FlexOptions Limited Health Flexible Spending Account (LHFSA)

Convenient, Cost-Effective, Easy to Use.

How Does It Work?

Limited Health Flexible Spending Accounts (LHFSA) is a special HFSA that allows employees to set aside pre-tax dollars for out-of-pocket dental and vision expenses. Participation in the LHFSA also benefits the employers—they can reap significant savings from pre-tax payroll deductions.

The LHFSA is designed to be paired with an HSA, and allows participants to save for eligible dental and vision expenses so they can save more money in their HSA for future medical or retirement expenses. If an employee has an HSA, he or she is not allowed to have other coverage outside the High Deductible Health Plan (HDHP), except for permitted coverage like dental and vision.

HSA Only. All medical, dental and vision care expenses are paid out of one health savings account, quickly depleting health care resources.		LHFSA with HSA. Employees pay for dental, vision and preventive expenses from the LHFSA so that their HSA continues to accrue funds for future medical and retirement expenses. If needed, the HSA can alos be used to pay for extra dental, vision and preventive expenses. This plan combination creates even greater tax savingds for both the employer and employees. The employer saves $77 in FICA and FUTA taxes on every $1000 contributed to the LHFSA!

Covered Expenses Include:

• Eyeglasses, including exam fee
• Contact lenses and supplies
• Dentures
• Lasik eye surgery
• Dental x-rays
• Orthodontia
• Preventive care, such as cancer screenings, women’s annual exams, etc. See “Types of Preventive Care Benefits Allowed” under External Resources for a complete list from the IRS.

LHFSA funds pay for eligible dental, vision and preventive expenses—prescription eyeglasses, orthodontia, contact lenses and more—that are not covered by any other plan for the prevention of a medical condition or illness.

Administration Made Simple.

CoPower provides employers with the claims substantiation and administration required to stay in compliance with federal laws. Employees must submit receipts to CoPower Financial for validation, though some expenses will be automatically approved through the use of our convenient CoPower prepaid card!

CoPower Benny^® Prepaid MasterCard^® Card Available.

Participants can use Benny, the CoPower prepaid MasterCard card, to pay for dental and vision services at an eligible provider’s office, pharmacy or lab! The CoPower prepaid MasterCard card offers easy access to LHFSA balance, no reimbursement waiting periods, and ease of use at eligible provider locations to pay for qualified dental and vision expenses instantly.

For preventive expenses, participants will need to pay out-of-pocket and submit for reimbursement with a copy of their health plan’s Explanation of Benefits.

Use the CoPower Prepaid Card at Selected Merchant Partners—
Reduce the Need for Receipts!

Participating employees can purchase LHFSA-eligible Over-The-Counter (OTC) dental and vision medications at 1-800-Contacts, Walgreens, Walmart, and Sam’s Club, virtually eliminating the need to provide receipts and be reimbursed. Employees simply need to present their CoPower Benny card to pay for their LHFSA-eligible expenses, and another form of payment for ineligible expenses. No receipts are required for the amount paid by the CoPower Benny card!

Online Ordering Has Never Been Easier.

CoPower and Evolution Benefits have partnered with drugstore.com™, Walgreens.com, and VisionDirect.com to offer an online LHFSA pharmacy store that automatically substantiates claims for over-the-counter items!

• Eligible purchases made with the prepaid card will automatically be deducted from your LHFSA account
• Choose dental and vision products from over 2,000 clearly marked FSA-eligible items

Stay in Compliance.

Key rules that govern LHFSAs include:

• Plan document, Summary Plan Description and Non-Discrimination testing

• Use or lose it—Any LHFSA funds that have not been claimed within 90 days after the end of the plan year are forfeited to the employer.

• Uniform coverage—Offers employees access to the full election amount on the first day of the plan year.

• Claims Filing—All reimbursed costs must have been incurred within the plan year, and claims for dental and vision expenses must be filed within 90 days of the end of the plan year. Claims must include documentation, including service date, description and charges.

• Grace Period—Employers now have the option of adopting the Grace Period, which allows employees to use remaining balances in the prior plan year to pay for expenses incurred up to 75 days in the new plan year.