HSA and FSA Cards Acceptance

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Eligible MCC Code

In order to accept HSA or FSA cards for transactions, merchants must have an eligible MCC code or 90% registration. 

An HSA/FSA card’s particular plan will define a list of eligible Merchant Category Codes (assigned to your business account, set by the card associations). These merchant categories are defined as health care providers because the services they offer are strictly health care related. MCC examples are below:

• 5975 – Hearing Aids-Sales, Service, Supply Stores

• 4119 – Ambulance Services (Dependent on Plan Administrator)

• 5976 – Orthopedic Goods-Artificial Limb Stores

• 7277 – Debt, Marriage, Personal-Counseling Service (Dependent on Plan Administrator)

• 8011 – Doctors-not elsewhere classified

• 8021 – Dentists, Orthodontists

• 8031 – Osteopathic Physicians

• 8041 – Chiropractors

• 8042 – Optometrists, Ophthalmologists

• 8043 – Opticians, Optical Goods, and Eyeglasses

• 8049 – Chiropodists, Podiatrists

• 8050 – Nursing and Personal Care Facilities

• 8062 – Hospitals

• 8071 – Dental and Medical Laboratories

• 8099 – Health Practitioners, Medical Services-not elsewhere classified

SIGIS Registration

90% Registration

This registration must be completed with SIGIS Organization. The program is limited to drug stores or pharmacies (MCC 5912, 5122) that have stores whose gross sales are at least 90% from prescriptions and over the counter (OTC) eligible healthcare products. If you are interested in participating in the 90% Program, you will need to work with the SIGIS Organization directly for the registration process.

Direct merchants to get more information at https://www.sig-is.org or have them contact merchants directly.

• SIGIS Memberships: https://www.sig-is.org/membership/member-services/description-of-membership-tiers-and-fees

• SIGIS Helpdesk Phone number: 925-855-3228

• SIGIS Helpdesk Email address: help@sig-is.org

Inventory Information Approval System (IIAS)

The IIAS is an inventory system that sorts a customer’s basket at the POS into items eligible for HSA/FSA and items that are not. At any non-medical retailer (or one without an eligible MCC defined by the cardholder’s plan), IIAS compliance is required to accept HSA/FSA. IIAS applies to all mass, discount, grocery, chain drug, mail order and some pharmacy merchants. The IRS adopted this requirement in 2006.

HSA/FSA cards are prepaid debit cards (Visa and MasterCard) that can be accepted as Signature Debit or PIN Debit. The cards have no extra level of data associated with them, but they are associated as HSA/FSA to the networks.

HSA/ FSA Card Declines

90% Exception Registered Merchant Declines

If a merchant is registered under 90% exception, and cards are still declining the issue may be one of the following:

• Just because the merchant has registered as 90%, this does not mean all Third Party Administrators (TPA) will honor the transaction. 

• There could be an information error on the merchants on-line form. The most common errors are:

  • Missing Values - The MCC, BIN, ICA and CAID fields must have a non zero value. E.g. 0 or 0000 is not a valid value.

  • MCC Values - If you have registered with a value other than 5122 or 5912 then update the 90% Rule Self-Registration form with the correct code

  • BIN and ICA Values - While it is possible to have the same value for the Acquirer BIN and Acquirer ICA, it is highly unlikely.

  • CAID Values (Card Acceptor ID) - A CAID value is unique for each store location - It is the 12 digit MID and the first three of the store. Field 42 of the ISO 8583. 

  • Authorization ICA and Authorization BIN - The authorization ICA or BIN is up to a 6 digit number but you have been provided a 4 digit number.  The ICA / BIN must be entered with leading zeros. Please do not add the zero’s at the end.

    • Example: 1234

    • Entered Correctly: 001234

    • Entered Incorrectly: 123400

IIAS Declines

Decline Reasons

Merchant Profile Issues

• (TSYS Specific) Merchant is boarded incorrectly in Express.

  • For SIGIS the TSYS profile requires the MCFS number to match the MID on the SIGIS website that the merchant has entered.

  • For IIAS the TSYS profile required the VISA MVV and the MasterCard MAID.

• The SIGIS merchant has not used the correct Merchant ID when registering on the SIGIS website.

  • Refer to bulletins 13EXP08; 06MMS08 which show placement for MasterCard (MC ID) and Visa (MVV) IIAS values.

Customer Card Issues 

• The card has not been activated or has been suspended

• The card has no funds remaining, or the card has insufficient funds and the merchant does not support partial authorization

• The cardholder is attempting to purchase only non-healthcare eligible items with a card that has only an FSA and/or HRA purse

•  The participant’s plan only reimburses the prescription drug amount and

  • The merchant does not send the Rx amount in the auth message, or

  •  The plan requires a match to claim(s) from a pharmacy benefit manager (the cardholder’s prescription drug plan) and the transaction failed to match, or

  • The merchant sends the Rx amount but does not support partial auth and there are non-Rx items being purchased

• The participant’s card has not been loaded with funds for the new plan year because of delays by the employer or TPA in getting the enrollment file to the issuer processor

• The merchant sent an expiration date that does not match the date in the issuer processor’s system – this can happen when there is an error key entering the expiration date

• The merchant manually keys in a card number that does not match a valid card on file with the issuer

• The cardholder was issued a new card, either because his/her employer changed TPAs or she/he changed employers, but is continuing to use the old card that has been closed.