The Coronavirus Aid, Relief and Economic Security (CARES) Act, signed into law by President Trump, addresses several key issues introduced by the COVID-19 pandemic. The act acknowledges the economic impact the outbreak has had on the country and seeks to provide financial support to businesses, employees, individuals and families. Additionally, it specifically provides guidance on retirement and health care benefits, many of which MidAmerica administers on behalf of public sector employers and employees across the country. To help you better understand how the CARES Act impacts Health Reimbursement Arrangements (HRAs), Flexible Spending Accounts (FSAs) and Dependent Care Accounts (DCAs), we have highlighted the key takeaways below.
Health Reimbursement Arrangements
The CARES Act includes a provision that removes the documentation requirement on certain eligible expenses. If your plan allows reimbursement of all Full 213(d) Medical Expenses, the following items will not require a prescription or doctor’s note to be considered eligible:
- Over-the-counter drugs or medication
- Menstrual care products
These changes are effective for items purchased after December 31, 2019.
Important note on debit card expenses:
Please note that if a participant uses their debit card to purchase one of the items above, the merchant’s Inventory Information Approval System (IIAS)* may not be updated yet to reflect the CARES Act provisions—most merchant systems will take several weeks to update. This means that these items may not be authorized at point-of-sale. If this happens, the participant would pay for the expense out-of-pocket and then submit a claim form to MidAmerica along with an itemized receipt. We would then process the claim and provide reimbursement.
Flexible Spending Accounts
The CARES Act further defines qualifying events as it pertains to the COVID-19 pandemic, ultimately providing greater flexibility for mid-year election changes on both medical and dependent care accounts.
As stay-at-home or shelter-in-place mandates continue to affect organizations across the country, change in employment status, reduction in hours or FMLA leave are becoming more common. As such, the Internal Revenue Service (IRS) recognizes the following as qualifying events that allow for election changes:
- Reduction in hours that causes a loss in coverage
- A change in employment status
- FMLA leave
- A substantial change in employer benefits and cost
Dependent Care Accounts
For DCAs, the CARES Act recognizes that, as child care facilities and schools are temporarily closed, the need to increase or decrease the DCA election could be necessary. Some examples of these qualifying events include:
- Loss of child care services due to day care or child care facilities closing
- The need for child care services due to school closures
- Loss of employment or reduction in work hours that allows participant or eligible spouse/dependent to take of care in child in place of a day care or child care facility
For additional information on how the CARES Act and COVID-19 are impacting FSAs, download our Frequently Asked Questions document by clicking here.
If you are a current participant and need to change your FSA election due to one of the qualifying events above, download MidAmerica’s Change in Status Election Form by clicking here.
As MidAmerica continues to monitor COVID-19’s impact on our health & welfare plans, we are committed to providing updates to our partners, employers and participants. If you have any questions on the CARES Act, your benefits with MidAmerica, or need additional support during this time, we’re here to help. Our hours of operation have not been impacted and we are available via the contact information listed below.
Service Center Hours of Operation
8:30 a.m. – 8:00 p.m. ET Monday through Thursday
8:30 a.m. – 6:00 p.m. ET Friday
Email: [email protected]
Contact Information by Plan Type
Health Reimbursement Arrangements/Flexible Spending Accounts
Claims and Documentation Submission Email: [email protected]
General Inquiry Email: [email protected]
Employers and Alliance Partners
Please reach out to your dedicated account representative, account manager or our Account Management team by emailing [email protected].
Do you also have a retirement benefit, such as a Special Pay Plan, APPLE Plan or 3121 FICA Alternative Plan? To read more on how those benefits are affected by the recent CARES Act, click here.
*What is IIAS?
Many major pharmacies are registered as Inventory Information Approval System (IIAS) certified. The pharmacy’s IIAS system allows them to differentiate between eligible and ineligible expenses, making it possible for eligible HRA and FSA products to be automatically approved at the point of purchase.