Please expect a slight delay in claims turnaround due to COVID-19 staff precautions.
COVID-19 FAQ's
Keystone Flex Administrators, LLC is actively monitoring the COVID-19 situation on a daily basis, along with any legislative updates that may be released.
First and foremost, we are still here to SERVE YOU!
A few things you may need to know:
Q: With so many schools and daycare's shutting down we have received a number of questions regarding if an employee’s dependent care facility closes, is that a qualified life event and can an employee stop their contributions to the Dependent Care Flexible Spending Account (DCA)? Also, when the daycare reopens, would that be considered a qualified event and then employees can elect and make a new contribution to the DCA?
- Yes, this is considered a qualifying event. Even if the employee is working from home and keeping their child at home, since they are no longer making payments to the daycare, that is a change in the amount owed to the DCA (which is a qualifying event).
Q: Can an employee open a DCA now that school is closed and they are in need of childcare?
- Yes. If an employee doesn’t have a DCA but now needs to pay for childcare, they can open a DCA to cover IRS-approved DCA expenses.
Q: What if I have a change in home child care provider?
- You may increase or decrease your election amount consistent with a change in cost for a new home child care provider, including a change in a nanny-sharing arrangement. However, IRS regulations do not allow a Dependent Care FSA election change for a cost increase by a child care provider who is a relative.
- If there is a change in your home child care provider because a relative or friend has agreed to watch the child for free, you may decrease or cancel your Dependent Care FSA enrollment.
- If you or your spouse change work schedules (including to or from part-time status), changing the hours when outside care is required and the amount of eligible dependent day care expenses, you may increase or decrease the amount consistent with the change in cost.
Q: HSA Contribution extension?
- Under IRS Notice 2020-18, issued March 18, the grace period for Health Savings Accounts (HSAs) has been extended to July 15, 2020, from April 15, since the due date for filing federal income tax returns is now July 15. HSA participants can make 2019 contributions to their accounts up to the maximum contribution limit for last year until the new deadline.
Q: Will there be a claims extension beyond the standard March 31,2020 deadline?
- A: It was announced at the end of April 2020 that the RUN OUT to all plans was extended allowing employees more time to file claims. **NOTE: At the beginning of May an OPTION has also been made available to employers to extend the GRACE PERIOD of their previous plan years through December 31, 2020. ALSO, employers with a plan year beginning in 2020 that currently have the $500 rollover feature on their plan have been given the opportunity to increase the Rollover amount to $550. ***Please contact our offices to see if your employer applied these optional changes to your plans with us.
Q. COBRA Deadline Extensions - Employer/Employee
On April 28th, 2020, the Department of Labor (DOL) issued EBSA Disaster Relief Notice 2020-01, which extends COBRA grace periods to all plan participants.
Here is what you need to know:
- This extension applies to both the COBRA election time frame as well as monthly COBRA premium payments
- The extensions are backdated to the date that President Donald Trump declared a national emergency, March 13, 2020.
- The extension will continue 60 days from the date the national emergency is officially declared as over.
Details on extensions below :
(1) the 30 day deadline for employers or individuals to notify the plan of a qualifying event
(2) the 60 day deadline for individuals to notify the plan of a determination of disability
(3) the 14 day deadline for plan administrators to furnish COBRA election notices
(4) the 60 day deadline for participants to elect COBRA
(5) the 45 day deadline in which to make a first premium payment
(6) the 30 day deadline for subsequent premium payments
For additional information about the DOL notice click here.
**All Keystone contact information is provided on all COBRA notices sent out to employees. Employees will need to contact Keystone directly with any questions regarding application of these available extensions.
NEW Legislation - CARES ACT
The COVID-19 relief bill has officially been signed into law. This bill references the CARES ACT which includes provisions that make over-the-counter (OTC) medicines and menstrual products FSA, HSA, and HRA (if applicable to your HRA plan parameters) eligible. With this change, OTC items no longer require a prescription, and menstrual products are eligible for the first time.
Keystone is here to help make the transition for your employees as easy as possible in reference to these new regulations. We believe this is a positive change to the plans, that will further aide families during this pandemic!
Employees cannot YET purchase OTC or menstrual care items using their WEX Health card. Several things must occur before the debit cards (if applicable to your plan) will swipe for these newly eligible items. We have included a projection of that timeline below. This change will retro-back to 1/1/2020.
- The Special Interest Group for IIAS Standards (SIGIS) board must first adopt these new standards and publish the revised Eligible Product List.
- Merchants (ex. Walmart, Walgreens, Target, etc.) must update their systems with the new list mentioned above as well.
- It is expected that merchants will start adopting changes for OTC items around April 15, 2020 and menstrual care products around May 15, 2020. However, the timeline for when merchants will make this update could be later, as there is no way to predict their internal processes.
Until the debit card network is updated and fully functioning, and for any previously incurred expenses for 2020 that employees may have already had, Keystone will process those claims manually. Claims can be filed via the online employee portal, mobile app, or via email/fax/mail (manual claim forms can be obtained under the "forms" tab of this website).
We will continue to monitor any new developments on this daily, and post any necessary updates to this page. You can also visit FSAStore.com for additional information.
Consolidated Appropriations Act 2021
Summary
On December 27, 2020, the latest COVID relief bill, the Consolidated Appropriations Act, 2021, was signed into law. The law includes several provisions that provide relief for health and dependent care flexible spending accounts. Employers may, but are not required to, permit the following:
● Carryover of unused funds, with no dollar limit, from a plan year ending in 2020 and/or 2021 to a plan year ending in 2021 and/or 2022; or
● Extension of the grace period to up to 12 months after the end of the plan year for a plan year ending in 2020 and/or 2021.
The above applies to both health and dependent care FSAs.
● Employees who cease participation in a health FSA during calendar year 2020 or 2021 may continue to receive reimbursements from unused benefits or contributions for claims incurred through the end of the plan year in which such participation ceased (including a grace period if applicable).
● Increase the maximum age (by one year) for certain dependent care beneficiaries who aged out during 2020 and provide additional relief for such dependent care beneficiaries in 2022.
● Prospective modification of election amount for health and dependent care FSAs for a plan year ending in 2021.
As stated above, these provisions are not mandates, but are options for employers to consider. Plan amendments must be made by the end of the first calendar year beginning after the end of the plan year in which the amendment is effective (for example, calendar 2020 plan amendments must be adopted on or before December 31, 2021), provided the plan must be operated consistent with the terms of the amendment beginning on its effective date.
Please note that while we wanted you to be aware of the provisions in the law and have a chance to consider them, the law is quite voluminous and additional IRS guidance may be forthcoming. In addition, Keystone cannot provide legal or tax advice regarding this law or its requirements. For those questions, you should consult your own counsel.