Plan Administrators

The Internal Revenue Service (IRS) has set forth regulations for FSA/HRA plans, including the rules for employers and their plan administrators as well as what’s required for merchants to accept FSA/HRA debit cards. The IRS has defined two ways in which merchants can support FSA/HRA cards. One is called an inventory information approval system, or IIAS, and the other is for a drug store or pharmacy to be registered as a 90% Rule merchant.

Membership in SIGIS offers plan administrators the ability to enable their FSA/HRA debit card programs to support acceptance at both IIAS and 90% Rule programs. For plan administrators, SIGIS offers:

SIGIS Eligible Product List – the SIGIS List is a valuable resource in the development of plan criteria for identifying eligible products. The SIGIS List represents a unique tool that provides an industry-vetted list of eligible products that can be used in the administration of FSA/HRA card programs. See the Eligible Product List Criteria publication for more information.
Regulatory Impact – SIGIS actively engages with the IRS and Treasury Department on rules impacting the use of health benefit cards. SIGIS has led efforts to clarify item eligibility and changes required by the Patient Protection and Affordable Care Act.
Education – Receive SIGIS communications on important issues that impact regulations, card usage and approvals.
Help Desk – Ability to contact SIGIS Help Desk as a educational resources for card acceptance.

Related FAQs

At times, we see that FSA or HRA cards may work at some stores of a certified merchant, but not at other store locations. What could cause that?

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At times, we see that FSA or HRA cards may work at some stores of a certified merchant, but not at other store locations. What could cause that?

It is possible that the merchant has a phased implementation of IAS capabilities. If the merchant's implementation date is listed as "Live" and a plan administrator continues to experience problems with card usage, please speak with your transaction processor.
Is it required that merchants download the SIGIS product list?

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Is it required that merchants download the SIGIS product list?

One of the critical issues in supporting an IIAS solution for employer benefit plans and the third-party plan administrators (TPAs) that support these programs, is assurance that the items being approved through an IIAS solution meet the health care eligibility standards established by the IRS as defined in IRS Code Section 213(d) rules. As described above, SIGIS provides a standardized list of eligible health care-related items. While the IRS does not mandate the use of the SIGIS list, merchants supporting a SIGIS IIAS solution must use the SIGIS Eligible Product List for nationally-branded items. In addition, merchants may also flag private label and local market items as defined in the SIGIS Private Label Eligibility Criteria standards.

In some point-of-sale solutions, the third-party services may assist with loading the monthly updates to the merchants POS system.
The cardholder swiped their card, but the TPA does not see a transaction, why?

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The cardholder swiped their card, but the TPA does not see a transaction, why?

When TPAs experience transaction issues, they should speak with their card processor for specific details. It is possible that the cardholder was attempting to purchase items that the merchant did not have identified as SIGIS qualified items and, therefore, did not submit the transaction for authorization against the card identified as being for health care purchases.
Confirm your SIGIS IIAS Certification status
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Confirm your SIGIS IIAS Certification status
As a paid Member of SIGIS in good standing, a merchant is able to confirm the status of its SIGIS IIAS Certification by going to www.sig-is.org and clicking on IIAS Merchant List.

A Member’s DBA Names (doing business as name) will be posted on the IIAS Merchant List under the following parameters.
- If the Membership is listed as "Certified", the merchant has completed the IIAS Certification process
Please note that the list is published at 5pm each business day.
What about a merchant’s data retention requirements?

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What about a merchant’s data retention requirements?

The IRS requires that merchants be able to retrieve the product detail associated with an IIAS transaction for a period of five (5) years. The data retention requirements are published in the SIGIS Technical Specification.
What's happening to meet the data retention requirement?

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What's happening to meet the data retention requirement?

SIGIS has developed data retention requirements. It is the responsibility of participating IIAS merchants to ensure that data retrieval requests and responses are supported to enable plan administrators to meet IRS audit requests.
What new values will TPAs have to authorize against with the SIGIS standard?
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What new values will TPAs have to authorize against with the SIGIS standard?
In addition to the total dollar amount of the purchase, merchants will now be able to provide the:
- Health Care Eligible Total - This represents the total dollar value of all health care eligible items in the purchase.
- Rx/Prescription Total - This total represents a subtotal of the Health Care Eligible purchases that are Rx/prescriptions.
Where can TPAs find a list of certified merchants?

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Where can TPAs find a list of certified merchants?

SIGIS maintains a list of Member merchants who have submitted their certification materials and self-assessment forms to SIGIS. The list may be viewed on the SIGIS website. The list is for informational purposes, TPA’s and their authorization partners should rely on the data transmitted in the authorization request by the merchant for transaction authorization.
Who will have access to this information when a consumer has an inquiry?

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Who will have access to this information when a consumer has an inquiry?

The SIGIS 90% Rule Merchant List is available to the general public via the SIGIS website. Specific questions about card declines and plan rules should be directed to the plan administrators' phone number on the back of the consumer’s FSA/HRA card.
Why do TPAs see some transactions with an Rx Amount and some without?

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Why do TPAs see some transactions with an Rx Amount and some without?

The prescription subtotal is optional for merchants to support when implementing their IIAS systems. For a list of merchants that support the Rx subtotal, please go to the IIAS Merchant List at www.sig-is.org . The "Supporting Prescription Subtotal" column indicates which merchants have chosen to provide the prescription subtotal in their card authorization requests.
How do FSA/HRA card issuers know which merchants have registered with SIGIS?

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How do FSA/HRA card issuers know which merchants have registered with SIGIS?

SIGIS will publish a list of SIGIS Members that have registered as 90% Rule merchants. Additionally, SIGIS will publish the acquirer ICA/BIN and Card Acceptor IDs of these merchants each week. Issuers and issuer processors that elect to participate in the 90% Rule should use the 90% Rule SFTP Report. The issuer processor should use the ICA, BIN, CAID and MCC code in the authorization process to determine if it is a 90% Rule merchant. Other fields should not be use as doing so may cause unneeded declines. The public 90% Rule report should be used as an informational guide when working with merchants. Issuer and issuer processors must be a SIGIS Member to download the list.
How often is the IIAS merchant list updated?

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How often is the IIAS merchant list updated?

The IIAS Merchant List is updated daily at 5am as updates are available. The 90% Merchant List is updated each Monday morning at 5pm.
Is a Merchant required to make IIAS changes to accept FSA/HRA cards?

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Is a Merchant required to make IIAS changes to accept FSA/HRA cards?

No. A merchant is not required to implement an IIAS; however, FSA/HRA card issuers will not be able to approve FSA/HRA card transactions when a merchant does not support an IIAS. If you are a merchant and choose not to implement an IIAS, you do not need take additional steps. Merchants that are pharmacies/drug stores and primarily sell prescriptions and medical items may qualify under the IRS rules as a “90% Rule” merchant. See the 90% Rule Merchant FAQs for more information.

For merchants that would like to accept the FSA/HRA cards of their customers, the IRS requires Merchants selling health care eligible products to support an Inventory Information Approval System (IIAS). The IIAS system is a combination of inventory management and point-of-sale systems that can verify the health care eligibility of items purchased with a FSA or HRA debit card, generate a payment transaction that contains the required IIAS information, and includes an information archive system that allows the merchant to respond to an IRS audit(s) as required. As noted above, for Drug Stores / Pharmacies where 90% of the sales on a store-by-store basis qualify as FSA-eligible, a 90% Rule registration program is an alternative option.

Merchants have the option to not become a Member of SIGIS by establishing their own IIAS standards or 90% Rule Exemption and working with third-party plan administrators individually.

With the IIAS Certification developed by SIGIS, a non-profit standards organization, a broad range of participating merchants have been able to implement a solution that is recognized industry-wide, which enables acceptance of most FSA/HRA payment cards. Likewise, third-party plan administrators have implemented a common set of procedures that are applied to IIAS transactions at participating merchants.
If a merchant implements IIAS, is it at all their registers?

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If a merchant implements IIAS, is it at all their registers?

It is possible that the IIAS system has been installed in specific locations within a store, the pharmacy for example, and not all registers within the store. If there is any question, please ask the store for more information.
Confirm your 90% Rule Self-Registration status

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Confirm your 90% Rule Self-Registration status

As a paid Member of SIGIS in good standing, a merchant is able to confirm the status of its SIGIS Registration for the 90% Rule Exemption by going to www.sig-is.org and clicking on 90% Rule Merchant List. If the merchant’s organization is not on the list, the merchant will need to complete the online form to complete registration for the 90% Rule.

Please note that the list is updated each Monday morning.
What if a plan administrator and/or consumers have questions or inquiries about a possible error with the SIGIS 90% Rule merchant information, who will address the questions?

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What if a plan administrator and/or consumers have questions or inquiries about a possible error with the SIGIS 90% Rule merchant information, who will address the questions?

Consumers contact their plan administrator to ask questions about merchants at which their FSA/HRA card will work. Only plan administrators can answer these questions. Plan administrators should research cardholder questions via their transaction processing systems to determine what may have caused a cardholder's problem. If the plan administrator believes that SIGIS 90% Rule merchant information may not be accurate, they should contact their card issuer processor for assistance.
How often is SIGIS 90% Rule merchant information updated?

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How often is SIGIS 90% Rule merchant information updated?

SIGIS will post an updated SIGIS Member merchant file weekly on Mondays by 8am ET with changes (adds, deletes, modifications) so that issuers/issuer processors may access the updated information. In addition, SIGIS will post a full replacement file each week. Issuers/issuer processors must update and post updated 90% Rule merchant information no less than once a month. It is highly recommended that the file be picked up and applied each week.
If a merchant can qualify its stores under the 90% Rule, will customers that pay with a FSA/HRA card need to submit sales receipts to their plan administrator?

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If a merchant can qualify its stores under the 90% Rule, will customers that pay with a FSA/HRA card need to submit sales receipts to their plan administrator?

Generally, yes. Unlike an IIAS where the merchant substantiates the items being purchased at the point of sale, the 90% Rule indicates that stores that qualify as 90% locations can be viewed as "health care merchants." This means that plan administrators will apply their standard substantiation processes to transactions at these locations - and the customer may be asked to submit a sales receipt to document that the items being purchased were Rx/prescriptions or Eligible Health Care Products. It is possible that in some cases the card issuer processor will be able to match a transaction amount with Pharmacy Benefit Management (PBM) system information, and can determine that the card transaction amount matches the plan's co-pay on prescriptions, for example. In this case, the customer may not be asked to submit a sales receipt. But in the absence of an automated matching program like this, it is likely that customers using a FSA/HRA card will be asked by their plan administrator to submit a sales receipt.
Where can cardholders, card issuers and plan administrators obtain a list of the 90% Rule registered merchants?

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Where can cardholders, card issuers and plan administrators obtain a list of the 90% Rule registered merchants?

There is a link to the 90% Rule Merchant List on the SIGIS Home Page. The SIGIS 90% Rule Merchant List contains the name and address of each store that eligible SIGIS Member merchants have registered. This is for informational purposes and should not be used for the actual authorization process. Issuer processors should rely solely on the 90% Rule SFTP Report for authorization as it contains the MCC, BIN, ICA and CAID codes to uniquely identify merchant store locations during the authorization process.