Open Enrollment is coming...

...And whatever you do, resist the urge to overcommit funds to, or participate at all in what your company touts as a "Flexible Spending Account". This is the account to which you can send some amount of your pre-tax income, and then get these funds reimbursed to you after you've spent the money on healthcare or dependent care expenses. This makes the money spent on these expenses not subject to federal and state taxation. That's the good part. The bad part is that you must decide before the start of the year how much money you want to divert into these accounts, before you actually know how much you'll be spending. The other burden this puts on you is that you have to fill out paperwork and provide substantiating documentation to your company or the outfit they've hired to administer this little scam. And any money that you don't claim by the end of the year goes back to your company, with a cut of it going to the administrating company, I presume.

Sounds like a good deal. Sure, your spending is flexible. It lowers your taxable income. What could go wrong?

Well, your company might hire an outfit like CONEXIS to adminster Flexible Spending Accounts. And this is how they administer these accounts.

First, they put up a non-intuitive website from which you must download the claim forms. Then, they take a fairly straightforward claim form and "update" it, so that it is no longer straightforward, has smaller fields in which to make entries, and has also dropped vital information like the FAX number to which it must be sent. And boy it would have been nice if they had made it a PDF with fillable forms. But that might be expecting too much.

The web site prompts you to ensure that your email address and your phone number are up to date before it lets you access the main menu page. Then, the form that you fill out requests (understandably) your phone number, your email address, and your mailing address.

Then you fill in the requested information, make copies of the supporting documents and receipts to substantiate your claim, and you fax it in to them. You can also mail it in, but that is too slow. You can submit it electronically, if you have a scanner and know how to use it. So I opt for faxing to get the instant gratification of submittal with minimal computer hassle time.

Then after a couple of days you check the website, reconfirm your contact information, and check the status of your claim, which has been rejected. No reason is provided, it's just rejected.

So you call up the customer service number. The menu presents you with all sorts of options, none of which involve talking to a human. But the last option finally gives you the wherewithal to connect to an operator.

So into the on-hold queue. Every 30 seconds or so a recorded message reminds you that you could have used the website and not bothered the humans. Please Note: attempting to argue with the recording that the website is confusing and does not tell you what problem they had with your rejected claim is pretty much futile.

Finally, a person answers. Fortunately, you should be able to understand the person's voice, as it appears that they have not yet outsourced their customer service to India.

The operator will then explain to you that she too does not know why the claim was rejected, apparently they do not write this sort of thing down. Perhaps you should re-submit it. She will also explain to you how she also does not know why, despite their numerous attempts to verify my contact information, that no attempt was made to contact me regarding my rejected claim using said information.

Here is where it is considered perfectly OK to fall out of your chair.

As you have guessed, the adventure above was endured by yours truly. The claim I submitted was for about 10 months of prescription medication copayments, which is a significant chunk of change to ol' Tad and his family. I had supplied all supporting documentation as required by law. I resubmitted the claim. I am waiting to find out the results of this next go-around.

Then it dawns on me. I read The Rainmaker by John Grisham. These people are not in business to make sure that I get my money to which I am entitled. Their livelihood depends on them NOT giving my money to me. Further, there appears to be no ombudsman or overseeing body to make sure that outfits like CONEXIS are audited to make sure that they are doing their job correctly and ethically.

But with open enrollment coming up for 2007, I'm pretty much staying away from this mail-in rebate SCAM, and I encourage you to beware, if not stay away altogether. The tax benefit sure is not worth this hassle, at least to me.