Flexible Spending Accounts

Flexible Spending Accounts (FSA)

A Flexible Spending Account or “FSA” is an opportunity to set aside pre-tax dollars, which can be used to pay for out-of-pocket medical & prescription, dental, and vision expenses.

FSA is now offered through OptumFinancial.

Is FSA right for you?

With the cost of healthcare rising, patients are responsible for more out-of-pocket medical expenses than ever before. FSA plans enable you to save money on these costs by setting aside pre-tax dollars to pay for eligible out-of-pocket expenses.

On average, you can expect to save 20-40% for every dollar you contribute to your FSA – that’s $20-$40 saved for every $100 in contributions!

How Does it Work?

If it’s your first time opening an FSA, you’ll receive a debit card associated with the account, which can be used to pay for eligible health and well-being expenses. The funds will be automatically debited from your FSA at checkout.

This card is accepted by most major healthcare service providers, including hospitals, private medical practices, dental care centers, vision care centers, and retail pharmacies. If the card does not work for any reason, you can still submit a manual claim through the member portal or the mobile app.

Be sure to keep your receipts and all proof of purchase documentation.

PrestigePEO offers two FSA options from OptumFinancial

Health Care FSA

A Health Care FSA allows you to set aside pre-tax dollars for non-reimbursable healthcare expenses, up to $2,750. This plan includes a $550 rollover provision, enabling you to rollover up to $550 into funds for the following benefits plan year. Rollover funds will be forfeited at the end of 2021 if you do not re-enroll. You must re-enroll for 2022.

Click here for more information and a list of eligible expenses.

Dependent Care FSA

A Dependent Care FSA permits you to set aside pre-tax dollars for childcare expenses up to $5,000. The dependent age limit is 13, and parents must work outside the home. Childcare providers and/or facilities must be licensed in order to qualify for reimbursement. As funds are deposited into your account via payroll deduction, expenses incurred can then be reimbursed via your Dependent Care FSA.

Due to COVID, the IRS permitted participants to rollover dependent care funds and allow a limit of $10,500 for 2020 into 2021.  As of this moment, unless otherwise notified by the IRS, pre-COVID levels are back in effect.

Click here for more information and a list of eligible expenses.

Rules to Remember

  • To continue participating in an existing FSA, you must re-enroll each year and adjust your contribution amounts if necessary.
  • If you are enrolled in a High Deductible Health Plan (HDHP), and you or your employer contribute to a Health Savings Account (HSA), your FSA funds will be limited to out-of-pocket costs associated with dental or vision care. All eligible medical and drug expenses must be reimbursed through your HSA.
  • Be sure to keep track of your expenses and spending. With a rollover limit of $550, any funds left over beyond that amount will be forfeited at the end of the benefit plan year.
  • They cannot be refunded per IRS regulations.
  • If your spouse contributes to a Dependent Care FSA through their employer, the combined maximum you may both contribute cannot exceed $5,000 per calendar year.

How to Enroll or Re-Elect

All plan elections and re-enrollments for 2022 will be made during open enrollment through the benefits portal.

Timeframe

Early – Mid-October 2021 Open Enrollment begins for client employees. All FSA and HSA elections will also be completed during the open enrollment process within the benefits portal.

All FSA and HSA changes are effective January 1, 2022.