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Health FSA Cards May No Longer Work At Some Retailers Health FSA Cards May No Longer Work At Some Retailers
[July 27, 2009]
UC employees who use the Health Flexible Spending Account card to pay for prescriptions and other healthcare products may find their cards no longer work at some retailers.
Supermarkets, discount stores, wholesale clubs and mail-order merchants were required by the Internal Revenue Service to install an automated payment system by July 1 in order to continue accepting FSA cards, such as the CONEXIS benefit card. Participants in the University's Health FSA plan who try to purchase healthcare items at retailers that have not installed the new systems will have their card transactions denied. Employees must pay out of pocket for eligible items, and then seek reimbursement through paper forms.
Many retailers, including heavyweights like Wal-MART, CVS, and Rite-Aid, have already installed the required Inventory Information Approval System. Employees should be sure to keep receipts documenting their eligible healthcare purchases, even though these new systems are in place.
Doctors, dentists, hospitals, optometrists, and other healthcare providers were not required to install the new payment system. If registered as a health care merchant, their card readers will still be allowed to process transactions, but CONEXIS cardholders will be required later to substantiate their purchases by providing receipts (if requested).
Kaiser Permanente pharmacies are in the midst of upgrading their pharmacy payment systems, so cards may not work in all instances until that process is complete. NextRX (Anthem Blue Cross), Caremark (Health Net), Medco (WHA), and Tel-Drug (CIGNA) have upgraded their payment systems in compliance with the IRS requirements.
As always, employees are free to pay 'out of pocket' for an eligible item from any merchant and then request reimbursement via paper form — use of the CONEXIS benefit card is entirely optional.