Plan Information & Enrollment
VEBA MEP Brochure
The VEBA MEP brochure is an excellent educational tool if you are a newly-enrolling participant or just need a refresher. The brochure explains the benefits of a health reimbursement arrangement (HRA) and how you can use it.
VEBA MEP Participant Enrollment
When you become eligible to enroll, your employer will enroll you automatically, direct you to enroll online, or provide you with a VEBA MEP Participant Enrollment Kit, which will include an Enrollment form.
PARTICIPANTS: Your participant account will be established after you have been enrolled and have received a contribution from your employer. We will then send you a welcome packet, which will include your participant account number, claims-eligibility date, investment allocation, a Plan Summary, and online registration instructions.
Paper participant account statements are mailed in January and July. If you are signed up for e-communication in lieu of paper (recommended), participant accounts statements are generated quarterly, and we will notify you via email when statements are available for online viewing. To sign up for e-communication, log in and click My Profile, contact our customer care center, or submit an Account Change form. Forms are available after logging in or upon request from our customer care center.
Your legal spouse and qualified dependents, including your young-adult children through the calendar year in which they turn age 26, are eligible for coverage. Generally, dependents must satisfy the IRS definition of Qualifying Child or Qualifying Relative as of the end of the calendar year in which expenses were incurred to be eligible for benefits. These requirements are defined by Internal Revenue Code section 105(b). The IRS definitions supersede and may differ from state definitions.
You may choose to enroll and cover your Washington State registered domestic partner who does not otherwise qualify for coverage as your dependent under the VEBA MEP. The value of non-dependent domestic partner (NDDP) coverage is taxable. Therefore, if you choose to enroll your NDDP, applicable taxes will be deducted from your VEBA MEP account for each month of NDDP coverage. In addition, the VEBA MEP will issue an IRS Form W-2 showing taxable income to you based on the NDDP coverage value.
Starting and stopping NDDP coverage is not automatic. You must submit a Non-dependent Domestic Partner Enrollment/Disenrollment form if you want to enroll or disenroll your NDDP. If elected, coverage will continue until (a) you disenroll your NDDP during the next annual open enrollment period or special open enrollment or (b) your participant account balance runs out. NDDP enrollment and disenrollment policies are described below. Forms are available after logging in or upon request from our customer care center.
Qualified Expenses & Premiums
Common qualified out-of-pocket expenses include deductibles, co-pays, coinsurance, prescription drugs, and certain over-the-counter (OTC) items. Eligible insurance premiums include:
Medical (includes marketplace exchange premiums that are not, or will not be, subsidized by the Premium Tax Credit);
Tax-qualified long-term care (subject to IRS limits; read Tax Qualified Long-term Care Insurance Premium Limits below);
Medicare Part B;
Medicare Part D; and
Medicare supplement plans.
Section 213(d) of the Internal Revenue Code defines qualified expenses and premiums, in part, as “medical care” amounts paid for insurance or “for the diagnosis, cure, mitigation, treatment, or prevention of disease, or for the purpose of affecting any structure or function of the body…” Expenses solely for cosmetic reasons generally are not considered expenses for medical care (e.g. face-lifts, hair transplants, hair removal (electrolysis)). Expenses that are merely beneficial to your general health, such as vacations, are not medical care expenses.
Please note the following:
IRS regulations provide that insurance premiums paid by an employer, deducted pre-tax through a section 125 cafeteria plan, or subsidized by the Premium Tax Credit are not eligible for reimbursement. If requesting reimbursement of premiums deducted from your paycheck after tax, you must include a letter from your employer that confirms no pre-tax option is available.
If you or your legal spouse has a section 125 health flexible spending account (FSA), you must exhaust the FSA benefits before submitting claims to your VEBA MEP.
Claims for over-the-counter (OTC) medicines and drugs (except insulin and contact lens solution) must be prescribed by a medical professional or accompanied by a note from a medical practitioner recommending the item or service to treat a specific medical condition. Thus, OTC medicines and drugs, such as aspirin, antihistamines, and cough syrup, must be prescribed. The prescription requirement applies only to medicines and drugs, not to other types of OTC items such as bandages and crutches.
Tax-qualified Long-term Care Insurance Premium Limits
Premiums paid for tax-qualified long-term care insurance are eligible for reimbursement subject to annual IRS limits. The limits are indexed to inflation and are updated annually.
Coordination of Benefits
Read the information below to learn how your VEBA MEP coordinates with health flexible spending accounts (FSAs) and health savings accounts (HSAs).
If you or your spouse has a section 125 health FSA, you must exhaust the FSA benefits before submitting claims to your VEBA MEP, which is a health reimbursement arrangement (HRA).
You can have an HRA (VEBA MEP) and an HSA, and you can use either your VEBA MEP, if claims-eligible, or HSA to reimburse your qualified expenses (no ordering rules). But, if you have a claims-eligible VEBA MEP account and want to become eligible to make or receive contributions to an HSA, you must first elect “limited-purpose” VEBA MEP coverage. Only certain dental, vision, and orthodontia expenses are covered while coverage is limited. You can switch your VEBA MEP back to full coverage after you stop making or receiving HSA contributions (certain limitations may apply).
Only the types of expenses listed below are covered while your “limited-purpose” coverage election is in force. All other expenses incurred while coverage is limited, including qualified insurance premiums, are not covered.
Standard dental care services (not related to a medical condition or accident), including dentures
Routine eye exams, contact lenses, and eyeglasses (excluding initial lenses and standard frames after cataract surgery)
Keep in mind that limiting your VEBA MEP coverage is not the only HSA contribution eligibility requirement. You should check with your HSA provider, but generally any adult can contribute to an HSA if they (1) have coverage under an HSA-qualified high deductible health plan (HDHP); (2) have no other first-dollar medical coverage (other types of insurance, such as specific injury insurance or accident, disability, dental care, vision care, or long-term care insurance, are permitted); (3) are not enrolled in Medicare; and (4) cannot be claimed as a dependent on someone else's tax return. Your maximum annual HSA contribution amount depends upon your HSA eligibility during the current calendar year. If you become HSA-eligible mid-year, a 12-month testing period may apply to determine your maximum annual HSA contribution.
Premium Tax Credit Eligibility
If you purchase insurance through a marketplace exchange and want to qualify for the Premium Tax Credit, you should (1) read our Facts About Premium Tax Credit Eligibility handout; and (2) consider whether you will need to first use up, limit, or waive your VEBA MEP benefits. To get a copy of the Facts About Premium Tax Credit Eligibility handout, log in and click Resources, or request a copy from our customer care center.
The Plan Summary contains a question & answer section to help you understand and use your VEBA MEP, a summary of general plan information, and the following series of important notices:
Medicare Part D Notice of Non-Creditable Coverage
Coordination of Benefits with Medicare
Exemption form Annual Limit Restrictions
Premium Tax Credit Eligibility
A copy of the Plan Summary is provided to all newly-enrolling participants with their welcome packets. To get a current copy, log in and click Resources, or request a copy from our customer care center.
Summary of Benefits and Coverage
As a participant in the VEBA MEP, the benefits available to you under the Plan, as well as any limitations, are important. To help you understand the types of benefits provided by the Plan and any applicable limitations, the Plan makes available a Summary of Benefits and Coverage (SBC), which summarizes important information about your benefits. Please note that the format and content in the SBC is required by federal regulation and is designed to apply to health insurance plans. Your HRA is not a health insurance plan. Therefore, the SBC indicates that some of the information and defined terms are not applicable to your VEBA MEP. To get a copy of the SBC, log in and click Resources, or request a copy from our customer care center.