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SMART Employees
Angela is a SMART employee
Angela – Administrative Assistant
Annual Salary - $35,000
Angela, an administrative assistant with the city of Houston, is interested in the new HFSA program and wants to take advantage of the tax savings in this plan. During open enrollment, she reflects on health care expenses she thinks she will have in the next 12 months. She is single and is generally very healthy. Every once in a while, Angela gets a migraine headache, so she visits a primary care provider once a year and has one prescription filled. Angela visits her gynecologist once a year for her well-woman exam. She also belongs to a local gym and works out three times a week to stay in shape. She goes to the dentist twice a year for cleanings and exams. She also gets her eyes examined and wears contact lenses.
After reading the HFSA guide, Angela realizes she will have health care expenses that can be reimbursed through the HFSA. This is what Angela determined she should put in the HFSA:
Type of Health care Expense |
Quantity |
Amount |
Explanation |
Gynecology exam visit |
1 |
$0 |
The medical plan covers well-woman exams at 100 percent with no copayment. |
Prescription drug obtained at a participating pharmacy |
1 |
$30 |
Angela uses a brand-name. |
Primary care provider office visit |
1 |
$20 |
The medical plan pays for the office visit after Angela pays a copayment of $20. |
Gym membership |
1 |
$0 |
Gym membership is not an allowable expense in the HFSA. |
Dental exams and cleanings |
2 |
$0 |
The DHMO covers cleanings and exams up to twice per year at $0 copayment. |
Eye exam |
1 |
$3 |
HMO eye exam copayment. |
Contact lenses |
1 |
$90 |
Angela buys an extra pair of contact lenses that are not covered by an insurance plan. Vision expenses are eligible for the HFSA. |
Over-the-counter drugs:·
- Aspirin
- Contact lens cleaning solution
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$60 |
Over-the-counter drugs are eligible expenses in the HFSA. |
Total amount Angela puts in HFSA: $203 |
$8.46 per paycheck. |
Total savings: $63.00 |
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SMART savings
Angela
Administrative Assistant
Combined tax rate: 25%
HFSA contribution: $203
Annual savings: $63.00
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Herbert - another SMART employee
Herbert - Financial Analyst III
Annual Salary - $45,000
Herbert knows that he will have health care expenses next year and he wants to maximize his savings by taking advantage of the new Healthcare Flexible Spending Account. He is married with two children, 5 and 7. His wife does not work. Herbert understands that he can put money in the HFSA for health care expenses for his family. Here are Herbert’s figures:
Type of Health care Expense |
Quantity |
Amount |
Explanation |
Herbert’s PCP office visit |
1 |
$20 |
The HMO covers PCP office visits after a $20 copayment |
Wife’s well-woman exam |
1 |
$0 |
The HMO covers well-woman exams at 100 percent with no copayment. |
Children’s routine exams |
2 |
$0 |
The HMO covers well-child exams at 100 percent with no copayment. |
Prescription drugs: Herbert’s blood pressure medication is a preferred brand-name drug he gets filled at a pharmacy every month |
12 |
$360 |
Preferred brand-name drugs have a $30 copayment when bought from a participating pharmacy for a 30-day supply. |
Prescription drugs: Herbert Jr. has allergies and takes over-the-counter allergy medication every day. |
12 |
$90 |
Herbert buys these over-the-counter. |
Dental cleanings and exams |
8 |
$0 |
The DHMO covers cleanings and exams up to twice per year with no copayments. |
Total amount Herbert puts in HFSA: $470 |
$19.58 per pay period. |
Total savings: $75.00 |
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SMART savings
Herbert
Financial Analyst III
Combined tax rate: 25%
HFSA contribution: $470
Annual savings: $75.00
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