October 25, 2022

The open enrollment period for the New York state Flex Spending Account (FSA) for 2023 opens Nov. 1 and runs through Dec. 12.

The FSA is a negotiated benefit which provides eligible employees with the ability to pay for certain health care, dependent care and/or adoption expenses using pre-tax dollars. Enrollment is voluntary; people who sign up for FSA decide how much to have taken out of their paychecks on a pre-tax basis and put into their FSA accounts.

Through the FSA, employees can choose from three different benefits. They are:

• The Health Care Spending Account (HCSA): Lets employees set aside any amount from $100 up to $3,050 to pay for eligible health care expenses not paid for by health benefits coverage.
• The Dependent Care Advantage Account (DCAA): Allows employees to set aside up to $5,000 in pre-tax dollars for eligible custodial child care, elder care, or disabled dependent care expenses.
• The Adoption Advantage Account: Lets employees pay for eligible adoption-related expenses with pre-tax dollars.

The FSA 2023 flyer and the FSA 2023 Enrollment Book contain detailed information about the FSA program.

Increased Employer Contribution to DCAA

Following our advocacy on the issue, the state has agreed to increase the employer contribution to individual DCAA accounts. These contributions, which vary based on a salary-sensitive sliding fee scale, will increase by $200 in 2023. Employer contribution amounts for 2023 are below:

More time to use it

For the first time, the FSA program includes a carryover for HCSA accounts and a grace period for DCAA and Adoption Advantage accounts. These options will alleviate many of the use-it-or-lose-it concerns that some of our members have had about setting aside pre-tax dollars for FSA use.

Providing flexibility to apply unused prior year contributions to pay for subsequent year expenses, described in greater detail below, reduces the risk that members will lose unspent funds at the end of a plan year.

HCSA carryover

Unused HCSA contributions will carry over to the next plan year for enrollees to use. During the plan year runout period (Jan. 1- March 31, 2023), plan year 2022 funds may still be used for 2022 expenses. At the end of the runout period, any remaining funds from 2022, up to the IRS limit, will then carryover into the 2023 account balance and can be used to cover 2023 expenses.

The current IRS carryover limit is $610.

DCAA and Adoption grace period

The grace period allows an additional 2.5 months to incur dependent care or adoption-related expenses. Enrollees may use any funds remaining in their accounts at the end of 2022 to pay for expenses incurred between Jan. 1 and March 15, 2023. Claims must be submitted by the March 31 deadline.

For more information, contact UUP’s Benefit Trust Fund at 800-887-3863.