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Does the employee pay for the item first then make a claim?

Yes. The employee pays for their health and dental expenses personally. To be reimbursed, the employee submits a HealthCare Spending Account claim using their online account. A cheque or direct deposit is issued to the employee for the eligible amount of the claim, providing there is a sufficient un-used "limit" in their account. Funding for the whole transaction comes from the company and a notification is sent from the online system to the Plan Administrator when money is needed.