This depends on your goals and objectives.  Some things you will want to consider are:

• Will the employer pay into this plan to ease the burden of a HDHP?
• Are funds portable or restricted to coverage while the participant is employed?
• Do we want the unused funds to be available in future years, possibly saved for retirement medical expenses?
• Is the goal to simply give the participant tax-free dollars or to restrict the use of these funds to help those that actually have medical expense in the current year?
• Do we want the use of employer contributions to this account to be restricted to specific expenses (i.e., deductibles only, deductibles and Rx only, etc.)?
• We want to move to a higher deductible health plan but not a qualified HDHP.  What are the advantages and disadvantages of the HRA and FSA options?  Do I need to offer both?  How can they be set up to compliment each other and still comply with regulations?

Tri-Star can assist you with some of these issues.  Please contact us for further assistance!

The IRS announced the standard mileage rate for use of an automobile to obtain medical care (which may be deductible under Code Section 213 if it is primarily for, and essential to, medical care)  as 24 cents per mile for 2009.  Fixed costs (such as depreciation, leasing payments, insurance, license, and registration expenses) aren’t included in the medical care and moving expenses standard mileage rate.  Parking fees and tolls related to the use of an automobile for medical purposes, however, may be deductible as separate items.

By plan design, mileage to obtain medical care may be a qualifying expense under a Health Care Flexible Spending Account (FSA), a Health Reimbursement Arrangement (HRA) or a Health Savings Account (HSA).  Please refer to your plan document or plan summary for whether this is an allowed expense under your specific plan.

Mileage to obtain medical care was reimbursable at 19 cents per mile from January 1 through June 20, 2008 and 27 cents per mile from July 1, 2008 through December 31, 2008.  This mileage rate is generally updated each year by the IRS, according to changes in cost.