According to a new survey, many Americans do not understand how flexible spending accounts can save money on routine out-of-pocket health care costs.
Of the survey respondents, 86 percent had at minimum of one misunderstanding about FSAs. One in five respondents incorrectly believe FSA contributions are subject to income and social security taxes, and more than half say they understand FSAs the least, compared to other benefit options, such as health and dental insurance and 401(k) plans.
Nearly 80 percent of household decision makers found it difficult to identify expenses that qualified for FSA reimbursement, including insurance co-payments, over-the-counter products, dental and vision care.
"At a time when Americans are looking for ways to cut their health care costs, it's important that employees take advantage of all the benefits available to them," says Joe Jackson, CEO of benefits provider WageWorks Inc. "Flexible spending accounts are designed to help Americans save up to 40 percent on the health care they need and already pay for out of their own pockets. That's why we're launching a public education campaign to help consumers understand their benefits and learn how they can take advantage of these significant cost savings."
WageWorks is introducing a national public education effort, Save Smart, Spend Healthy, to alert consumers about the money-saving potential of tax-advantaged benefits. The campaign's website, www.SaveSmartSpendHealthy.com, teaches consumers about FSAs using videos, a savings calculator and a list of eligible expenses. The campaign also helps consumers plan for open enrollment under the new health care provisions and understand the FSA changes.
"Beyond promoting the opportunity to save, we've launched this campaign to help consumers prepare for changes brought on by health care reform, including responding to the increasing shift of health costs from employers to employees," Jackson adds.
A recent study by Hewitt Associates shows the average employee can expect health care costs to triple in 2011 from rates in 2001.
"Since we all have health care expenses, taking advantage of an FSA is a great way to plan ahead and save money during these tough financial times," says Manisha Thakor, personal finance expert and spokeswoman for Save Smart, Spend Healthy. "With open enrollment season just beginning in many workplaces, now is the perfect time to learn about how you can make the most of an FSA to help you keep more money in your pocket."
Of the survey respondents using FSAs, nearly 90 percent say they plan to enroll again in 2011.
Complete your profile to continue reading and get FREE access to BenefitsPRO, part of your ALM digital membership.
Your access to unlimited BenefitsPRO content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Breaking benefits news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical converage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
