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Flexible Spending Accounts for 2019

FSAs give tax-free help for qualified medical expenses with no administration fee

A Flexible Spending Account (FSA) provides another opportunity for you to better control your health care dollars. By tucking away pre-tax dollars from your paycheck, you have an account that is dedicated to the reimbursement of qualified medical, vision and dental expenses. In addition, the bi-weekly employee administration fee is paid by the state during the 2019 plan year, providing you with even more opportunities to save.

There are three types of FSAs: Medical Care, Limited Purpose Medical Care and Dependent Care. All of the state’s FSA programs are administered through Key Benefits Administrators and have a use-it-or-lose-it rule. Money left at the end of the plan year is not rolled over or reimbursed, so plan carefully. You must re-enroll in medical and dependent care FSAs each year if you wish to continue to participate. If you continue participation, do not discard the debit card from Key Benefit Administrators. New cards are not automatically issued each year.

Medical Care & Limited Purpose FSA

Medical Care and Limited Purpose FSAs allow employees to use pre-tax dollars to cover health care costs for medical, dental, vision, hearing and other out-of-pocket expenses not paid by insurance. For 2019, the maximum annual contribution for the Medical Care and Limited Purpose FSAs is $2,500.

A Limited Purpose FSA may only be used for dental, vision and preventive care expenses until the minimum deductible of a Consumer Driven Health Plan (CDHP) is met ($1,350 for single and $2,700 for family, per federal regulations). Once the minimum deductible is met, the Limited Purpose FSA can be used as a Medical Care FSA. If you are enrolled in a CDHP with a Health Savings Account (HSA), your FSA automatically becomes a Limited Purpose FSA. You do not need to meet the minimum deductible to use the funds in your Limited Purpose FSA for dental and vision expenses. You can pay for dental and vision expenses from your Limited Purpose FSA at any point during the year.

Employee Enrollment Information Packets

Dependent Care FSA

A Dependent Care FSA is used to pay for dependent care services, such as preschool, summer day camp, before or after school programs and child or elder daycare. Dependent care expenses do not include medical expenses and therefore can be used even if you participate in an HSA.

Dependent Care FSAs are not frontloaded. Portions of your biweekly pay are put into a pre-tax account to pay for eligible dependent care costs throughout the year. Currently, the maximum annual contribution amount for the Dependent Care FSA is $5,000 ($2,500 if married and filing separate tax returns).

Employee Enrollment Information Packet