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Frequently Asked Questions Insurance

Flexible Spending Account

  • The grace period is an additional 2 ½ months (running January 1 through March 15) during which you can incur eligible expenses that can be reimbursed from your prior year’s balance.  The grace period helps participants avoid forfeiting any of the funds deposited in their FSA account.  Dependent care accounts have a grace period every year.  The last grace period for health care accounts is January 1, 2015 through March 15, 2015.  
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  • In Notice 2018-03 the Internal Revenue Service (IRS) released the medical mileage rate for the 2018 benefit period. The 2018 rate is 18 cents per mile, a slight increase from 2017.

    Mileage to and from a medical service is an eligible expense under a Health Care Flexible Spending Account (FSA). Simply use the Mileage Worksheet available at www.FSAFEDS.com to log miles to and from your doctor, dentist, pharmacy or other medical care provider. When you’re ready to submit a claim, sign the bottom of the Mileage Worksheet to certify the expense, and submit the worksheet along with your completed Health Care FSA claim form. For questions please call 1-877-FSAFEDS (372-3337), TTY Line: 1-866-353-8058. 
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  • By law, annuitants (other than reemployed annuitants) cannot participate in any flexible spending account (FSA) programs, including FSAFEDS. FSAs are a way of setting aside pre-tax salary for reimbursement of eligible expenses. Annuitants receive annuities, which are not salary.

    The balances in your Health Care FSA (HCFSA), LEX HCFSA and Dependent Care FSA (DCFSA)  are treated differently if you separate or retire before the end of the calendar year.

    Your HCFSA or LEX HCFSA will terminate as of the date of your separation or retirement. There are no extensions. Any eligible health care expenses incurred prior to the date of separation will still be reimbursed but those incurred after the separation date are not reimbursable, even if you accelerated your allotments.

    Your DCFSA remaining balance can continue to be used to pay for eligible dependent care expenses until your account balance is depleted or the end of the calendar year, whichever comes first.

    Please note, in order to take advantage of the grace period for your DCFSA, you must be actively employed and making allotments through December 31 of the Benefit Period.

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  • The IRS created the "use or lose" rule, which states that all money left in your FSA is forfeited after the benefit period ends. If you don't use all of your FSA funds during the benefit period, you risk losing money.

    However, the HCFSA and the LEX HCFSA have Carryover, which can allow you to carry over up to $500 in unused funds into the next benefit period. Any remaining unused funds over $500 will be forfeited. To be eligible for carryover you must both:

    • Actively employed by an FSAFEDS-participating agency and contributing to a HCFSA or LEX HCFSA through December 31, and
    • Reenroll in the FSAFEDS

    A DCFSA does not have Carryover, but this account has a grace period of 2 1/2 months (January 1 - March 15) during which you can incur eligible dependent care expenses and use funds remaining in your DCFSA from the previous benefit period. You have until midnight Eastern Time on April 30 following the end of the benefit period to file claims for eligible expenses incurred during the previous benefit period or grace period.

    When you contribute to an FSA, you agree to reduce your salary by a specified amount and your employing agency contributes that amount to an FSA for you. Since you never received that money, you cannot be taxed on it. If you were to receive the unused amount at the end of the benefit period, the IRS would consider this "deferred compensation". Section 125 of the IRS Code prohibits deferred compensation, thus the "use or lose" rule.

    Your Agency cannot provide waivers for any employee regarding funds that might be forfeited. Neither OPM, nor your employing agency, has the authority to make any exception to the "use or lose" rule. To reduce your risk of losing money at the end of the benefit period, carefully estimate your expenses when choosing your annual election amount before enrolling in an FSA.

    Please also keep in mind that reimbursement for expenses is generally based on when an expense is incurred, not when it is paid. You can use the "Savings Calculator" on www.FSAFEDS.com to help you calculate allotments based on your individual situation, as well as indicate your potential tax savings. 

    If you are a Qualified Reservist, you may be eligible to request a Qualified Reservist Distribution (QRD) in order to avoid forfeiting money in your FSA account. For more information, see the HEART Act Quick Reference Guide on www.FSAFED.com.

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  • If you are eligible for carry over it does not matter that you switched from a HCFSA to a LEX FSA during Open Season. Next year when the carry over money becomes available for use, those funds can be used for the type of eligible expenses available with the account you are currently enrolled.

    For example: If you had a HCFSA this year and elected a LEX FSA during Open Season for next year, on May 1st of next year you could use all available funds (carry over and newly elected) in your FSA towards any eligible LEX FSA expenses.  However, you could not use any available funds towards expenses that would solely be considered an HCFSA eligible expense.
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  • Yes.  Like general expense health care FSAs, limited expense health care FSAs have a grace period from January 1, 2015 through March 15, 2015. During this grace period, you can incur eligible expenses for your type of health care FSA and be reimbursed from your 2014 balance. This is the last grace period for health care FSAs.

    If you enroll in a general expense or limited expense health care FSA for 2015, you will not have a grace period.  Instead, you will be able to carry over up to $500 of unspent funds into another health care account in 2016.
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  • Kaiser Permanente FEHB members must include both a Check-In Receipt and an After-Visit Summary per each medical service or office visit that is submitted for reimbursement to FSAFEDS:

    • A Check-In Receipt is the copayment receipt provided after checking-in for your visit.
    • An After-Visit Summary is a summary of your visit details given to you at the end of your office visit appointment (and accessible through your kp.org My Health Manager account).
    • NOTE for FEHB members in Northern and Southern California only: In lieu of an After-Visit Summary, you should submit a Patient Courtesy Bill along with your Check-In Receipt. You may request a Patient Courtesy Bill from your local patient business offices. Please contact California Member Services at 1-800-464-4000 for assistance.
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  • If you elect “Shared Account” processing with your spouse when you enroll. If you and your spouse each participate in FSAFEDS and YOU are NOT the FEHB and/or FEDVIP enrollee, you can have your spouse’s eligible FSAFEDS PR claims processed against YOUR FSAFEDS account when the balance in your spouse's FSAFEDS account reaches zero. Remember, since all claims will be processed until your spouse’s account is depleted, your spouse may not have a carryover account created. This means once your spouse's account balance is depleted, all claims will be processed against your FSAFEDS account, through December 31 of the Benefit Period. Beginning January 1 of the following Benefit Period your claims will revert to being processed against your spouse’s account.
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  • Information about FSAFEDS and your account can be found at www.fsafeds.com.

    You may also contact our FSAFEDS Benefits Counselor at 1-877-FSAFEDS (372-3337), TTY: 1-866-353-8058, Monday through Friday, 9:00 AM until 9:00 PM Eastern Time.
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  • No, your FSAFEDS contributions are deducted in equal installments throughout the year, or you can accelerate your allotments during the beginning of the year if you choose.  You cannot begin contributing in the middle of the year unless you enroll in the middle of the year due to a Qualifying Life Event.  

    All of your health care FSA funds are available for reimbursement on January 1 of the benefit period.  Dependent care FSA funds, on the other hand, are only available up to the amount you have contributed to date. 

    For more information please visit: www.FSAFEDS.com  
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