Flexible spending accounts have always been an attractive option for those on employer-sponsored health plans. But one provision has traditionally soured the deal for some.
FSA “use-it-or-lose-it” rules have required enrollees to use all of the tax-free money they put into FSAs by the end of the year (sometimes with a grace period), or they lose the money. Many unnecessary pairs of glasses have been bought as consumers try to get something of value with their lingering account balances.
But “use-it-or-lose it” has changed. In 2013, the Treasury Department amended the FSA rules, allowing consumers to roll over $500 from one year to the next. With an estimated 35 million Americans using FSAs, the new rule could have a huge impact.
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