Discovery Benefits, Inc.

Final Consumer Response /* (2000, 5, 2015/09/15) */
[redacted] called and is working out internally and wants this complaint closed as resolved.

Discovery Benefits is a third party administrator that provides reimbursement account administrative services on behalf of employers pursuant to service contracts with the employer. Discovery Benefits does not sell directly to individuals and does not have individual service agreements with...

employees or participants. IRS rules govern substantiation requirements for the health FSA, including expenses paid using the debit card.  Included below are excerpts from the IRS regulations governing substantiation requirements. 1.125-6(b)(2) All claims must be substantiated. As a precondition of payment or reimbursement of expenses for qualified benefits, a cafeteria plan must require substantiation in accordance with this section. Substantiating only a percentage of claims, or substantiating only claims above a certain dollar amount, fails to comply with the substantiation requirements in §1.125-1 and this section. 1.125-6(3)(i) In general. All expenses must be substantiated by information from a third-party that is independent of the employee and the employee’s spouse and dependents. The independent third-party must provide information describing the service or product, the date of the service or sale, and the amount. Self-substantiation or self-certification of an expense by an employee does not satisfy the substantiation requirements of this paragraph.  According to its standard process regarding substantiation, Discovery Benefits emailed this participant two Receipt Reminders prior to denying claims and requesting repayment.  Even though debit card transactions may be denied due to lack of or insufficient documentation, the merchant remains paid.  When the debit card is suspended, the participant may still submit requests for reimbursement using an Out of Pocket Reimbursement Request Form, filing a claim online through the member portal or submit the claim via the mobile app.  Discovery Benefits will send a more detailed letter directly to the participant as well.

Initial Business Response /* (1000, 5, 2015/12/23) */
The participant used her debit card to pay for a service on March 30, 2015. Discovery Benefits emailed a Request for Substantiation Documentation reminder to the participant on April 3, 2015 and again on May 2, 2015. When no documentation was...

received, Discovery Benefits denied the claim with a repayment request on June 13, 2015. Because the claim remained unsubstantiated for more than 72 days, the debit card was placed in a suspended status. A Denial Letter with Repayment notification was emailed to the participant on June 17, 2015.
Discovery Benefits received documentation for this claim on December 15, 2015. IRS regulations require that documentation include a date of service, type of service and amount charged. The documentation provided showed a balance forward but no date or type of service. The claim was denied as Previous Balance and Discovery Benefit emailed a Denial Letter with Repayment notification to the participant on December 16, 2015.
All other claims from this participant for the current plan year were auto-approved at the point of transaction.
If the participant has questions regarding the denial or communication, we recommend she contact Discovery Benefits. There is no record of this participant contacting Discovery Benefits.
Complaint Response Date bumped because: Holiday

There was no error made by Discovery Benefits. The dependents were added retroactively once we received confirmation from the carrier of the start date of the dependents coverage (date of birth vs first of month following birth). When the coverage level changed, the premium went up and the automated system terminated the qualified beneficiary due to the timing of the changes. Discovery Benefits contacted the participant to explain the details of the dependents being added retroactively.  We advised her of the new premium amount and told her what she needed to pay in order to pay current. The payment was received on February 20, 2018 and was applied on February 26, 2018 due to it having to be applied manually because the account was in a terminated status at that time. An urgent update request is being sent to the carrier to reinstate coverage without lapse.

I am rejecting this response because: I want a resolution without hassle. So far they have been circling around and looking for excuses. I feel like I have aiming at a moving goal line.

Discovery Benefits is a third party administrator that provides reimbursement account administrative services on behalf of employers pursuant to service contracts with the employer. Discovery Benefits does not sell directly to individuals and does not have individual service agreements with...

employees or participants. IRS rules govern substantiation requirements for the flexible spending accounts, including expenses paid using the debit card.  See 1.125-6(b)(2) and 1.125-6(3)(i).The individual submitted documentation for three debit card transactions.  Based on the documentation provided, two of the transactions were approved in full.One of the transactions was partially approved with the remaining amount denied because it was covered by insurance. The documentation also showed one of the payments was a prepayment for an expense in a future plan year.  IRS rules only allow reimbursement for eligible expenses that have been incurred during the plan year.  Prepaid expenses cannot be reimbursed until after the expense has been incurred.  Based on the documentation submitted by the individual on October 12, 2017, there are no other expenses that can be approved.Discovery Benefits' Participant Services operates as an incoming call center to respond to inquiries from participants. When a supervisor is available, the call is transferred when requested. If no supervisor is available, the participant will receive a call back from a supervisor within 24 hours.  During each call, the representative offered to enter a request for a supervisor to call her back within 24 hours. Each time, the participant declined. One of the calls was ended by the Discovery Benefits customer service representative when the participant demanded to hold for a supervisor after declining repeated offers for a call back.  Upon review of the calls, Discovery Benefits finds the customer service representatives treated the participant with respect at all times.

Discovery Benefits is a third party administrator that provides reimbursement account administrative services on behalf of employers pursuant to service contracts with the employer. IRS rules governing substantiation requirements for the flexible spending accounts require that all claims must...

be substantiated, even those paid using the debit card. See 1.125-6(b)(2) and 1.125-6(3)(i).  All expenses must be substantiated by information from a third-party that is independent of the employee and the employee’s spouse and dependents. The independent third-party must provide information describing the service or product, the date of the service or sale, and the amount.The original documentation submitted by this participant did not include the type of service. Discovery Benefits received additional substantiation which included the required information.  The request has been reprocessed and the substantiation requirement has been satisfied.Even though debit card transactions may be denied due to lack of or insufficient documentation, the merchant remains paid.

Initial Business Response /* (1000, 6, 2015/07/29) */
The participant terminated his employment with his former employer effective January 31, 2015.
Based on the terms of the employer's plan, terminated participants may submit claims for employment related dependent care expenses for claims...

incurred up to the date of termination that are submitted within 90 days after termination. This information was included in the Summary Plan Description (SPD) provided to the participant by his former employer. The participant's final filing date was May 1, 2015. The funds are no longer available to the participant as it is beyond the final filing date of the plan and the funds have been forfeited to the employer in accordance with the plan document.
The following can be found under Section V Benefit Payments, subsection 5(b) of the SPD:
5. What happens if I terminate employment?
If you terminate employment during the Plan Year, your right to benefits will be determined in the following manner:
(b) You will still be able to request reimbursement for qualifying dependent care expenses incurred prior to your date of termination from the balance remaining in your dependent care account at the time of termination of employment. However, no further salary redirection and Employer contributions will be made on your behalf after you terminate. You must submit claims within 90 days after termination.
Initial Consumer Rebuttal /* (3000, 8, 2015/07/30) */
(The consumer indicated he/she DID NOT accept the response from the business.)
First, Discovery Benefits denied me this information on the phone. They said "no one has your money".... Both the first person I spoke to, as well as the supervisor, told me "I didn't understand." They are clearly now trying to be nice by finally trying to explain this. They are also backtracking, because they told me "no one had my money" - not even the former employer. They owe me an apology for this, too.
The IRS says that I have a calendar year to file a claim. Can Discovery's rules supersede the IRS's terms? Based on how I read the IRS information attached in my original complaint, I should have the full calendar year to file a claim. Discovery is denying my right to file a claim within the calendar year.
Thank you for this opportunity.
Final Business Response /* (4000, 10, 2015/08/04) */
The Plan document governs the terms of the Plan within the regulations set forth by the Internal Revenue Service. The Plan in which this participant was enrolled allows terminated employees to submit claims for employment related dependent care expenses incurred up to the date of termination within 90 days after termination. Based on the termination date supplied to Discovery Benefits this participant had until May 1, 2015 to submit claims for expenses incurred up until his last day of employment.

The participant attached a copy of the denial and repayment notice to his complaint.  Documentation submitted on August 4, 2017 did not include a form or the claim number so additional research was required in order to determine the claim.  The documentation was processed this morning and the full amount was approved in full.

I am rejecting this response because:
The documentation  has been submitted more then once, with the requested information needed. I clearly see all information is there when I’m submitting the documents. It may be on seperate documents/pages but it’s all there.

Initial Business Response /* (1000, 5, 2016/02/26) */
Discovery Benefits is a third party administrator that provides COBRA administrative services on behalf of employers pursuant to service contracts with the employer. Discovery Benefits does not sell directly to individuals and does not have...

individual service agreements with employees, participants or qualified beneficiaries.
Discovery Benefits is not an insurance carrier and does not have access to or control of the records or processes of insurance carriers.
Discovery Benefits processed the participant's open enrollment benefit changes on December 31, 2015 and according to its normal process, on January 4, 2016 notified the carrier of the addition of the new coverage effective January 1, 2016. In addition, according to its normal process, Discovery Benefits notified the carrier of the termination of the old coverage effective December 31, 2015 on January 11, 2016.
Discovery Benefits communicated the update to the participant's carrier again on January 18, 2016 and February 17, 2016. On February 24, 2016, Discovery Benefits received confirmation from the carrier of the reinstatement in the correct plan effective January 1, 2016. Discovery Benefits contacted the participant by phone on February 24, 2016 and provided to the participant the member identification number given by the insurance carrier.
Initial Consumer Rebuttal /* (2000, 7, 2016/03/01) */
My issue is resolved

Discovery Benefits provides COBRA administrative services on behalf of employers pursuant to service contracts with the employer.  Employers hire Discovery Benefits to administer COBRA in accordance with federal COBRA regulations and it is a requirement of our service agreements with employers that we do so.  This includes COBRA payment deadlines.

Discovery Benefits is a third party administrator that provides pre-tax reimbursement account administrative services on behalf of employers pursuant to services agreements with the employer. Under its services agreement, employers are responsible to fund all benefit payments.
The...

reimbursement accounts are set up as notional accounts within the recordkeeping system and are not funded. Funds are maintained in the employer’s general assets. The employer for this participant utilizes the deduction based funding arrangement. Under this type of funding arrangement, the employer maintains a minimum account balance with Discovery Benefits that is used to reimburse claims as participant reimbursement requests are submitted. When utilization exceeds the balance maintained on reserve for the employer, Discovery Benefits notifies the employer requesting additional funds. Until additional funds are received, claim reimbursements are suspended for the entire plan and debit cards are suspended.
Discovery Benefits is working with the employer to ensure additional funding is received. Once received, pending claims will be processed and debit cards will be reactivated.

Discovery Benefits is a third party administrator that provides reimbursement account administrative services on behalf of employers pursuant to service contracts with the employer. Discovery Benefits does not sell directly to individuals and does not have individual service agreements with...

employees or participants.
Due to the amount of personal information required for a complete response, Discovery Benefits will send a letter directly to the participant and not respond through the Revdex.com.

Discovery Benefits is a third party administrator that provides transportation fringe benefit plan administrative services on behalf of employers pursuant to service contracts with the employer. According to the employer-sponsored transportation plan under which this participant was enrolled,...

terminated employees are allowed 30 days from their last date as an active employee to file for reimbursement of expenses incurred while an active employee. This information would have been provided in the transportation plan summary provided by the employer to all participants in the plan.According to the information supplied to Discovery Benefits, this participant’s last active date in the plan and last date to incur services was November 23, 2017, making the final filing date December 23, 2017. The participant attempted to file for reimbursement on December 26, 2017, after the final filing date. All funds forfeited are returned to the employer-sponsored plan. Discovery Benefits does not retain any forfeited funds.

Revdex.com:
I have reviewed the response made by the business in reference to complaint ID [redacted], and find that this resolution is satisfactory to me provided I do in fact hear from DBI within 10 business days. If not I will reinstate my complaint.

I am rejecting this response because:I received new insurance cards that states my effective date as 4/1/16 therefore the same problem exists and has not been resolved. I had to reschedule my appointment again to after the effective date of 4/1/16.  Someone is dropping the ball here and not doing their job. Proper follow up needs to be done to assure that my issue is fixed correctly and good customer service would be to also follow up with the client/me to let me know you have done your job and it has been fixed not just that you sent a paper to someone. Sara the supervisor for sure should be handling this personally and needs to go to a customer service workshop!  The fact that they keep blaming the other party just shows that they don't care or want anything to do with the problem. I have put more time and effort into fixing this then they have!  Do you job and I want proof that it's right because as of now I have cards with an effective date of 4/1/16.

Discovery Benefits is a third party administrator that provides pre-tax reimbursement account administrative services on behalf of employers pursuant to service contracts with the employer. Discovery Benefits does not sell directly to individuals and does not have individual service agreements with...

employees or participants.
The participant’s termination of employment date as reported to Discovery Benefits was October 12, 2015. According to the design of the plan under which she was enrolled, the participant’s final filing date was January 10, 2016. Due to confusion on the part of the customer service representative with whom the participant spoke, an exception was made to allow the documentation after the final filing date.  The participant’s documentation has been accepted and the 2015 claims reprocessed and paid on April 4, 2016.
Discovery Benefits places the utmost importance on customer service and we take participant feedback very seriously. Upon review of this participant’s experience, a training concern has been identified and addressed with the appropriate team. We apologize for the customer service experienced by this participant.

I am rejecting this response because:There is NO plausible excuse for taking 3 weeks to process a payment in the 21st century.  I'm torn whether I believe the malfesance of Discovery Benefits is attributable to being merely supremely incompetent or whether to being deliberately malicious.  Either way, their conduct is utterly inexcusable.  I have filed civil suit agaist Discovery Benefits seeking $10,000.00 in damages for no receiving service for the months paid and for mental anguish, pain and suffering due to their unexplainable delays and misinformationn.  Waiting to see how long their lawyers leave the judge on hold.

Revdex.com:
I have reviewed the response made by the business in reference to complaint ID [redacted], and find that this resolution is satisfactory to me. I would like to add that it is disappointing that it took a complaint the the Revdex.com to get this matter resolved, Discovery Benefits should make supervisors more accessible to clients in order to resolve issues like this in a more timely manner. I now have the frustrating task of getting all my claims re-submitted because they voided my insurance.