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News Release

Friday, October 31, 2003
Contact: Michael Orenstein
Tel: 202-606-2402

FSA Open Season for Federal Employees to Begin November 10

Nearly all agencies will pay FSA administrative fees for employees

Washington, D.C. -- Federal employees soon will be able to sign-up for coverage under the OPM-sponsored flexible spending account program, which reimburses employees for many non-covered medical expenses, as well as child- and dependent-care costs.

The Flexible Spending Account (FSA) open season begins Monday, November 10. The enrollment period begins with an extensive education campaign to inform and educate employees about the money-saving features of the program.

The FSA enrollment period coincides with the annual Federal Employees Health Benefits open season. The enrollment periods for the FEHB and FSA programs run through December 8.

"Flexible spending accounts are effective financial management tools that can stretch the disposable incomes of account holders and ensure that funds are available, when needed, to pay for out-of-pocket medical expenses or dependent-care costs of a child or parent," said OPM Director Kay Coles James. "I am particularly pleased at the number of agencies that identified payment of fees to facilitate greater participation in the program as an important part of effective human capital management."

During an FSA early-enrollment period in July, OPM announced that more than 111 agencies had decided to follow the practice of most private employers and pay a small administrative fee that is charged to employees who maintain a health-care FSA, dependent-care FSA, or both. The maximum fee for federal employees on a health-care FSA is $48 each year; the fee for a dependent-care FSA is equal to 1.5 percent of the annual account contribution declared by the employee at the beginning of each calendar year.

All cabinet agencies, including the Departments of Defense and Agriculture, and most sub-cabinet and independent agencies, such as the General Accounting Office, have stepped forward to cover their employees' administrative fees in the FSA program next year. Only a handful of agencies have notified OPM that payment of administrative fees will be the responsibility of employees.


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