4 ways to get the most out of a Health Care Spending Account

September 15, 2023

For plan members, sponsors and administrators

Information to help your employees maximize their health and wellness with an HCSA

Having access to a Health Care Spending Account (HCSA) gives your employees the flexibility to cover health-related expenses that go beyond their standard insurance coverage.

Health Care Spending Accounts allow employees to supplement their coverage and fill any gaps they might be experiencing.

These accounts have a fixed dollar amount for the year and allow employees to submit claims to be reimbursed until the balance reaches zero or expires.

It’s worth noting that Health Care Spending Accounts are unique to each organization and membership and not all employers have them as part of their plans.

What is a Health Care Spending Account?

A Health Care Spending Account is an optional health and dental benefit administration feature that can be part of a traditional or flexible benefits plan.

You decide how much money to deposit into an employee’s HCSA for the year and then the claims are processed according to the plan rules until the balance runs out or expires.

As a plan sponsor, an HCSA might give you:

  • Added flexibility while offering employees added benefits.
  • Predictable costs because employees can’t claim more than they are allocated.
  • A way to help manage your benefit costs.

What will a Health Care Spending Account cover?

The Canada Revenue Agency maintains a list of what it considers an eligible medical expense. Medical expenses that meet these requirements are typically covered under an HCSA.

Employees can use their HCSA to top up what their standard benefits cover or to pay for expenses that aren’t covered under their provincial or standard benefits plan. Here are some examples:

  • The outstanding balance after Manulife pays for a health or dental claim. This could include deductibles and coinsurance amounts.
  • Expenses above the plan maximums under health or dental plans.
  • Expenses standardly covered under health or dental benefits for employees who have opted out of these benefits because they have coverage through their spouse.
  • Other insurable health-related expenses that can be claimed as a medical expense tax credit on tax returns such as medical doctor fees to complete forms, medical equipment that has been prescribed by a doctor, or service animals.
  • Medical expenses that aren’t covered under their provincial or standard insurance plan, such as some diagnostic tests or assistive devices.

How can your employees maximize their Health Care Spending Account?

Access to a Health Care Spending Account can play a vital role in ensuring your employees have additional coverage for a wide variety of health-related expenses. So, here are four ways you can ensure your employees are getting the most from their Health Care Spending Account:

  1. Awareness. Are your employees aware they have this benefit? Let them know what a HCSA is and how it works to supplement their standard insurance coverage.
  2. What’s covered? Show your employees the list of eligible medical expenses by the Canada Revenue Agency so they know what they could potentially be reimbursed for.
  3. Submission deadlines. Let employees know how long credit or claim carryover periods are and when submissions need to be submitted by.
  4. Checking the balance. Ensure employees know how much money they’re allotted and how they can go about checking their balance. When a claim is paid, the Explanation of Benefits will reflect the remaining balance. The remaining balance can also be found under Coverages & Balances on the Plan Member site.

You can find many answers to some frequently asked questions over on our Group Benefits page for Health Care Spending Accounts.

Health Care Spending Accounts | Manulife

Your Health Care Spending Account with Manulife

To find out more about Health Care Spending Accounts and if it’s a benefit included in your plan, reach out to your usual Manulife representative. It is best to check with a Manulife representative to see what medical expenses are eligible for reimbursement.

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