Q&A: Administrators: Administrative

Administration of an FSA plan involves maintaining and tracking records of non-participants as well as participants. The following specific functions are included:

• Education of all benefit eligible employees at plan inception, using onsite group meeting(s), color handout material, and question-and-answer session.
• Discrimination Testing, wherein the testing formula requires data on ALL benefit eligible employees, not just participants. ProBenefits normally performs testing on a quarterly basis, since ordinary changes in employee census can materially change the testing outcomes.
  • Benefit Concentration Test - this testing formula measures the participation by Key Employees(1) as a percentage of overall participation in the entire plan (NOT just the FSA portion). Many non-FSA participants nevertheless participate in pre-tax premiums, and are thus included in the testing calculations.
  • Average Benefits Test - this test applies only to the Dependent Care FSA, but ironically incorporates non-participants into the testing formula, as it seeks to measure the average benefit of Highly Compensated Employees(2) compared to the average benefit of all others.
• Re-Enrollment Communication, wherein ProBenefits distributes color brochures for distribution to all employees, refreshing them on plan benefits and requiring their response to enroll or waive by a given deadline.
• Technical Support is provided to the Benefit Administrator for flex-related events and questions affecting all employees - participants and non-participants alike. Again, remembering that "non-participants" may still be participants in pre-tax coverages under the plan, examples often include:
  • Qualifying Events - wherein an employee becomes eligible to join a plan mid-year
  • Termination/COBRA Events - wherein questions arise about pre-tax eligibility of premiums under various termination scenarios
  • FMLA/Leave Events - wherein questions arise about continuation of coverages on a pre-tax basis during a FMLA Leave or regular leave.
  • Adding / Dropping / Changing Coverages - consulting with the Benefits Administrator or professional advisor about qualifying coverages and eligibility of various individuals and situations under these coverages.

In summary the small "Non-Participant" fee is charged to support the proactive administration of your flex plan by ProBenefits. We could bundle this cost into other fee components, but prefer to fully disclose it even though this sometimes places us at a disadvantage when compared to other administrators who use a more passive or even do-it-yourself approach.