Open Enrollment is the time for employees to enroll or re-enroll in an FSA if you want to continue the plan in 2021. To participate, you must contribute a minimum of $180 per year. An FSA allows you to pay for eligible expenses on a pretax basis. As a result, your salary is reduced before taxes are assessed, and you pay less in taxes.

New FSA administrator: What you need to know

UC has engaged with Discovery Benefits as our new FSA and COBRA Plan Administrator, effective Jan. 1, 2021. Your 2021 FSA election will be managed by Discovery Benefits. However, WageWorks will still manage the grace period and run-out period for UC participants until April 15, 2021.   

Please note:

  • If you enroll in an FSA for 2021, you will receive your new debit card from Discovery Benefits by Jan. 1, 2021. 
  • As of Jan. 1, 2021, the FSA debit card issued by WageWorks will no longer be active.
  • You can continue to access your WageWorks online account through April 15, 2021. Submit your eligible 2020 claims online, fax or mail to WageWorks by April 15, 2021.
  • The carryover amount (increased to $550) will be transferred from WageWorks to Discovery Benefits. It will be available mid-May 2021. 

Health FSA

The Health FSA allows you to pay for eligible medical expenses for you and your eligible family members. You may contribute a maximum of $2,750. If both you and your spouse are UC employees, you may each contribute up to $2,750.

As a reminder, the Health FSA lets you carry over up to $550 of unused funds to the next plan year provided you are a participant as of the last day of the plan year (Dec. 31). With the carryover, if your balance is less than $550, you do not have to rush to spend all of your Health FSA funds or worry about losing money when the 2020 plan year ends.

You have until Dec. 31, 2020 to incur eligible expenses for the 2020 plan year. The plan’s deadline to file claims for expenses incurred during the 2020 plan year is April 15, 2021. After the April 15 deadline, unused funds up to $550 will carry over to the 2021 plan year and be available for reimbursement in early May. Unused funds greater than $550 will be forfeited.

The carryover amount does not count against your Health FSA election for the following plan year. You may still elect the maximum of $2,750 per plan year.

Carryover rules — if you do not re-enroll

You must have at least $25 remaining in your Health FSA after the run-out period (April 15 of the next plan year) to be able to carry over funds to the next plan year. Funds under $25 are forfeited. You may only carry over funds (up to $550) for one year.

Dependent Care FSA

The DepCare FSA allows you to pay for eligible expenses for care of your child (up to age 13) or eligible adult dependent. You may contribute a maximum of $5,000. If you're married and filing separate tax returns, you may each contribute $2,500.

UC’s DepCare FSA offers a grace period from Jan. 1 through March 15 of year following your enrollment. If you enrolled for 2020, you can continue to submit eligible expenses incurred during the grace period and be reimbursed with funds left over from 2020, as long as you are an active employee. All claims for the 2020 plan year must be filed by April 15, 2021. There is no carryover feature for the DepCare FSA. 

Re-enrolling in 2021

Reviewing your FSA account information can help you plan for re-enrolling in 2021. You must re-enroll during Open Enrollment if you wish to participate. To avoid forfeiting money through the IRS “use-it-or-lose-it rule,” be sure to carefully estimate your planned expenses and make a conservative election based on that estimate.

Due to continuing uncertainty into 2021 caused by the pandemic, you will be allowed to start, stop or change your DepCare FSA elections because of changes in the cost or availability of eligible care. However, if you expect to use your DepCare FSA at the beginning of 2021, you need to re-enroll during the Open Enrollment period. 

Advantages of a Health or Dependent Care FSA

  • A planned approach to paying expenses — You set aside money that you will have to pay anyway in a pre-tax account from which you can draw to pay eligible expenses.
  • Affordable pre-tax contributions — You contribute an equal portion of the total annual amount of your account by pre-tax deductions each pay period.
  • Tax savings — Because your deductions are taken before taxes, your tax liability is reduced.
  • Health FSA Benefit card convenience — You will have a card that you can use for qualified expenses at participating providers’ offices, drug stores and most pharmacies where credit cards are accepted, so you won’t have to pay out-of-pocket or file reimbursement claim forms. (Be sure to always save your receipts in the event of future requests by the FSA vendor or the IRS to verify that the purchase is valid.)

Enrolling in the UC Health Savings Plan

If you enroll in the UC Health Savings Plan, you cannot enroll in the Health FSA. You must have a zero balance in your Health FSA on Dec. 31, 2020.

You may forfeit any unused Health FSA funds, including carryover funds, by submitting the Health FSA Carryover Waiver Form to WageWorks by Dec. 31, 2020. To submit the form: