Faculty and staff enrolled in the Custom Network Plan or the PPO Plan, as well as faculty and staff who are benefit-eligible but not enrolled in any university medical insurance, can enroll in a Health Care Flexible Spending Account (FSA). Retirees are not eligible for an FSA. An FSA allows money to be deducted from your paycheck on a pre-tax basis to pay for qualifying health care expenses. (Note: Any benefit-eligible faculty or staff member, regardless of the medical plan they are enrolled in, may also use a Dependent Care FSA for child/day care expenses, but this is a separate election.) By reducing your taxable income, a Health Care FSA can save you a substantial amount on a wide range of IRS-qualified medical, dental, and vision expenses that are not covered by your insurance. Contributions to your FSA accounts are exempt from federal and, in some cases, state income taxes.
It is important to carefully budget your contributions and expenses. The University FSA Health Care Account has a 2.5-month Grace Period (through March 15 of the following year), which allows you extra time to incur expenses to use your flexible spending health care balance after the close of the plan year. The FSA Dependent Care account does not have the extended period of coverage so those expenses must be incurred during the plan year (i.e., by December 31). If you do not use all your contributions within the plan year (including the Grace Period for FSA health care), you forfeit any money left in your account.