Flexible Spending Account

For 2021, you can contribute $2,750 to a healthcare FSA or limited purpose FSA. Participants can contribute up to $5,000 for a dependent care FSA. Limits are set annually by the IRS. Your employer may determine a different maximum amount (up to the IRS maximum) depending on your plan.

The IRS determines which expenses are considered “eligible expenses,” and healthcare FSA funds may be used on any of these expenses. Some of the most popular expenses would be doctor co-pays, lab fees, over the counter medications, some medical equipment, prescription drugs and eyewear and doctor or hospital fees. For a full listing, visit our eligible expenses page.

There are a few ways to spend your funds. The easiest method is to use the MyChoice Accounts debit card that was mailed to you a few weeks before your plan began. Activate it according to the directions on the mailer and use it to purchase eligible items or pay for eligible services. You may also pay for eligible items with your own money and submit a claim for reimbursement online or via the MyChoice Mobile App. Finally, you may pay a provider, such as a doctor or lab directly with your account online or via the mobile app, and we will submit the payment to that provider on your behalf.

We recommend that you try to exhaust your FSA before the end of your plan year. We’ll send you reminders so you don’t forget. Depending on your employer’s plan rules, you may have extra time to spend it down or submit claims or you may be able to roll over a portion of your funds to the following year for use. Otherwise, unused FSA funds are returned to your employer and no longer available for your use.

Good news! You have two and a half months of your NEXT PLAN YEAR to exhaust your FSA funds. Be sure to spend funds on eligible expenses and document as needed. Any funds from “last year’s” plan not spent by the end of your grace period will be forfeited. (March 15 for a 1/1 plan start date)

Good news! Your employer has determined that you can take a portion of this year’s unused FSA funds (typically up to $550) and roll them into your next year’s account. You will forfeit anything above the threshold, so be sure to spend down to your rollover amount before the last day of your plan year.

Yes. You may cover eligible expenses incurred by any member of your family, including your spouse and any dependents. Any single expense must be covered by only one account type at a time, so any expenses reimbursed by a spouse’s HSA could not ALSO be reimbursed by your FSA. 

The best way to stay up to date on your FSA is to log in to your benefits portal online or access your account via the MyChoice Mobile App. You may also call your member services number listed on the back of your debit card for an automated balance or in-person balance request.

Typically, the IRS only allows a participant to change their contribution amount during your company’s annual enrollment period. There are a few exceptions. 
If you have a “life event,” or if the IRS makes a separate determination (such as due to the COVID-19 pandemic in 2020), you may change your contribution within 30 days of the life event. Examples of qualifying life events include: 

• Change in legal marital status, domestic partnership or civil union status 
• Change in the number of eligible dependents of the employee or dependents of the domestic partner or civil union partner 
• Add dependent—birth, adoption, placement for adoption, etc. 
• Loss of dependent—dies or reaches age 26 unless disabled as defined under the eligibility section 
• Change in employee’s, spouse’s, domestic partner’s, civil union partner’s or dependent’s employment status  
• Gain/lose entitlement to Medicare or Medicaid (60 days) 
• A change in residence of the employee, spouse, domestic partner, civil union partner or eligible dependent, which affects eligibility for coverage 
• Judgment, decree, or Qualified Medical Child Support order for health coverage of an eligible child 
• Significant change in health coverage of an eligible child 
• Significant change in coverage or cost of dependent’s plan 
   

Typically, dependent care FSAs cover expenses for providing care for a child under the age of 13, a dependent adult (i.e. disabled spouse or child, dependent parent). Expenses are for care provided in order for the employee to attend or seek work. 

• Licensed day care providers 
• Qualifying care for dependent adults 
• Pre-school or nursery school 
• Day camp (summer or holiday)  
• Late-stay fees 
• Private sitter 
• Before school or after school care

There are expenses that cannot be claimed for dependent care FSAs.  

• School tuition for K – 12 students 
• Child care, nanny, sitter expenses for non-disabled children 13 and up 
• Expenses for food, entertainment, devices, field trips 
• Registration fees or equipment for lessons or groups/teams 
• Overnight camps 
• Transportation expenses 
• Medical expenses for dependents 
• Child care expenses for care not provided during a caretaker’s working hours (i.e. date night, vacation, etc.) 

Limited purpose FSAs are usually paired with an HSA, to help you preserve your HSA balance. Use your funds on eligible dental and vision expenses, such as contact lenses, glasses, optomologist/optometrist visits, annual exams, non-cosmetic dental procedures and orthodontia. For a full listing, visit the limited purpose eligible expense list.

Most of the time, yes. The IRS requires participants to prove the each expense was is eligible. MyChoice Accounts will help you by requesting documentation when we can’t determine how the funds were used. Usually, an explanation of benefits or a detailed receipt will work. If you use your debit card, we are often able to verify that your expense was eligible based on your location or the items you purchased. This means you won’t need separate documentation. Always keep your receipts until you are sure the claim has cleared.

MyChoice Accounts will send you several reminders over the period of several months. Your employer has determined the amount of time you have to supply documentation. At any time during this period, you may offer a substitute documentation (i.e. documentation for a different eligible expense you paid out of pocket) or repay the amount back to your FSA. At the end of your appointed period, we may suspend your debit card until the matter is resolved. If the claim is not settled by the end of the plan year, the amount of the claim will be added back to your taxable income.

If you use your MyChoice Accounts debit card, you will only need to provide documentation about 10% of the time. Your card is coded to work on eligible expenses at thousands of retailers, drug stores, pharmacies, doctor’s offices and many more locations. When you use it at approved merchants or at approved healthcare provider locations, we can determine that your expense was eligible and automatically approve it. Sometimes, we’ll need to ask for follow-up to ensure that the service you received at a healthcare provider is eligible. For instance, the FSA will cover your semi-annual teeth cleaning expenses at your dentist office but will not cover a teeth-whitening visit.