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We are posting this memo sent to Nampa School District employees as a public service to alert others who may do business with Xpress Flex. No word on the scope of the damage, but certainly not good news to folks who thought they were making a wise financial decision. There will no doubt be more on this in days to come.
“From: Westfall, Allison Subject: Problems with Xpress Flex – Please read ASAP You are receiving this email because you participate in the flexible spending plan for medical and/or child care expenses.
We discovered late last week that Xpress Flex, the company that manages our medical and child care flexible spending accounts, appears to be no longer in business and is under investigation. In addition, some of you reported that reimbursement checks issued by Xpress Flex last week “bounced.”
Several Treasure Valley employers including the Boise School District and the College of Idaho also use Xpress Flex. The Idaho Attorney General’s Office and the State Department of Insurance have been contacted.
Fortunately, we learned of this news in time to immediately take action and “stop payment” of February’s payment to Xpress Flex. No future transfers will be made to Xpress Flex. We will be working with authorities to determine how to recover the money already sent to Xpress Flex.
In the meantime, do not submit reimbursements to Xpress Flex. We hope to identify a new plan manager quickly.
Flexible spending plans follow strict Internal Revenue Service laws that require we continue the deductions authorized by the employee.
We recognize this situation impacts each of you differently. Please feel free to contact Jane Barker at firstname.lastname@example.org or ext. 1054 or Steve Kipp at email@example.com or ext. 1042.”
UPDATE NOON TUESDAY: We contacted Boise School benefit office and they said they were “aware there are problems and we are working toward a resolution.” They had not notified their employees of the situation
UPDATE 3p.m. TUESDAY: Boise Schools administration sent a memo to employees confirming the company has gone out of business. IRS and Idaho Attorney General are involved and we are told there may be “hundreds of employers” affected by the demise of Xpress Flex.
Dear Employee, You are receiving this e-mail because you are a participant in the District’s Section 125 medical flex plan, and/or the dependent care reimbursement plan.
Late Friday afternoon, it was brought to the District’s attention that our Flexible Spending Account (FSA) administrator, XpressFlex, was no longer processing reimbursement requests and that some reimbursement checks did not clear the bank. Today March 2, 2010, we officially received an e-mail verifying XpressFlex is no longer in business.
We want you to know that we are working with another company to assume the administration of our plan as soon as possible, so that your claims will continue to be processed. We will be contracting with Flex-Plan Services, (Bellingham, Washington) to continue the administration of our former plan with XpressFlex. Flex Plan Services is a reputable agency and has been in the business for over 20 years. Flex-Plan Services is working with the District to gather the data in order to take over our plan. In the meantime, we ask you do not submit reimbursement requests to XpressFlex. We will send you an e-mail once the plan is established and Flex-Plan Services is ready for transactions. You will also receive a welcome letter and additional information from Flex-Plan Services in the near future.
Please understand that IRS regulations do not allow employees to discontinue participation in our Section 125 flex plan for the remainder of the plan year – short of experiencing a qualifying family status change. We do not yet have answers to questions about the status of year-to-date contributions, how much flex money is available for the remainder of the plan year, or if plan members will lose money they have already contributed. We are working diligently to answer these questions. We continue to be in contact with XpressFlex, the State Attorney General, legal counsel, and other Treasure Valley employers who are in the same position as the Boise School District. We will share with you relevant information as it becomes available. If you have questions, you may e-mail firstname.lastname@example.org