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  • Health care spending account contribution balance as of 1/1: $2500.
  • Major Health issue + expenses. Went to short-term disability on 2/2.
  • Spent the whole $2500 in my HCSA by 2/10. My total contribution for the year by 2/2 was $190.
  • Went on long-term disability 5/1 through 11/1.
  • Currently, there is negative balance in my HCSA of -$2570.
  • Returned to work for same company with no HCSA contribution.

What will happen next? Am I going to be responsible for the negative balance? The new year will start with new HCSA account; is it going to be impacted?

  • I'm surprised they let you run the account negative at all. I would certainly assume that they expect you to repay that loan.To find out what they expect you to do, you will have to ask your employer. – keshlam Nov 27 '16 at 2:16
  • I'm voting to close this question as off-topic because we can't tell you what your employer's policies will be. – keshlam Nov 27 '16 at 2:16
  • For anyone wondering, an HCSA (Health Care Spending Account) is another name for a Health FSA, which features "uniform coverage" and "use it or lose it." – Ben Miller - Reinstate Monica Nov 27 '16 at 4:28
  • @keshlam An FSA is not a loan. They can be completely spent at the beginning of the year before all the money is contributed, and do not need to be paid back if the employee leaves the job. – Ben Miller - Reinstate Monica Nov 27 '16 at 4:31
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The first place you need to look is any place your company has their HR policies. If you can't find them, ask HR for them. The documents should address what happens during each type of potential leave. And just as important, what happens when you return from leave. I would expect that current policies are given to employees while applying for leave.

In companies I have worked for, what happens depends on if are you still receiving a check from your employer. If you are then they will attempt to withhold the amount of the FSA. Of course if the check is smaller they may not be able to do so.

When I have been on short term medical leave the check was either from the company or from a 3rd party insurance company. In both cases money was withheld and the FSA was still active.

The documents from HR should also address what happens if no money is withheld. This can be if the check is too small, or if they type of leave is unpaid or if the company decides to not require the payment. I have even seen cases where an employee could decide to pay the FSA by check, or change their contribution amount after they returned from leave.

Coverage during your leave of absence will determine if an expense during your leave is covered. You will need to know the exact days of coverage. Again HR should provide this. Catching up by check can allow you to make claims for the period where you would have been ineligible.

I am surprised that HR hasn't provided this information while on leave. In general if they are going to allow you to change your deduction they would give you a deadline for making your decision.

One piece of good news is that if the calendar year ends with you in negative territory, they won't make you pay them back. Your negative balance is made up by all those who don't spend the money by the deadline.

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