BUSH BUDGET PLAN WOULD IMPROVE UNREIMBURSED MEDICAL

The Bush administration is working on a proposal to make Unreimbursed Medical spending accounts more attractive according to a recent article in Business Insurance Weekly.

Although the administration did not provide any details about the changes, the proposal likely would resemble one President Bush made during the election campaign. In October, he proposed allowing participants to carry over from one year to the next up to $500 in unused balances. This would overturn the current IRS regulation known informally as "use it or lose it."

It has always been argued that relaxing the rules on left over funds would increase participation thus, lowering healthcare costs.We will keep you informed once the administration releases more information.

IRS TELECONFERENCE Q & A

During a February 28th teleconference, IRS officials discussed areas of confusion regarding the final status change regulations.

Below is one the questions that provides clarification regarding loss of coverage.

Q- Can an Unreimbursed Medical election be increased during the year upon loss of spouse's dental coverage?

A-Yes, but only if the spouse loses coverage through her employer on account of a change in status event, such as termination of employment. No change is permitted if the spouse loses dental coverage for other reasons (e.g., the spouse just decides to drop it during open enrollment). Please note that rules about significant cost or coverage changes do not apply to Unreimbursed Medical (URM) and such an event would not be allowable reason to change a URM election.

CHECK PICK UP AUTHORIZATION

Participants who submit a request for reimbursement and want to pick up their check at our office must have identification available before we can release the check. If someone other than the person the check is payable to is picking up the check, a letter must be sent to us in advance giving that person authorization. This includes spouse and other family members.

We will be closed April 13 in observance of Good Friday.