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A new lawsuit could shed light on how the federal courts interpret the rules for workers with flexible spending accounts who leave their employers.
Alperen Yagci and Anngi Lorena Bolanos Quinonez — two residents of Princeton, Texas — have sued Cigna Health and Life Insurance Company and JPMorgan Chase in the U.S. District Court for the Eastern District of Texas over allegations that they violated the Employee Retirement Income Security Act by stating that Yagci is no longer entitled to use his FSA.
JPMorgan was Yagci's employer, and Bolanos Quinonez was his adult dependent. Yagci began working for JPMorgan in 2018. He was terminated July 9, 2023. When he was terminated, he had $2,617.59 in his FSA, which was called a health care spending account.
Cigna administered the FSA.
When Yagci left, he received a notice showing that he could incur FSA expenses until July 31, 2023, and could submit claims for those expenses up until March 31, 2024, according to an exhibit filed along with the complaint.
But, immediately after Yagci left JPMorgan, his FSA debit card stopped working, and customer service representatives at Cigna said he could no longer use the FSA.
"Defendants did not provide plaintiffs with a clear, ERISA-compliant written explanation of the reasons for the claim denials or a meaningful opportunity to pursue an appeal," the plaintiffs said.
Bolanos said in a statement about the suit, "All I can say is that it's unfortunate Congress enacted ERISA in a way that shields insurance companies, leaving people like me with no real choice but to go to court simply to obtain what I am owed — nothing more."
Representatives for Cigna and JPMorgan could not immediately be reached for comment.
What it means: The federal government has set complicated rules for what happens when employees with FSAs, health savings accounts, health reimbursement accounts and other personal benefit accounts leave their employers.
The Internal Revenue Service, for example, describes its interpretation of the rules in Publication 969.
Any public rulings issued in the connection with the Texas FSA case may provide insights about how federal judges interpret the notice requirements, administrative requirements and appeals requirements for terminated workers who have FSAs.
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