34 Tex. Admin. Code § 85.1 - Introduction and Definitions
(a) Summary. The
purpose of these rules is to govern the flexible benefits program. These rules
constitute the Plan document for the State of Texas Employees Flexible Benefit
Program (TexFlex). The flexible benefits plan (the plan) includes reimbursement
account arrangements with optional benefits available for selection by
participants as described in the plan and these rules. The plan is intended to
be qualified under the Internal Revenue Code (the Code), §125, as amended
from time to time, and is intended to continue as long as it qualifies under
§125 and is advantageous to the state and institutions of higher education
employees. Optional benefits offered under the plan for individual selection
consist only of a choice between cash and certain statutory nontaxable fringe
benefits as defined in the Code, §125, and regulations promulgated under
the Code, §125. The plan may also include separate benefits as defined in
the Code, §132, and regulations promulgated under the Code, §132,
separate from the cafeteria plan, and governed by individual plan
documents.
(b) Applicability of
rules.
(1) These rules are applicable only to
employees as defined in these rules, and terminated employees, as described in
§
85.3(b)(1)(B) and
(C) of this title (relating to Eligibility
and Participation).
(2) An employee
who retired or separated from employment prior to September 1, 1988, shall not
be entitled to benefits under the provisions of the plan and these rules,
unless the employee is rehired and then becomes eligible for
benefits.
(c)
Definitions. The following words and terms when used in this chapter, shall
have the following meanings, unless the context clearly indicates otherwise,
and wherever appropriate, the singular includes the plural, the plural includes
the singular, and the use of any gender includes the other gender.
(1) Act--The state law that authorized the
establishment of a flexible benefits plan and is designated in the Texas
Insurance Code, Chapter 1551, as amended.
(2) Account--A record keeping account
established by the Employees Retirement System of Texas or its designee in the
name of each participant for the purpose of accounting for contributions made
to the account and benefits paid to a participant.
(3) Active duty--The expenditure of time and
energy in the service of an employer as defined in these rules. An employee
will be considered to be on active duty on each day of a regular paid vacation
or on a non-work day, on which the employee is not disabled, if the employee
was on active duty on the last preceding work day.
(4) Board of trustees--The board of trustees
of the Employees Retirement System of Texas (ERS).
(5) Code--The Internal Revenue Code, as
amended from time to time.
(6)
Compensation--A participant's base salary, including amounts that would
otherwise qualify as compensation but are not received directly by the
participant pursuant to a good faith, voluntary, written or electronic salary
reduction agreement in order to finance payments to a deferred compensation or
tax sheltered annuity program specifically authorized by state law or to
finance benefit options under this plan, plus longevity and hazardous duty pay
and including non-monetary compensation, the value of which is determined by
the Employees Retirement System of Texas, but excluding overtime pay.
(7) Debit Card--A bank issued convenience
card or similar technology approved by the plan administrator and permitted to
be used by participants as an optional method to pay for eligible transactions.
Use of the card is governed by the plan administrator and issuing financial
institution. The card is referred to as the Flex Debit Card.
(8) Dependent--An individual who qualifies as
a dependent under the Code, §152, and when applicable taking into account
the Code, §105, or any individual who is:
(A) except as provided by §
85.6(b)(3) of
this title, a dependent of the participant who is under the age of 13 and with
respect to whom the participant is entitled to an exemption under the Code,
§151, or, is otherwise, a qualifying individual as provided in the Code,
§21; or
(B) a dependent or
spouse of the participant who is physically or mentally incapable of caring for
himself or herself.
(9)
Dependent care reimbursement account--The bookkeeping account maintained by the
plan administrator or its designee used for crediting contributions to the
account and accounting for benefit payments from the account.
(10) Dependent care reimbursement plan--A
separate plan under the Code, §129, adopted by the board of trustees, and
designed to provide payment or reimbursement for dependent care expenses as
described in §
85.5(c) of this
title (relating to Benefits).
(11)
Dependent care expenses--Expenses incurred by a participant which:
(A) are incurred for the care of a dependent
of the participant;
(B) are paid or
payable to a dependent care service provider or to the participant as
reimbursement for such expenses; and
(C) are incurred to enable the participant to
be gainfully employed for any period for which there are one or more dependents
with respect to the participant. Dependent care expenses shall not include
expenses incurred for the services outside the participant's household for the
care of a dependent, unless such dependent is a dependent under the age of 13
(or through age 14 as provided by §
85.6(b)(3) of
this title) with respect to when the participant is entitled to a tax deduction
under the Code, §151, or a dependent who is physically or mentally
incapable of self support. In the event that the expenses are incurred outside
the dependent's household, the dependent must spend at least eight hours each
day in the participant's household. Dependent care expenses shall be deemed to
be incurred at the time the services to which the expenses relate are
rendered.
(12) Dependent
care service provider--A person or a dependent care center (as defined in the
Code, §21) who provides care or other services described in the definition
of "dependent care expenses" in this section, but shall not include:
(A) a related individual described in the
Code, §129; or
(B) a dependent
care center which does not meet the requirements of the Code,
§21.
(13) Effective
date of the plan--September 1, 1988.
(14) Election form--A paper or electronic
form provided by the Employees Retirement System of Texas that is an agreement
by and between the employer and the participant, entered into prior to an
applicable period of coverage, in which the participant agrees to a reduction
in compensation for purposes of purchasing benefits under the plan.
(15) Eligible employee--An employee who has
satisfied the conditions for eligibility to participate in the plan in
accordance with the plan and §
85.3(a)(1), and (b)(1)
of this title (relating to Eligibility and
Participation), and, to the extent necessary, a retired or terminated employee
who is entitled to benefit payments under the plan.
(16) Employee--A person who is eligible to
participate in the Texas Employees Group Benefits Program as an
employee.
(17) Employer--The State
of Texas, its agencies, commissions, institutions of higher education, and
departments, or other governmental entity whose employees are authorized to
participate in the Texas Employees Group Benefits Program.
(18) Expenses incurred--Expenses for services
received or performed and for which the participant is legally
responsible.
(19) Executive
director--The executive director of the Employees Retirement System of
Texas.
(20) Flexible benefit
dollars--The dollars available to a participant which may be used for purposes
of purchasing benefits under the plan.
(21) General purpose health care
reimbursement account--The account described in §85.5(b)(1).
(22) Grace period--A two (2) month and 15 day
period, adopted by the TexFlex plan pursuant to IRS Notice 2005-42, immediately
following the end of the plan year during which participants may continue to
incur expenses for reimbursement from the prior year account balance. The grace
period does not apply to a health care reimbursement plan year that begins on
or after September 1, 2014, but does apply to the dependent care reimbursement
plan, except as limited by §
85.6(b)(2) of
this title.
(23) Health care
expenses--Any expenses incurred by a participant, or by a spouse or dependent
of such participant, for health care as described in or authorized in
accordance with the Code, §105 and §213, but only to the extent that
the participant or other person incurring the expense is not reimbursed for the
expense by insurance or other means. The types of expenses include, but are not
limited to, amounts paid for hospital bills, doctor bills, prescription drugs,
hearing exams, vision exams, and eye exams.
(24) Health care reimbursement account--The
bookkeeping account maintained by the plan administrator or its designee used
for crediting contributions to the account and accounting for benefit payments
from the account.
(25) Health care
reimbursement plan--A separate plan, under the Code, §105, adopted by the
board of trustees, and designed to provide health care expense reimbursement as
described in §
85.5(b) of this
title (relating to Benefits).
(26)
Institution of higher education--All public community/junior colleges, senior
colleges or universities, or any other agency of higher education within the
meaning and jurisdiction of the Education Code, Chapter 61, except the
University of Texas System and the Texas A&M University System.
(27) Leave of absence without pay--The status
of an employee who is certified monthly by an agency or institution of higher
education administrator to be absent from duty for an entire calendar month,
and who does not receive any compensation for that month.
(28) Limited purpose health care
reimbursement account--The account described in §85.5(b)(3).
(29) Option--Any specific benefit offering
under the plan.
(30)
Participant--An eligible employee who has elected to participate in the plan
for a period of coverage.
(31)
Period of coverage--The plan year during which coverage of benefits under the
plan is available to and elected by a participant; however, an employee who
becomes eligible to participate during the plan year may elect to participate
for a period lasting until the end of the current plan year. In such case, the
interval commencing on such employee's entry date and ending as of the last day
of the current period of coverage shall be deemed to be such participant's
period of coverage.
(32) Plan--The
flexible benefits plan established and adopted by the board of trustees
pursuant to the laws of the state of Texas and any amendments which may be made
to the plan from time to time. The plan is referred to herein as TexFlex, and
is comprised of a dependent care reimbursement plan, a health care
reimbursement plan, an insurance premium conversion plan, and a qualified
transportation benefit plan.
(33)
Plan administrator--The board of trustees of the Employees Retirement System of
Texas or its designee.
(34) Plan
year--A 12-month period beginning September 1 and ending August 31.
(35) Run-out period--The period following the
end of the plan year between September 1 and December 31, during which
participants may file claims for reimbursement of expenses incurred during the
plan year.
(36) Statutory
nontaxable benefit--A benefit provided to a participant under the plan, which
is not includable in the participant's taxable income by reason of a specific
provision in the Code and is permissible under the plan in accordance with the
Code, §125.
(37) Spouse--The
person to whom the participant is married. Spouse does not include a person
separated from the participant under a decree of divorce, or
annulment.
(38) TexFlex--The
flexible benefits plan adopted by the board of trustees.
(39) Texas Employees Group Benefits Program
(GBP)--The employee insurance benefits program administered by the Employees
Retirement System of Texas, pursuant to Texas Insurance Code, Chapter 1551. The
program consists of health, voluntary accidental death and dismemberment,
optional term life, dependent term life, short and long term disability,
vision, and dental insurance coverages.
(40) Third Party Administrator or TPA--The
vendor, administrator or firm selected by the plan administrator to perform the
day-to-day administrative responsibilities of the TexFlex program for
participants of the Texas Employees Group Benefits Program who enroll in either
the health care reimbursement plan, dependent care reimbursement plan or
both.
Notes
State regulations are updated quarterly; we currently have two versions available. Below is a comparison between our most recent version and the prior quarterly release. More comparison features will be added as we have more versions to compare.
No prior version found.