Employee Benefits in the Age of COVID-19 – Part Three: Flexible Spending Accounts

This is the third in a weekly series to help Exchange associates understand how their benefits can help them navigate the uncertainty of the COVID-19 pandemic. This week’s story explores Flexible Spending Accounts.

As Americans’ health care needs continue to evolve amidst the COVID-19 pandemic, the Internal Revenue Service (IRS) is making guidelines for health care Flexible Spending Accounts (FSAs) a little more flexible.

Per IRS Notice 2020-29 and 2020-33 for calendar year 2020, employers—including the Exchange—may permit employees to make mid-year FSA elections and adjustments. From July 13-24 of this year, Exchange associates may:

• Enroll in a health care FSA
• Increase their FSA election
• Decrease their FSA election
  • Note: Although you cannot cancel your FSA, you will be able to decrease the amount. In these cases, employees may only decrease this amount to their current YTD contributions or the amount of claims that have already been paid (whichever is greater).
• Decrease dependent care FSA election to their current YTD contributions

Additionally, the FSA rollover amount for 2020 has increased from $500 to $550, allowing associates to carry over more contributions into 2021.

An FSA is a special, tax-exempt savings account that can be used to pay for certain out-of-pocket health care costs, including copayments, deductibles, some prescription and non-prescription drugs, and more.

In other benefits news, the Exchange’s eBenefits site is undergoing a major upgrade, including new, user-friendly features and more self-service options. Starting in mid-July, associates will be able to sign up to receive text messages, download forms and documents, and review their Summary of Benefits and plan descriptions. Stay tuned for more.