FSA Grace Period Policy Changing

OPM is revising the flexible spending account program’s “use or lose” feature effective with the 2015 plan year. Under the traditional policy, in either health care or dependent care accounts, eligible expenses could be charged against a plan year if they were incurred during the 2 1/2 months following the year. That “grace period” policy will apply only to dependent care accounts starting next year (it will remain in effect for 2014 plan year health care account money unspent by the end of this year). Instead, health care account enrollees will be able to carry up to $500 from one plan year to the next (so long as they have an FSA account in the succeeding year; if not they lose any money that was unspent in the plan year). Also, the minimum for either type of account is falling from $250 to $100.