Health Care Flexible Spending Account
Eligible Health Care Expenses
A health care flexible spending account (FSA) is a pre-tax benefit account used to pay for eligible medical, dental, and vision care expenses that are not covered by your insurance plan or elsewhere. Despite the general rule stated above:
- An eligible expense does not include expenses for qualified long term care coverage or premiums paid for group or individual health plan coverage.
- Over-the-counter medications without a doctor's prescription are not be reimbursable. Over-the-counter medication may be reimbursed by submitting a doctor's prescription along with a receipt to SelectAccount.
The IRS determines which expenses are eligible for reimbursement.
Using Your Account
The Online Member Service Center with SelectAccount allows you to access your account balance, submit claims, and review helpful resources on your HRA/VEBA and FSA accounts. To register:
- Visit selectaccount.com.
- Select Members and "Sign In/Register" at the top of the screen. This will take you to the Online Member Service Center sign-in page. From here, select "Register."
- Enter the requested information and your SelectAccount ID number. You can find your SelectAccount ID number on your account verification form or by calling customer service at 1-800-859-2144.
Health Care FSA Carryover
Any unspent funds greater than $25 but less than or equal to $500 that remain in your health care FSA at the end of the 2016 will be carried over to the 2017 plan year. This carryover feature does not apply to the dependent care FSA.
Carryover Frequently Asked Questions
Do carryover funds affect the health care FSA contribution maximums? No. Carryover funds are in addition to the annual limit on the health care FSA contributions ($2,600 for 2017).
When will the remaining prior plan year funds carryover into the new plan year? Carryover funds will be available on the first day of the new plan year. However, the amount of the carryover will not be determined until the end of the run-out period for the previous plan year.
During the run-out period, which account will be used first – the 2017 account or the carryover amount from the 2016 account? The 2017 (current) account will pay first and the 2016 (carryover) account will pay second. After the run-out period, any amount between $25 and $500 remaining in the 2016 will be added to the 2017 account balance.
Does an employee need to elect an FSA for the following plan year to have the FSA funds carryover? No.
Why aren’t amounts less than $25 eligible for carryover? The administrative fees and managerial tasks associated with accounts less than $25 would exceed the value provided to an employee for that account.
Is the carryover option available for the dependent care FSA? No, the carryover option is for the health care FSA only.
Health Care FSA Carryover Example
- For 2016, John elects to contribute $1,000 to his health care FSA. As of 12/31/2016, his 2016 plan year balance is $400.
- For 2017, John also elects to contribute $1,000 to his health care FSA.
- On 3/31/2017, John submits a claim with a date of service of 2/1/17 for $200. This claim will be paid out of the 2017 health care FSA funds and will leave a balance of $800 in the 2017 health care FSA.
- On 4/15/17 (the end of the run-out period for 2016 FSA claims), $400 will carryover from the 2016 health care FSA and will be added to his 2017 balance of $800 for a total of $1,200.
Last updated Jan 6, 2017