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Paper Cuts: Fighting for Control of Your Money in Flexible Spending Accounts

Paper Cuts: Fighting for Control of Your Money in Flexible Spending Accounts

Picture of William Heisel

ASIFlex, the company that manages the ins-and-outs of my flexible spending arrangement for health costs, is staffed with polite people who must deal with a lot of upset people.

When you are paying for doctor visits, hospital stays or other health care services, to be told at every turn that you need to justify those costs with an extra layer of paperwork or lose all the money in your account can be anxiety inducing, as I . President Obama recently suggested getting rid of the so-called “,” and, while there may be good business reasons to keep it, I have seen very little written about its actual impact on consumers.

The Internal Revenue Service recently issued on the possible repeal of the “use it or lose it rule.” I wish I could invite them onto the phone with me for one of my conversations with ASIFlex. They go like this:

Me: Why is it that every time I go to the doctor or a clinic I receive a note saying that my visit requires more paperwork?

ASIFlex: “We always require follow-up documentation for bills that aren’t regular co-pays, like $20, $50 or $100.”

Me: “My plan doesn’t have co-pays. Just a deductible. So are you saying that this isn’t really about making sure that the money is being used for health care costs? It’s just about whether the money is being spent in round numbers?”

ASIFlex: “We don’t make the rules. The IRS does.”

It doesn’t make sense that someone with a plan that includes co-pays would have to follow different requirements than someone with a plan that does not. Often plans with higher deductibles don’t include co-pays at all, and a growing number of companies are turning to high-deductible plans to save money.

Sam Baker at :

Roughly 13.5 million people are covered by high-deductible insurance policies — an 18 percent increase from 2011, according to new research from America’s Health Insurance Plans (AHIP). AHIP tracked policies that have a deductible of at least $1,200 for a single person or $2,400 for a family. Consumers pay lower monthly premiums in exchange for the higher out-of-pocket costs.

And, if my experience is any indication, these folks are bound to run into the same frustration of antiquated bureaucratic hurdles preventing them from efficiently spending their own money on health care.

Here’s more of my conversation with ASIFlex.

Me: “But you make rules, too. Why didn’t you ask for follow-up documentation for this other purchase I made in July?”

ASIFlex: “That must have been from a drug store. We don’t usually need documentation for purchases at drug stores.”

Me: “Doesn’t that seem odd? I can put a six pack and a bag of Cheetos on my card at a drug store. My daughter’s pediatrician sells neither.”

So, you ask, why fight it? Why not just get in the habit of always having your doctor or dentist email a copy of your receipt to the ASIFlex as you’re walking out the door?

That’s a brilliant solution, reader. But ASIFlex does not accept documentation via email.

You read that correctly.

ASIFlex requires you to print out a copy of the notice it sends you and fax it to the company with the receipts.

Sounds old fashioned but simple, right? Except that ASIFlex plays hide-and-seek with the fax number.

Even though you have to log in with a PIN to see anything about your account, to find the fax number, you have to provide your social security number and enter the “Secure Message Center.” The notification about the center says, “This information will be available for viewing for a limited time period.” So move quickly. 

Now, you may remember me saying that the biggest red flag for me when a patient calls with a complaint about health care is . So I will try not to sound conspiratorial here. But I do wonder why a company would fight customers at every turn over money customers put into their own accounts. As I explained Friday, if you don’t spend all that money by the end of the year, it goes to the federal government. In a setup like that, the incentives for the private firm managing the account should be customer-focused, to help customers easily use their funds while monitoring for abuse. There should be no upside for the company to hold on to more of the customers’ funds.

The season when employees have to choose their health insurance plans is upon us. The IRS is considering getting rid of the “use it or lose it” rule. It would be worth the time for a health writer or two to take a hard look at the way flexible spending arrangements actually operate. Look at what the IRS rules really say and then document how the companies that run these accounts work to keep customers from . 

I’ll have some tips for digging into flexible spending arrangements in a future post.

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Photo credit: Andrius Petrucenia via Flickr

Comments

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I just got one of those letters and wonder why a the medical groups transaction on the card isn't enough. I hope the IRS realizes how ridiculous it is and decides to let me pay for my medical bills.

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It would be a lot simpler to go back to the old system in which you could deduct medical expenses from your income when you filed your income tax return. Not only would this eliminate all the nitpicking and paperwork, doing this would also allow us to eliminate the huge non-government (and presumably profit-making) bureaucracy it takes to run the flexible spending account system, which would save health care overhead costs. Presumably the bottom line for government revenues would be about the same; the IRS could audit suspected fraud.

Note that the companies running these accounts have an incentive to make it difficult and time consuming for participants. The more employees they need to run the system, the more money they make.

Picture of Liz Borkowski

It sounds like your employer might want to consider switching to a different company to manage the FSA benefit. My employer switched a couple of years ago, and we now have an online system that lets us upload PDFs for claims. I've found it very easy to use the online system to see which claims have been accepted and which may need more documentation.

Part of the reason I as a user have had a good experience with this company is that I have the financial resources to pay out of pocket for non-copay expenses and then get my claims reimbursed. (I use my FSA debit card for copays, but pay for things like glasses with my personal credit card, then send the receipt in for FSA reimbursement.) This way, I don't have to worry about getting asked for further documentation -- with threats for noncompliance -- later on. But it would be harder for someone with tighter financial constraints, or without access to a scanner and internet connection, to do this.

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I have little doubt that AsiFlex must get something out of hanging onto my money. I cannot imagine why a service provider has designed their systems so that they purposefully do not work for the consumer. Ridiculous! My employer, the State of Massachusetts recently switched to AsiFlex to manage our FSA accounts. What I've learned in the few months since this switch occurred is that it would be cheaper in terms of time and effort for me to not have this FSA account. Every time I use the card I get email after email about need for this or that documentation. The other day I went to the ear doctor as a follow-up for some minor surgery that I had a couple of months ago and discovered that my card had been suspended. I guess the deduction from my paycheck ought to be suspended as well unless I intend to involuntarily "donate" my salary back to the State of Massachusetts. Ugh! So much work to get this benefit. From the doctor's office I tried to call AsiFlex to ask them to turn the card back on. First of all, it is difficult to even find a phone number to call. Secondly, even if the doctor's office send them the information right away, it was going to take 24 hours to turn the card back on. I was out of luck with my own money. I think the safest thing to do will be to cancel the FSA because I don't want to lose money to such a ridiculous system. Thanks but no thanks. I don't need a part time job dealing with AsiFlex at every turn. They must gain a lot from being a barrier to a valuable program for taxpayers. Thanks for nothing, AsiFlex!

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Same complaint as you, they shut my card of because of a $25.83 paid to Quest Diagnostics. I already paid other payments to Quest and they are questioning this, Insane. I will use the rest of my money hopefully with no more paperwork and I will not get this program next year.

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I regret every minute of switching to ASIFlex. My husband's flexible spending account was so much simpler and I cannot wait to go back. Every step with ASIFlex is a chore, numerous phone calls and faxes to accomplish every task and still no success. We have had to submit documentation for EVERYTIME we have used the card. Every co-pay, every deductible paid at the doctor's office, letters from our dependent care provider, etc... And it's so difficult to submit a claim because it has to be faxed and then it goes into their special system where information clearly written on the form you submitted suddenly disappears. Then they send you a message that the line is blank and you look at the form where it is clearly not blank and they say sorry you can resend the form. It has taken me four phone calls and now two faxes just to add my husband to our account. Still no success. Sure they are polite when I call but they are not helpful and they do not provide accurate instructions. I now tell them that I am certain I will be calling back because something will be wrong with the form that I am submitting. The same form that I just had you walk me through filling out so that I can try to submit a correct form the first time. What a waste of time.

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Add me to the list of people who are beating their heads against the wall with ASI. The old FSA management was leaps and bounds better. I recently had my card suspended (something that never once happened in all the years with the old company) so I paid out of pocket for a copay. I got a receipt, got my card reinstated, and submitted the claim for $25. I never heard anything. So I ed them. The reply I received stated that yes, it had been approved, but then there was another transaction at my eye doctor that required additional documentation so they used that $25 to offset that payment. My head is spinning around right now. I can't fathom the reason or legality behind that. Yes, the IRS makes rules but ASI makes even more.

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I was told that this was the best plan for e being I am a single father of 4 teens.I was persuaded to enrole into the program.My children are over the age limit,healthy and I am equally as healthy..Now,after paying into this plan for a year,the "use it or lose it " rule is taking all $2500 dollars with no refund what so ever!Now ,I don't know about the rest of the people enrolled in this scam but the government has enough of our money! That's where it goes,back to the government! No refund,no reimbursement of any kind! That's fraud in my book!I'm not sick,I don't wear glasses,no medications,no out of pocket.They did tell me I can buy aspirin,band aids,sun screen....come on,$2500 in crap I don't need? Make up an illness so as to spend the money in the account? Nope,not me!Just give me a refund!

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Thought it was just me banging my head against the wall. What I assumed were echoes was apparently just everyone else's cranial reverberations. ASI is a pain in the butt.
I filed a claim in February knowing that my company pay ASI a month behind, thinking this would give everyone plenty of time for January's paper work to shake out. Nope instead someone applied January's contribution to 2016 and waited to use February's contribution to close out 2015. Which posted oh about one week before the final claim date, on two weeks after I made my final claim for the year.

This is a terrible benefit to offer your employees, extra aggravation at your own expense.

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ASIFlex is a highly unscrupulous company that obstructs the customer at every turn, though always careful to use legal means. (Actually - I'm not really sure that it is legal to lie to your customers about the IRS requiring this red tape. It is not the IRS, or else competing providers would also behave this way - and they do not. This is 100% on ASIFlex!) How do they benefit from the frustration of their customers? Why do they continually ask for additional documentation for the smallest expense - such as a $2.99 co-pay on a prescription, filed by the clinic pharmacy itself! Why make their fax number almost impossible to find on their web site, but demand that documentation be sent via fax only - no email, no US Mail? That's what we need to find out. How is it to their advantage for their customers to give up and quit filing for their flex spending reimbursements? A class action lawsuit would be the thing.

Any lawyers out there? You would find thousands of ready clients in Massachusetts alone. I will be first in line.

Stan

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Why on Earth does my hard earned cash not come back to ME when I have exhausted my medical necessities? Who gets it? The IRS? What is the legal basis for this?? I earned that money. Why not just tax us on the remainder and give us our damn money back? SCAM, that's why.

First of all, HALF the population menstruates but feminine hygiene products are not covered? Boy, good thing Viagra is though. Water filtration systems - NOT covered. Supplements - NOT covered. Absolute load of crap. I will never take part in this scam again, and I plan on being VERY vocal about it.

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