How to setup a Health Care Reimbursement Account

[Milind Kamble]

Accounting Gurus:
   I searched the mail archives but found no
discussion on this topic. I would like to setup a
Health Care reimbursement account (also known as
Flexible Spending Account in the US) to track paycheck
contributions to this account, and subsequent
reimbursements.

The way I see it (I might not be accurate from an
accounting lingo perspective) is:

For every pay-period, a fixed amount gets deposited
into the HCRA. So HCRA would be an asset account. For
every paycheck, I would have
Cr Income, and Db Assets->Checking, Db Assets->HCRA
(and others)

When I visit a doctor, I pay copay by credit card. So
for this transaction, I have a Cr entry for
Liability->CrCard  and Dr entry for
Expenses->Medical->Reimbursible

When I payoff the credit card balance from my checking
account, I have a Cr entry for Assets->Checking and a
Dr entry for Liability->CrCard

Ultimately when I have a sizeable number of
transactions in Expenses->Medical->Reimbursible, I
send off a expense-report like form to the account
maintainer and get a check from them. That leads to
Db entry in Asset->Checking and Cr entry in
Asset->HCRA

Question: would this be the correct setup?
I am unsure, because there is no linkage between
transactions in Expenses->Medical->Reimbursible and
Assets->HCRA

TIA.

Milind


		
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