Cost Plus Information Package
P.O. Box 1569, 10115 110 Street, Fairview, AB
T0H 1L0
Phone: 1-866-408-4999 Fax: 780-835-5312
Email: [email protected]
Updated: 05/27/2015
COST PLUS BENEFIT PLAN
INFORMATION PACKAGE
Cost Plus is a Private Health Services Plan (PHSP) that provides 100% health and
dental and vision coverage.
This plan can be a “stand alone” plan or can be used to supplement existing health and
dental plans.
Cost Plus is a “pay as you go” plan. Premiums are not charged monthly but on a “per
claim” basis.
Cost Plus covers all health-related expenses eligible as defined under Subsection
118.2(2) of the Income Tax Act (or IT 519R2). www.cra-arc.gc.ca
The employer sets the level of coverage for the employees. This can be based on
position with the company, length of employment, etc. This limit can be changed yearly.
There is no statutory limit for the amount of medical/dental expenses that can be
reimbursed but must be reasonable in order to be deductible.
You pay for your health and dental expenses as you normally would. This plan only
accepts paid receipts.
Your business then pays Canwest Group Benefits Inc (plan administrator) payment to
cover the health and dental expense plus a 10% administration fee (both of which are
tax deductible). Canwest Group Benefits Inc then provides the claimant with a tax free
reimbursement of the health and dental expenses incurred.
Employees manage this plan themselves – they decide which health and dental benefits
they want to claim through the plan up to their annual maximum. Once they have used
up their annual maximum, claims cannot be carried over to the following year.
There is no enrollment fee or monthly premiums to pay.
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LIST OF ELIGIBLE EXPENSES
WHAT IS COVERED
The list of Eligible Expenses is not comprehensive and is subject to change at any time without
notice. This information does not supersede information or decisions rendered by Canada
Customs and Revenue Agency (Canada Revenue Agency).
Please visit Canada Revenue Agency’s website, http://www.cra-arc.gc.ca/ or the direct link,
http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/rtrn/cmpltng/ddctns/lns300-350/330/llwbl-eng.html
for the active list of eligible expenses.
Under the Cost Plus plan, participants can be reimbursed for medical related expenses not
covered by provincial health care or an employee's health and dental plan. Any medical
related expense which could be used to meet requirements for deductibility on a participant's
personal income tax return (in accordance with the Income Tax Act) is eligible for
reimbursement. The expenses must qualify for reimbursement for an “eligible medical
expense” as defined under subsection 118.2(2) of the Income Tax Act (or IT 519R2), which
includes many items not covered by most traditional medical and dental insurance plans.
Note: Premiums for Alberta Health Care (AHC) or any other Provincial Health Care Plan are
not eligible expenses.
PREMIUMS FOR HEALTH CARE PLANS
Premiums paid to any non-governmental medical, dental or hospital care plans.
Example: Alberta Blue Cross, Great West Life, Canada Life, etc
PROFESSIONAL SERVICES
Any service performed by a licensed qualified medical practitioner, including, but not limited to
the following:
Acupuncturist
Chiropodist
Chiropractor
Dentist
Dental Hygienist
Dietician
Gynecologist
Naturopath
Neurologist
Opthamologist
Optometrist
Orthodontist
Osteopath
Physician
Physiotherapist
Podiatrist
Psychiatrist
Psychologist
Registered Nurse (RN)
Speech Therapist
Surgeon
Note: A qualified medical practitioner means a person who is authorized to practice in
accordance to the laws of the province and is certified according to the practitioner's governing
body.
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DENTAL SERVICES
Any service performed by a qualified licensed practitioner, including but not limited to the
following:
Dental X-Rays
Denture Repairs
Denture Replacement
Dental Examinations
Extracting Teeth
Filling Teeth
Gum Treatment
Oral Surgery
Orthodontic Treatment
Crowns & Bridgework
Dental Implants
Dentures
LABORATORY EXAMINATIONS, TESTS AND HOSPITAL SERVICES
Any service performed by a licensed medical practitioner, including but not limited to the
following:
Blood Tests
Cardiographs
Diagnostic Fees
Metabolism Tests
Prescription Drugs
Spinal Fluid Tests
Use of Operating Room
Vaccines
X-Rays & Lab Fees
MEDICINES & MEDICAL TREATMENTS
Must be prescribed by a licensed medical practitioner and dispensed by a licensed
pharmacist or licensed medical practitioner as part of their medical services:
All Prescription Drugs
Insulin & Insulin Supplies
Oxygen & Equipment
Blood Transfusion
Radiation Therapy
Audiology Tests & Treatment Vein Removal
Organ Transplants
Nursing Services by RN
PRESCRIBED MEDICAL MATERIALS & APPARATUS
Must be prescribed by a licensed medical practitioner and dispensed by a licensed
pharmacist or licensed medical practitioner as part of their medical services:
Breast prosthesis
Birth Control Pills
Orthopedic Shoes & Boots
Extremity Pumps
Hospital Beds at Home
Infusion Pumps
Devices to Mobility Impairment
Oxygen
Synthetic Speech Systems & Braille Printers
Wigs required as a result of medical treatment
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MEDICAL MATERIALS & APPARATUS NOT REQUIRING PRESCRIPTION
Any materials or apparatus paid to a doctor, nurse or hospital
Any materials or apparatus paid to a doctor, nurse or hospital
Artificial Limbs
Braces
Blood Sugar Measuring Devices
Catheters
Crutches
Colostomy / Illestomy Pads
Hearing Aids, Audible Telephone Systems
Wheelchairs
VISION COVERAGE
Must be prescribed by a licensed medical practitioner and dispensed by a licensed
pharmacist or licensed medical practitioner as part of their medical services:
Eye Glasses
Frames & Fittings
Contact Lenses
Eye Exams
Laser Eye Surgery
OTHER EXPENSES
Must be prescribed by a licensed medical practitioner and dispensed by a licensed
pharmacist or licensed medical practitioner as part of their medical services:
Ambulance Charges
Home Maker Services & Home Care (No Relatives )
Prescription Birth Control Pills
Specially Trained Dogs for Blind / Deaf / Impaired
Co-Insurance and Deductibles for medical expenses not paid or reimbursed by Employee
Benefit Plans
MEDICAL TRAVEL EXPENSES
If you had to travel at least 40 kilometres (one way) from your home to obtain medical
services, you may be able to claim the transportation expenses you paid as medical expenses.
If you had to travel at least 80 kilometres (one way) from your home to obtain medical
services, you may be able to claim accommodation, meal, and parking expenses in addition to
your transportation expenses as medical expenses.
To claim transportation and travel expenses, the following conditions must be met:
- substantially equivalent medical services were not available near your home;
- you took a reasonably direct travelling route; and
- it is reasonable, under the circumstances, for you to have travelled to that place for
those medical services.
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WHAT IS NOT COVERED
Air Conditioner, Humidifiers, Dehumidifiers, Air Cleaners
Antiseptic Diaper Services
Cost of Missed Appointment
EXPENSES INCURREDFOR PURELY COSMETIC PROCEDURES (including related services and
other expenses such as travel). This generally includes surgical and non-surgical procedures
purely focused on enhancing one’s appearance such as liposuction, hair replacement
procedures, Botox injections, and teeth whitening
Health / Fitness Programs offered by Resort Hotels or Health / Fitness Clubs Homeopathic
Medicaments and Herbal Supplements
Illegal Operations, treatment or drugs
Maternity Clothes
Medical Expenses reimbursed from other benefit plans
Non prescription birth control devices
Non prescription sunglasses / clip-ons
Personal Fitness Trainers / Gym Memberships
Reiki practitioner
Rolf Therapy
Scales for weighing food
Special Foods unless for treatment of medical condition and prescribed by a medical
practitioner
Take home bleaching kits (dental)
Toothpaste
Umbilical Cord Blood Extraction and Storage
PROVINCIAL HEALTH CARE PREMIUMS ARE NOT ELIGIBLE
SPECIAL NOTE: This is not a complete list of all eligible expenses, it is intended to
provide a guideline and examples of commonly claimed medical expenses. Please visit
CRA's website for the complete list of which expenses are and are not eligible to be
claimed.
The final authority for Income Tax purposes is Canada Customs & Revenue Agency (CCRA).
Please refer to Section 118.2(2) of the Income Tax Act for a complete list of expense
coverage or go to:
http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/rtrn/cmpltng/ddctns/lns300-350/330/llwbl-eng.html
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WHO IS ELIGIBLE?
Shareholders are eligible if they are actively employed by the company and the
benefit is paid in their capacity as an employee, not a shareholder. In order for the
benefits to qualify

the shareholder must be actively engaged in the business activities of the
corporation, although not necessarily collecting a salary.

the benefits must be reasonable, and be consistent with what would be
offered to an arm’s length employee providing similar services
Employees – for an individual to receive tax free health and dental benefits from an
employer, Revenue Canada must define them as an employee. If one of the following
answers to the questions below is “yes”, then the person is an employee.
1. Does the individual collect a wage, salary, fees or bonus?
2. Does the corporation (employer) remit payroll taxes (income tax and CPP) on
behalf of the individual?
3. Are payments made to the individual deductible from the corporation’s
(employer’s) income? (IE. management fees, wages, salaries, bonuses)
UNINCORPORATED BUSINESSES
If you are unincorporated (self-employed individual or partnership) you may qualify for
a Cost Plus plan, if

you are actively engaged in the business on a regular and continuous
basis, or

your total income from the year from other sources does not exceed
$10,000.00
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PLAN SETUP:
A Cost Plus plan can be designed in many different ways. When designing the plan,
different classes with set limits can be created according to:

Single vs family

Responsibility in the company (manager vs employee)

Length of service with the company
For example – an employee that is a Manager could have a higher limit than a full time
employee. Or an employee that has been with the company 5 years could have a
higher limit than employee that’s only been there one year. This would also work as an
incentive for the employees that once they reach the next level (ie five years) they could
look at an increase in their Cost Plus.
One thing to keep in mind is that employers MUST offer their employees some type of
benefit plan. Employers can’t set themselves up with a $20,000 Cost Plus plan and
offer nothing to the employees. At the same time, they need to set up their Classes with
“reasonable and customary” limits. For example, the employer shouldn’t have a
$50,000.00 limit and give their employees a $100.00 limit.
The limit set is an annual limit. There is no carry forward of unused amounts. “Use it or
lose it”. If a plan member sends in a claim from last year and hasn’t used up his/her
annual limit for that year, the claim will be honored.
For Cost Plus plans that have their employees enrolled, the employee would send in a
claim form along with receipts. Canwest adjudicates the claim to ensure eligibility.
Once the claim has been processed, the employer will receive an Invoice for the
amount owing. In order to protect the employee’s privacy, the employer does not see
the receipts or is given any information regarding the details of the claim.
All receipts submitted must be PAID by the individual in order to qualify for
reimbursement. This is a “reimbursement” plan only. This ensures the reimbursement
back to the employee is “tax free”.
Before implementing a Cost Plus program, we strongly encourage you to consult
with your professional tax advisor. You want to be sure that you are eligible to
implement a Cost Plus program; and before any expenses are submitted for
reimbursement, you need to be sure that these expenses are eligible. For a
complete list of eligible medical expenses (form IT-519) you can visit Revenue
Canada’s website at www.cra-arc.gc.ca or by calling 1-800-959-2221.
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