General COVID-19 Questions
Will PayFlex be updating the website FAQs for employers and employees?
We will update as more information becomes available.
If we decide we want to change our plan offerings, what do we need to do?
1. If you decide to allow mid-year FSA election changes:
- Update your Plan Document and Summary Plan Description (SPD) – you have until December 31, 2021 to formally amend your plan.
- Let your PayFlex Account Manager know.
- Make your employees aware.
- If needed, click here to download a member-facing template to assist with communicating to your employees. Feel free to use this template to deploy to your employees, or add to internal communications, intranet sites, etc.
- We can also deploy to your employees on your behalf (at no cost). To request a deployment, contact your PayFlex Account Manager. You’ll be asked to fill in the placeholder details within the template to help ensure employees have the accurate next steps.
2. If you decide to increase the health care FSA carryover amount to $550:
- Update your Plan Document and Summary Plan Description (SPD) – you have until December 31, 2021 to formally amend your plan.
- Let your PayFlex Account Manager know.
- Make your employees aware.
- If needed, click here to download a member-facing template to assist with communicating to your employees. Feel free to use this template to deploy to your employees, or add to internal communications, intranet sites, etc.
- We can also deploy to your employees on your behalf (at no cost). To request a deployment, contact your PayFlex Account Manager.
3. If you decide to extend your grace period, please know that our PayFlex teams are working together to fully understand the new guidance and its impact.
- We need to consider what’s possible via our systems (and operationally) to help ensure a positive client and member experience.
- Once we determine how to best administer an extended grace period, we’ll notify you/employers with next steps.
- In the meantime, below are important details to keep in mind:
- Extending the grace period may impact functionality of the PayFlex debit card. We’ll share more information as needed.
- Extending the grace period will also affect HSA eligibility.
- If a member is allowed the extended grace period to incur FSA expenses, they won’t be eligible to contribute to an HSA through the duration of the grace period.
- Members with a Limited Purpose FSA won’t be impacted.
Can the plan year be extended?
No.
Does COVID-19 have an impact on FSA’s use-it-or-lose-it rule? For example, will employees lose money even though many doctors’ offices are closing?
The IRS hasn’t announced any new guidance for FSA plan year requirements or the use-it-or-lose-it rule.
What do IRS Notice 2020-29 and IRS Notice 2020-33 change?
On May 12, 2020, the Treasury Department and the Internal Revenue Service (IRS) issued two notices to assist with the nation’s response to the 2019 Novel Coronavirus outbreak (COVID-19) for § 125 cafeteria plans during calendar year 2020. These notices impact Health Care and Dependent Care Flexible Spending Account (FSAs) -- IRS Notice 2020-29 and IRS Notice 2020-33.
Employers who offer a Health Care FSA and/or a Dependent Care FSA, can now choose to:
- amend their plans to allow employees to make election changes during calendar year 2020, without the need for a qualifying event.
- amend their plans to allow the 2020 carryover maximum of up to $550 for health care FSA.
- extend their FSA grace period until December 31, 2020.
Note: This guidance isn’t mandated and is retroactive to January 1, 2020. You, as the employer, can decide what you want to allow related to your plan offerings.
Is testing and treatment related to COVID-19 covered prior to meeting the annual deductible?
The Internal Revenue Service (IRS) announced that testing and treatment related to the Coronavirus Disease (COVID19) can be covered under a high-deductible health plan (HDHP), prior to meeting the annual deductible, without affecting HSA eligibility. Also, keep in mind that members can use their Health Savings Account (HSA) and Flexible Spending Account (FSA) funds to pay for testing and eligible medical treatment related to COVID-19.
Is personal protective equipment an eligible expense for flexible spending accounts (FSAs) and health savings accounts (HSAs)?
Personal protective equipment, like face masks and rubber gloves are eligible FSA and HSA expenses. You can request reimbursement through the PayFlex member website.