Flexible Spending Accounts
Participating in a flexible spending account (FSA) is a great way to save money in 2014. Eligible full-time faculty or staff have the choice to enroll in a Health Care FSA and/or a Dependent Care FSA. You must enroll in an FSA during Annual Enrollment if you wish to have one in 2014.
With an FSA, you elect pre-tax contributions each pay period to your account(s). Use the Medical Plan Cost Estimator (MPCE) to estimate how much you should contribute from each paycheck for the Health Care FSA. You can use the money in your account to pay for eligible health care expenses throughout the year.
Some examples of eligible Health Care FSA expenses include:
- Prescription drugs
- Over-the-counter drugs, if prescribed by a doctor
- Eyeglasses/contact lenses
- Coinsurance not covered by your health plan
- Dental and vision expenses not otherwise covered by your plan
- Blood tests
- Lab fees
- Diabetic supplies
- Practitioner fees (i.e. allergist, chiropractor, etc.)
- Medical supplies (i.e. crutches, ambulance services, thermometers, etc.)
Some examples of ineligible Health Care FSA expenses include:
- Over-the-counter drugs not prescribed by a doctor
- Teeth whitening supplies
- Items paid or payable by insurance
- Premiums for group health coverage
You can use your Dependent Care FSA for expenses that enable you or your spouse (if you are married) to work or attend school full time. This includes:
- Child care
- Elder care
You cannot use your Health Care FSA funds for eligible Dependent Care FSA expenses, and vice versa. For a more complete list of eligible expenses for both FSAs, go to the WageWorks website http://www.wageworks.com.
There are limits to how much you can contribute to an FSA.
- Health Care FSA annual contribution limit: $2,500
- Dependent Care FSA annual contribution limit: $5,000 per family.
Keep in mind that IRS regulations require that expenses incurred during a calendar year must be reimbursed by April 30 of the following year. Any unused funds will be forfeited.