in dependent, such as a child or elderly relative.

Flexible Spending Accounts encompass all the aspects of a POP plan with these additional value-added services:

  • Case setup/Employee Communication
  • Online / Onsite Enrollment
  • Claims Submission to Sorensen Flexible Benefits
  • Claims Adjudication tailored to employer schedule
  • Payments via EFT or check
  • Online Participant Inquiry and reporting
  • Online Employer Module and reporting

By implementing an FSA into your Cafeteria plan, you can reduce your employees taxable compensation. You are also giving employees a way to pay for out-of-pocket medical expenses and work-related daycare expenses.

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