FSA News and Updates
This page is to provide updated news and guidance related to Covid-19 and FSA plans as it becomes available from the IRS
The information below is based on early interpretations of the guidance issued recently and may be subject to change. We will continue to update this site as more information becomes available.
(Update as of 12/30/2020): The COVID-19/Consolidated Appropriations Act bill (signed into law on December 27th, 2020) allows temporary plan revisions for flexible spending accounts. The changes are:
- Allow Health and Dependent Care Flexible Spending Accounts (FSAs) to carryover unused benefits up to the full annual elected amount from 2019-20 year to 2020-21 plan year (previously limited to $500 maximum for Healthcare and $0 for Dependent Care).
- Temporarily extending the maximum age of eligible dependents from “under 13” to “under 14” for Dependent Care FSAs.
- Allowing plans to permit a prospective change in election amounts for Health and Dependent Care FSAs for plan years ending in 2021 (previously set to expire December 31, 2020).
The City’s Benefits Office is working to understand the details and confirm new plan effective dates. HealthEquity (formerly WageWorks) will not have these provisions updated in their system prior to January 1st, but they are acting quickly on behalf of the City. More details will be communicated in the coming weeks, but we wanted to ensure some information was shared before December 31st.
Questions can be directed to the Benefits Office via email at email@example.com.
As of May 12, 2020, the Internal Revenue Service (IRS) issued new Flexible Spending Account (FSA) guidance for those affected by COVID-19. In response, the City has made the following changes to our current plan year Healthcare and Dependent Care Flexible Spending Accounts:
- If you’re actively enrolled in the Healthcare and/or Dependent Care FSA plans, your claim period is extended until December 31, 2020 (previously June 30, 2020). This means you’ll have more time to seek services and have them reimbursed.
- You still have the extra three months to submit for reimbursement (new deadline is March 31, 2021) for eligible expenses incurred between the start date of your plan (typically July 1, 2019) and December 31, 2020.
- Forfeiture still applies for all 2019-20 plan year Dependent Care FSA balances after December 31, 2020.
- Forfeiture of 2019-20 plan year Healthcare FSA balances below $50 and above $500 apply after December 31, 2020. Any remaining 2019-20 funds between $50 and $500 will rollover into your 2020-21 Healthcare FSA balance.
- The above will happen automatically, so there’s nothing you need to do.
- To review your FSA account balance, access your account at www.wageworks.com.
New FSA Enrollment or Increasing FSA contributions:
Prior to December 31, 2020 you may enroll or increase your HealthCare FSA or Dependent Care FSA election without a qualifying life event (you may increase as long as you have not spent more than you have contributed) 1st of the month following date of the request. Go to portlandoregon.gov/benefits to increase your election. View COVID-19 FSA Enrollment/Increase Instructions.
Currently, you cannot decrease or cancel your Healthcare without a qualifying life event (see FAQ section below). Contact the benefits office as soon as you identify your need in making an FSA election change; delaying may increase your risk of forfeiting unused funds. firstname.lastname@example.org
Please be aware that if you increase your FSA election, this will change your plan coverage periods which determine when you can spend your contributions (see below):
We do not anticipate any extensions for the 2020/21 plan year, so please elect accordingly.
Any available 2020-21 plan year Healthcare FSA balance above $50 and below $550 on June 30, 2021 will carry over to the 2021-22 plan year.
Dependent Care FSA Decreases or Cancellations
Due to schools and childcare centers being closed, employees now have until December 31, 2020 to decrease or cancel your 2020-21 Dependent Care FSA Election.
To decrease or cancel your Dependent Care FSA election email your request to the benefits office directly at email@example.com. In your email include the amount you would like to decrease your election to or if you would like to cancel your election.
The decrease or cancellation of your Dependent Care FSA election will be effective 1st paycheck of the month following the receive date of your email request.
Please contact the benefits office if you need additional assistance.
FAQs about how Covid-19 impacts your FSA Accounts
1. Can I buy virus preparedness products with my healthcare FSA funds?
Yes-there are many products for virus preparedness that can be purchased online at www.FSAstore.com, including thermometers, heat and cold pads, first aid kits, and more. These items are FSA eligible and do not require a prescription.
2. I heard that I can now buy over-the-counter products with my Healthcare FSA funds. Is this true?
Yes! Over-the-counter drugs, medicines and menstrual care products can now be paid for or reimbursed without a doctor’s prescription. These purchases are eligible beginning 12/31/2019:
Be sure to save your receipts so that you can submit these to Wageworks for reimbursement.
Your Flexcard may not work at common retailers and the receipt showing your purchase will need to be uploaded to your Wageworks portal in order to be reimbursed.
3. Can I make changes to my Healthcare FSA and/or my Dependent Care FSA annual goal amount due to Covid-19?
Prior to December 31, 2020 you may enroll or increase your HealthCare FSA or Dependent Care FSA election without a qualifying life event (you may increase as long as you have not spent more than you have contributed) 1st of the month following date of the request. See New FSA Enrollment or Increasing FSA contributions (above). View COVID-19 FSA Enrollment/Increase Instructions.
4. What if I have experienced a qualifying event, such as a gain or loss of healthcare coverage and/or the addition or dropping of a dependent on the plan?
You might be able to change your annual election. Report your change online at www.portlandoregon.gov/benefits within 60 days of the event date. Proof of the eligible change is required. Having more or fewer medical expenses does not qualify as an IRS approved change.
5. I have a Dependent Care FSA and have experienced a change in my dependent care needs (daycare closure, employment change, summer camp cancellation, etc). What can I do?
You might be eligible to change your annual election. Report your change online at www.portlandoregon.gov/benefits within 60 days of the event date. The effective date is the first of the month after the enrollment change date.
Do you have additional questions? Please email us at firstname.lastname@example.org.