Posted 1:44 p.m. Friday, May 28, 2021
Recent COVID relief legislation allows employers to modify their benefit plans to help provide relief and greater flexibility to participants.
As a result, on May 12, 2021, the Group Insurance Board approved the following changes to the Health Care Flexible Spending Account (FSA), Limited Purpose FSA, and Dependent Day Care Account Program (DCAP) as outlined below.
1. Rollover Amount Increases
Participants enrolled in a 2020 plan year Health Care FSA, Limited Purpose FSA, or Dependent Day Care Account will have their unused 2020 carryover limit funds rolled into their 2021 plan year account up to the approved amount listed below rolled. Specifically,
· Health Care and Limited Purpose FSA The 2020 plan year Health Care and Limited Purpose FSA carryover balances were increased to $1,000 from $550.
· Dependent Day Care FSA The 2020 plan year DCAP rollover balance was increased to $2,500 from $0. As a result, active participants who had a remaining 2020 balance up to the $2,500 maximum will receive access to their rollover funds by Monday, June 7, 2021. The updated DCAP carryover limit is only applicable for 2020 into the 2021 plan year. Participants with dependents age 13, please also see “3. Dependent Day Care, Age 13” below.
2. One-time Election Increase – Qualifying Event Not Required
DCAP participants enrolled in the 2021 plan year may make a one-time mid-year election increase to their current elections without experiencing a qualifying event.
· Individuals or married couples (who file a joint tax return) may increase their 2021 plan year annual election from a maximum of $5,000 to a maximum of $10,500.
· Married individuals who file their taxes separately may increase their 2021 plan year annual election from a maximum of $2,500 to a maximum of $5,250.
To make an increase, participants must complete and return the Election Change Request form to their Benefits Specialist beginning June 1, 2021, and no later than June 30, 2021.* Please note: this one-time mid-year election change is limited to increases only. Decreases to your annual election and/or enrollment requests will not be accepted.
*UW Hospital and Clinic Dependent Day Care Account Participants: To make an increase to your Dependent Daycare please contact the HR Service Center by submitting a service request via HR Help Desk or calling 608-263-6500 to complete this election in Oracle Cloud.
Forms submitted to your Benefits Specialist by June 1 will be effective June 1. Forms submitted June 1 through June 30 will be effective July 1. Forms submitted after June 30 will not be accepted.
3. Dependent Day Care, Age 13
- 2020 Fund Carryover Dependent Day Care Account participants may now claim eligible expenses for children age 13 or younger during the 2021 plan year using 2020 DCAP carryovers. This provision is only applicable for the 2021 plan year.
- One-time Mid-year Election Increase You will not be able to enroll in the 2021 DCAP one-time mid-year election increase if your dependent turns age 13 in 2021.
- 2021 Contributions If you are currently enrolled in a 2021 DCAP plan you will not be able to use 2021 contributions for reimbursement of expenses for dependents who turn 13 in 2021.
4. Expanded List of Eligible Items
The list of eligible expenses for your Health Care FSA has temporarily expanded to include, but is not limited to, personal protective equipment (PPE) such as masks, hand sanitizer, and sanitizing wipes that are purchased for the primary purpose of preventing the spread of COVID-19.
We hope the increased flexibility with your Health Care FSA, Limited Purpose FSA, and/or Dependent Day Care Account Program will help you make the most of your employee reimbursement account(s) during this unprecedented time.
