Member FSA engagement more critical now more than ever
Increased Carryover Adoption Presents New Educational Challenges
There’s no question that the 2013 change to the Flexible Spending Account’s (FSA) “Use-it-or-Lose-it” rule was more than welcomed. The option for an FSA to include a Carryover of up to $500 presents consumers with more flexibility and employers with more choice in designing their FSA.
To recap current FSA deadline options, an FSA may have the following:
A Grace Period – Two and half months after the
end of the FSA plan year to incur new expenses and pay using prior year funds.
A Carryover – Up to $500 will carry over from the end of the current FSA plan year to the next. Any amount remaining over $500 is forfeited.
No Extension – Funds not used by FSA plan year end are forfeited.
A Run-Out Period – Up to 3 months after the end of the FSA plan year to submit for reimbursement of expenses incurred during the prior plan year.
Employers may offer a Carryover or Grace Period but not both, can offer a run-out with either of these options, and are not required to provide any extension at all.
Confused yet? If you’re new to FSAs, be advised that the benefit of an FSA far outweighs the educational hurdle. An FSA provides you with up front pre-tax funds to cover your out of pocket medical costs, a relief to those who may not have the spare $50 here and there for co-pays, $1,000 or
more to pay their health insurance deductible or hundreds of dollars for their
every-day health care needs.
If you’ve had an FSA for a while, be aware that some of the rules have changed, so it’s more important than ever to understand your benefit deadlines. Being aware of your FSA deadlines can help you manage your funds year-round.
To make the most of your FSA and get information to help you become a more engaged consumer, FSAstore.com provides you with a one-stop shop for all eligible FSA items, as well as tools to help you maximize your benefit. Visit FSAstore.com today!