Employee Reimbursement Accounts (ERA) - Friend or Foe | | Submitted to Local 1942 by Janet Ramsey
The Employee Reimbursement Accounts offered by the hospital through the State of Wisconsin is one great perk on our taxes. There is a loophole in this perk we receive of which everyone should be made aware.
I was on medical leave last year for 3 1/2 months. Of this, one month was paid using my sick leave. From then on it was Income Continuation. When I came back in November, I tried to submit some of my medical expenses. They were denied stating I had been removed from the program. At that point, I had paid around $1,500.00, and that money was sitting in my account. I talked with Benefits and they directed me to the ERA specialist for this area. This person is a representative of the ERA program for the State of Wisconsin. This is the explaination on how the ERA program works.
The Reimbursement accounts are based on the idea everyone will work the full 12 months and contribute the total amount. People will only be reimbursed for the amount they committed to contributing for the year. The program works on a "guarantee" basis, not a pro-rated basis. Meaning people will be reimbursed for the full amount at the time of submission of appropriate documentation up to their yearly contribution limit. If the amount contributed is less than the yearly contribution, the state will keep the money. The State feels it will be a wash in the "end".
Example: An employee has a laser eye treatment, in Feb, at a cost of $5,000.00 and then quits employment the next week, the medical bill is paid and the State is out the money.
Example: An employee contributes $2,000.00 and only spent $1,500.00 during the year. The State will keep the money. Nothing is returned.
If you miss 4 or more pay periods, then you will be removed from the program and all monies not spent prior to the date of removal will be forfeit to the State. I missed 5 pay periods. The only amount they would reimburse was for the amount of the bills I had prior to me taking my leave.
There is an exception to this rule. If the employee is on FMLA (Family Medical Leave Act), then the employee is able to make up the missed payments either before or after returning to work. When the employee's contributions are up to date, then ERA will reimburse the bills. If the employee knows they will be on an unpaid leave, it is best to make the payments, thus avoiding a huge bill in the end. My entire paycheck the week before Christmas went to pay the ERA. In the end I came out better.
I was told this information in my benefit book and I should have read it. But like many Americans who are on overload, I did not read my book. Now I know - read your books no matter how much you know about your insurance.
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