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  December 4, 2013
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Flexible Spending Accounts
Become Even More Flexible

By dba Staff

Image courtesy of Eyebobs.

Starting this year, the U.S. Department of the Treasury and the Internal Revenue Services modified the "use-or-lose" rule related to health flexible spending arrangements (FSAs). Now, plan participants are permitted to carry over $500 of their unused health FSA balances into the following year. An estimated 14 million families participate in health FSAs.

For nearly 30 years, employees eligible for health FSAs have been subject to the use-or-lose rule, meaning that any account balances remaining unused at the end of the year are forfeited. (The Vision Council prepared a document on Flexible & Health Spending Accounts that outlines the basics of the different tax deferred flex spending benefit plans that are currently being offered.)

The following optical retailers told dba what impact the new rule might have on their practices, how they encourage patients to use their flexible spending accounts and other end-of-year promotions: David Brown, ABOC, NCLE, optical director, Houston Eye Associates; Aaron R. Schubach, vice president/chief operations officer, Standard Optical / Opticare of Utah; Mark Johnson, director of optical services, Virginia Eye Institute; John D. Marvin, president, Texas State Optical; Diana J. Hall, president, Bard Optical; and Jamie Erhardt, account supervisor, Emerging Vision, Inc.

 

 

David Brown, ABOC, NCLE, optical director, Houston Eye Associates, Houston.

How do you encourage your patients to use their flexible spending accounts before the end of the year? All 19 locations have a 24- x 60-inch banner hanging up in the office promoting the use of FSAs in our opticals. We also present their flex spending account as the first form of payment when they purchase from us in the months of November and December.

How have your promotions regarding flexible spending accounts changed now that patients can carry over $500 from them into the following year? We really haven't felt the need to adjust our approach with FSA promotions even with the new changes to the program. Most patients still believe that that they need to use it or lose it by the end of the year, plus many patients still need to purchase optical materials by the end of the year to take advantage of their insurance plans.

Please describe any other end-of-year promotions you offer. Our contact lens department runs a buy-seven-boxes-get-one-free promotion in the month of December. When you pair this with manufacturer mail-in rebates, along with insurance and FSA, it's a great value to the patient. Our opticals run a second pair discount on Rx eyewear in the month of December. This encourages patients to buy multiple pairs in our opticals, and it's a much easier decision for them when we let them know they can use their FSA dollars. Our lens manufacturer offers a pair 50 percent special year round, so we can offer this promotion without increasing our cost of goods. It's a win-win situation for all parties!

 

 

Aaron R. Schubach, vice president/chief operations officer, Standard Optical / Opticare of Utah, Salt Lake City, Utah.

How do you encourage your patients to use their flexible spending accounts before the end of the year? We currently run an aggressive December TV campaign that has a frame and lens offer, two for $69.95 as well as an aggressive LASIK promotion that is $1,250 off bilateral CustomLASIK (40 percent off) when you have your consultation before the end of the year. Carry over your $500 of flexible spending and make your 2014 New Year's resolution to get rid of glasses and contacts forever! We also use this same offer on Amazon Local Deals for a week starting on Black Friday. Amazon is a great marketing partner for Standard Optical and was recently acknowledged by GeekWire as the number one most visited website during the holiday season of 2012. Over 450,000 targeted Amazon customers will receive our offer via email, web marketing and also pop-ups and banner ads on Kindle Fire HD users.

How have your promotions regarding flexible spending accounts changed now that patients can carry over $500 from them into the following year? We allow all holiday, fourth quarter and special promotions to be redeemed into January if they are taking advantage of one of these flexible spending offers and have/pay for their examination before Dec. 31.

Please describe any other end-of-year promotions you offer. We will be pushing our two for $69.95 and LASIK offers especially hard on electronic/digital media. We use sources like Hyper-X to access thousands of the most visited retail websites during the holidays with banner advertising. In addition to our FSA offers, we mention that insurance benefits are running out and confusion about the Affordable Care Act may create concern about whether or not you can keep your old plan next year, so use it now, etc.

 

Mark Johnson, director of optical services, Virginia Eye Institute, Richmond, Va.

How do you encourage your patients to use their flexible spending accounts before the end of the year? At Virginia Eye Institute we have found the best way to reach patients about utilizing us as a resource to spend their medical spending accounts is through social media. Since it is sometimes a last minute thought to use up the medical spending account, reminders via Facebook and Twitter are very useful. We like to give them multiple options of how they can utilize their spending accounts at our practice, by doing it this way it allows us to create multiple posts in the month of December.

How have your promotions regarding flexible spending accounts changed now that patients can carry over $500 from them into the following year? Now with the allowed rollover of up to $500 to the following year it gives us opportunity to continue reminding patients in January to utilize their spending accounts.

Please describe any other end-of-year promotions you offer. With more and more medical insurances going to high deductibles it is much easier for patients to utilize their medical spending accounts, which makes more competition for our industry to capture these dollars. With that being said, we have already started planning our marketing campaign for this next year, and we plan to start as early as the end of August or beginning of September along with Back to School.

 

 

John D. Marvin, president, Texas State Optical, Houston

How do you encourage your patients to use their flexible spending accounts before the end of the year? It is our policy that patients should use their flexible spending benefits when they are needed to provide vision care. We do not encourage the unnecessary spending of any health benefit, vision or medical. We help all patients who we have not seen in over 18 months to identify whether or not they could benefit from a thorough eye examination. This is done through personal communication. Specifically for those who have used flexible spending accounts in the past, we use the following process:

  • In early to mid-October we cross reference patients with flexible spending plans with the date of their last visit. If their last visit is 18 months or more, we contact them by phone beginning in November. We remind them of the importance of an annual or regular, thorough eye examination. We also state that if they have a flexible spending health benefit any unused portion can be used to cover the expense of this exam. We then encourage them to schedule an appointment with us while we are on the phone with them.
  • We follow this phone call with a personal email message either confirming their appointment, or if we had previously left a voice message, restate our reminder of why it is in their best interest to schedule an appointment. This follow-up email is sent within 48 hours of our original phone call. (Emails are automated and work with our in-office, point of sale computer programs. The phone call is in person. Each staff member is assigned a list which they call each day through November.) We do not make the initial contact via email but rather by telephone.
  • If an appointment is not made within two weeks of our original phone call, we then send a final email reminder with the same message as the first but prefaced with: "We know that it is a busy time of year and we are sending a caring reminder to protect your vision by making time for a thorough eye exam." We enable them to simply reply to the email to schedule their appointment.

How have your promotions regarding flexible spending accounts changed now that patients can carry over $500 from them into the following year? Because we use the process described above, the fact they do or do not have flexible spending balances does not impact our concern or care for the patient. Just because they used a flexible spending account in the past does not mean they have the same coverage today. If they do not have the same coverage, they still need the reminder of the importance of a thorough eye exam.

Please describe any other end-of-year promotions you offer. We use in-office counter cards and social media campaigns to remind patients, their family and friends who use flexible spending accounts that these benefits may expire by year end and they can be used for their end-of-year care.

 

Diana J. Hall, president, Bard Optical, Peoria, Ill.

How do you encourage your patients to use their flexible spending accounts before the end of the year? During the month of December our marketing focuses on "use it or lose it" provisions of flexible spending accounts. We remind our patients that they earned the money in those accounts and that they are running out of time to use their account to take advantage of our December promotions whether for them or as holiday gifts for family members.

How have your promotions regarding flexible spending accounts changed now that patients can carry over $500 from them into the following year? Although the rules may have changed, the uncertainty in the insurance market has left consumers wary. We believe this will cause consumers to continue to exhaust their accounts as they have in the past since no one knows how the landscape may change over the next 12 months.

Please describe any other end-of-year promotions you offer. Many of our patients have insurance benefits that expire at year's end. Just like those with flexible spending accounts, we remind insured patients to use the benefits they earned through their employment before they expire. If they don't, it is like giving money away. Also, since schools begin their holiday breaks in late December, we want parents to schedule eye exams for their students, especially if they have concerns that their students experienced vision issues during the first portion of the school year. Not all kids are seen at back-to-school time, so December offers a great opportunity to get those kids in for eye health exams and related product sales.

 

Jamie Erhardt, account supervisor, Emerging Vision, Inc., Melville, N.Y.

How do you encourage your patients to use their flexible spending accounts before the end of the year? We encourage patients to use their flex dollars with reminders in-store, on the web and in all print advertising toward the end of fourth quarter. It's very important to get the message out in the market while most consumers are preoccupied with holiday shopping.

Please describe any other end-of-year promotions you offer. Our year-end promotions are meant to increase store traffic and encourage the flex spending shopper to come in for an exam. Additionally, there are deep discounts on complete pair packages and products that make great gifts for the holidays. As retailers, we want to take advantage of the busy shopping season and get our sales in front of consumers across the country.



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