Good afternoon,

We have several critical updates for you this afternoon in regards to regulatory changes due to the Coronavirus. We are here to provide you with as much information as possible as updates and changes present themselves.

CARES ACT
As you may know, the House and Senate passed the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) last Friday, which was promptly signed by President Trump. The CARES Act includes three areas that immediately and retroactively as of January 1, 2020, expand the usage of Health Savings Accounts (HSA), Flexible Spending Accounts (FSA), and Health Reimbursement Arrangements (HRA).

The CARES Act allows over the counter drugs to be offered on a pre-tax basis for employees that have an HSA or FSA. Also, it is approved under an HRA if the employer so chooses. Some examples of allowed OTC items are:
  • Cough medicines
  • Cold medicines
  • Allergy medicines
  • Pain relievers, such as acetaminophen

Menstrual products are also now eligible and would include products such as, but not limited to:
  • tampons
  • pads
  • liners
  • cups
  • sponges

The changes are permanent and will remain after the Coronavirus has been contained. Please note: no updates are available yet as to when these items may be purchased with the debit card. Therefore, debit cards may or may not work with these newly covered expenses. In the meantime, employees may pay out of pocket and submit for reimbursement. We will provide more updates as they are available. 

DEPENDENT CARE
Unlike Health FSAs, the provisions of the IRS regulations about Dependent Care Assistance (DCA) are competitively more permissible, enabling participants to make changes in their payroll contribution amounts as the daycare services utilized may change during the plan year. Unless the employer has deliberately specified otherwise and limitations are written in the plan documents, DCA participants are not limited to only the occurrence of traditional status changes to make midyear adjustments any time to their annual election amounts for DCA. Please note, it is the responsibility of the DCAP participant to inform the employer, or plan sponsor, about any permissible change occurrences and to request modification of their annual election, resulting in a payroll contribution change.

RUN-OUT PERIOD & PLAN END DATES
Employers may amend their plans to allow a longer run-out period, add a grace period up to 2 ½ months (available for FSA and DCA plans), or add an FSA rollover (not available for DCA plans) if the plan does not already have one.
We Want to Answer Your Questions!
Medcom is hosting twice-weekly Q&A sessions on all things related to COVID19. Please send us your questions to:


and we will answer them live during our call.
As always, we appreciate your patronage and your continued support during this time. We want you to know Medcom is here to support you now, more than ever.

Michael J. Bracken
President
Medcom Benefit Solutions