IRS Ushers in a New Era For Debit
Cards
The IRS seems to have finally settled
on the relationship between debit cards
and claims substantiation requirements
with large implications for both employers
and their administrators. Essentially,
the IRS, in its 2006-69 bulletin has
blessed the merchant-based Inventory
Information Approval System (IIAS) as
an acceptable and supported method of
point-of-sale debit card swipe approval.
With IIAS the merchant essentially codes
its entire inventory as FSA-eligible
or FSA-ineligible. When a plan participant
presents a debit card for payment, the
IIAS system funnels only the FSA-eligible
expenses to the FSA debit card. If the
customer has also purchased ineligible
items, the merchant will request another
from of payment for those items. This
is known as "split-tender".
Benesyst hails this decision as an important
step forward in increasing convenience
to FSA participants who use their
Benesyst Benny
TM
Benefits Card to purchase a mixed cart of
prescription drugs, over-the-counter
items and ineligible items such as food,
clothing and toys, commonly sold where
drugs are sold. The decision, which
reinforces the need for complete claims
substantiation completely, supports
all of Benesyst's long-standing FSA
policies and automation practices.
The only merchants thus far connected
with IIAS are Walgreens, Wal-Mart and
Sam's Club. We will keep you updated
in this news section and otherwise as
to significant changes.
About Benesyst
Benesyst is an established, high technology,
high performance benefit administration
outsourcer. Benesyst is the creator
of BeneSmart™, a state-of-the-art, online
enrollment and eligibility management
solution that revolutionizes the way
systems "think" about and manage benefits.
Benesyst is also a "best of breed" Flexible
Benefit Account (all types), HIPAA/COBRA/State
Continuation and Short-Term Disability
Benefit Administrator, offering high-touch,
high performance innovative solutions
in these traditionally outsourced services.
www.benesyst.net.