The Hartford Makes Flexible Spending Accounts More Attractive to Consumers with Debit Card Technology
Employees Simply Swipe at Point of Purchase to Reap Benefits of Flexible
SIMSBURY, Conn., Sept. 23 /PRNewswire-FirstCall/ -- The Hartford Financial Services Group (NYSE: HIG) now offers easy access to Flex Convenience(R), a Flexible Spending Account (FSA) program available to The Hartford's group life, accident and disability insurance customers. The service, available through Medical Group Insurance Services, Inc. (MGIS)(1) features innovative debit card technology that helps employees who want a convenient way to manage the skyrocketing costs of medical and dependent day care. "As out-of-pocket medical costs continue to climb, Flex Convenience is an effective way to help employees keep these costs in line. The ease and convenience of a plastic debit card provides a substantial benefit for our customers and their employees who want to take advantage of their flexible spending account without lots of burdensome paperwork," said Dick Mucci, executive vice president and director of The Hartford's Group Benefits Division. "Furthermore, the ability to simply swipe a card at the point of purchase helps alleviate employees' fear of losing unspent FSA funds, which currently do not roll over from year to year," he said. Ron Weltmann, CEO of MGIS added, "The advantages of the debit card are so compelling that we have seen employee participation increase as much as 300 percent over a traditional flexible spending account. Employees can pay for expenses at the point of service without paying out of pocket, submitting claim forms and waiting for reimbursement," he said. Funds deposited into an employee's flexible spending account are not subject to federal income tax and may be used to pay for qualified medical and dependent care expenses. Eligible medical expenses include co-payments, orthodontia, eyeglasses and over-the-counter medicines such as antacids, pain relievers, allergy and cold medicines. Flex Convenience also offers the potential for cost savings to employers who make it available to their employees. Each dollar that employees contribute to the flexible savings accounts is exempt from employer FICA taxes, which may produce a net positive cash flow to a company's bottom line after administrative costs. Mucci sees a unique opportunity for many small and medium sized employers who will be offering FSAs to their employees for the first time. "Introducing Flex Convenience in combination with other voluntary benefits is a great opportunity for employers, who can help their employees save on taxes, while also making available to them important life, accident and disability protection they might not otherwise have considered for themselves," Mucci said. The percentage of employers offering FSAs to their employees is expected to increase from 56 percent to 93 percent by 2010 according to Hewitt Associates. While more than 90 percent of large employers already offer paper- based FSAs, many are switching debit card programs to increase employee participation and tax savings. The Hartford is one of the nation's largest financial services and insurance companies, with 2003 revenues of $18.7 billion. The company is a leading provider of investment products, life insurance and group benefits; automobile and homeowners products; and business property-casualty insurance. The Hartford's Internet address is http://www.thehartford.com. (1) FSA administration services are provided and sold by Medical Group Insurance Services, Inc. (MGIS), one of the nation's largest insurance and benefits providers to the healthcare industry and a pioneer in the use of debit card technology for FSAs. Flex Convenience is a registered mark of MGIS. To learn more about MGIS and Flex Convenience, go to http://www.We-R-Flex.com. Some of the statements in this release may be considered forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. The Hartford cautions investors that these forward-looking statements are not guarantees of future performance, and actual results may differ materially. Investors should consider the important risks and uncertainties that may cause actual results to differ. These important risks and uncertainties include those discussed in The Hartford's Quarterly Reports on Form 10-Q, our 2003 Annual Report on Form 10-K and the other filings we make with the Securities and Exchange Commission. The Hartford assumes no obligation to update this release, which speaks as of the date issued.
SOURCE The Hartford
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