Flexible Spending Arrangements (FSAs)

What are FSAs?

FSAs allow you to set aside pretax money from your paycheck to pay for out-of-pocket health care expenses. Setting aside a portion of your pay with an FSA reduces your annual taxable income. Your election will be deducted from your paycheck pre-tax throughout the plan year, so you don't pay FICA (7.65%) or federal income tax (up to 37%) on your elected dollars. Listen to the Fund Your Future DRS podcast episode: Save on healthcare costs with FSA and DCAP to learn more about FSAs.

Two types of FSAs

The PEBB Program offers: an FSA and a Limited Purpose FSA. The FSA covers a wide range of health care expenses. The Limited Purpose FSA covers only dental and vision expenses. It is intended for employees enrolled in a consumer-directed health plan (CDHP) with a health savings account (HSA).

What is an FSA?

The FSA allows you to pay for out-of-pocket health care costs like deductibles, copays, coinsurance, medications, menstrual care products, dental care, vision services, and more (see eligible expenses).

You can use your FSA to pay for expenses for you, your spouse, or your qualified tax dependents, even if they are not enrolled in your PEBB medical or dental plan.

What is a Limited Purpose FSA?

The Limited Purpose FSA allows you to pay for out-of-pocket dental and vision costs like glasses, contact lenses and solution, dentures, dental copays, orthodontia, and more (see eligible expenses).

You can use your Limited Purpose FSA to pay for dental and vision services for you, your spouse, or your qualified tax dependents, even if they are not enrolled in your PEBB medical or dental plan.

Am I eligible?

You are eligible if you are a PEBB benefits-eligible employee who works at a:

• State agency
• Higher-education institution
• Community or technical college

Note: Employees who work for a city, county, port, tribal government, water district, hospital, etc., are not eligible for this benefit.

How much can I contribute?

2025

• A minimum of $120
• Up to a maximum of $3,200

2024

• A minimum of $120
• Up to a maximum of $3,050

Why is the IRS maximum contribution limit different from what HCA adopts?

The maximum contribution limit is set by the IRS, and the amount is usually announced in late fall after HCA's annual open enrollment begins. Due to the timing of the IRS announcement, HCA adopts an increased maximum contribution limit for the following plan year.

How do I enroll?

You may be automatically enrolled in an FSA and awarded $250 by your employer if you are a represented PEBB subscriber and meet other criteria.

Note: University of Washington and Washington State University employees use Workday to enroll.

During open enrollment

• Visit the Navia Benefit Solutions website. Or, download and print the Open Enrollment Form on Navia's website.

When you're first eligible for benefits

• Submit the Midyear Enrollment Form to your payroll or benefits office no later than 31 days after the date you become eligible for PEBB benefits.

If you have a special open enrollment event

• Submit the Change in Status Form to your payroll or benefits office no later than 60 days after you or an eligible family member has a qualifying event that creates a special open enrollment.

Reminder: You must enroll in an FSA for each plan year you want to participate. Enrollment does not automatically continue year to year. If you want to enroll, make sure to choose this benefit again during each open enrollment.

What is carryover?

If you have not spent all the funds in your FSA by December 31, and you are still employed and didn't lose eligibility for the FSA, you may be able to take advantage of the carryover feature, where certain unspent funds may "carry over" into the following year without affecting annual maximums.

To carryover your unspent funds:

• You must enroll in either the Limited Purpose FSA or FSA for the following year, or
• Have at least $120 left in your FSA balance.

How much can I carry over to the next plan year?

2025

Unused funds up to $660 will carryover to 2026. Due to IRS rules, any funds above $660 will be forfeited to the HCA.

2024

Unused funds up to $640 will carryover to 2025. Any funds above $640 will be forfeited to the HCA.

Real-world carryover examples

Less than $120 remaining

A subscriber has $100 left in their FSA on December 31 (less than $120 minimum). If they enroll in an FSA, the $100 will carry over and be added to their FSA for the next plan year.

If they enroll in a CDHP for the next plan year, they cannot enroll in an FSA. However, if they enroll in a Limited Purpose FSA, the remaining $100 will carry over and be added to their Limited Purpose FSA for the next plan year.

If they do not enroll in an FSA for the next plan year, the $100 will be forfeited because it is below the $120 minimum.

Between $120 and $640 ($660 for 2025) remaining

A subscriber has $150 left in their FSA on December 31 (between the carryover minimum and maximum amounts). If they enroll in an FSA, the $150 will carry over and be added to their FSA election for the next plan year. If they do not enroll in an FSA, the $150 will still carry over to establish an FSA for their use in the next plan year.

If they enroll in a CDHP and a Limited Purpose FSA, the $150 will carry over and be added to their Limited Purpose FSA election for the next plan year.

If they do not enroll in an FSA, the $150 will still carry over to establish a Limited Purpose FSA for their use in the next plan year.

Over $640 ($660 for 2025) remaining

A subscriber has $670 left in their FSA on December 31 (over the $640 [$660] maximum that can be carried over). If they enroll in an FSA, $640 ($660) of the $670 will carry over and be added to their FSA election for the next plan year; the remaining $30 ($10) will be forfeited. If they do not enroll in an FSA, $640 ($660) will still carry over to establish an FSA for their use in the next plan year.

If they enroll in a CDHP and a Limited Purpose FSA, $660 of the $670 will carry over and be added to their Limited Purpose FSA election for the next plan year; the remaining $30 ($10) will be forfeited.

If they do not enroll in an FSA, $640 ($660) will still carry over to establish a Limited Purpose FSA for their use in the next plan year.

$250 CBA funds remaining

On December 31, a subscriber has $250 left in their FSA (that was established by their collective bargaining agreement [CBA]). If they enroll in an FSA, the $250 will carry over and be added to their FSA election for the next plan year. If they do not enroll in an FSA, the $250 will still carry over to establish an FSA for their use in the next plan year.

If they enroll in a CDHP and a Limited Purpose FSA, the $250 will carry over and be added to their Limited Purpose FSA election for the next plan year.

If they do not enroll in an FSA, the $250 will still carry over to establish a Limited Purpose FSA for their use in the next plan year.

How do I submit claims?

When you incur an eligible expense, you can submit a claim to request reimbursement one of the following ways below. You also can sign up for a debit card.

• Online: Navia Benefit Solutions
• Naiva Benefits Debit Card
• Mobile App: download for iPhone or Android
• Email: Navia claims
• Fax: 425-451-7002 or toll free 1-866-535-9227
• Mail: Navia Benefit Solutions, PO Box 53250, Bellevue, WA 98015-3250

When can I submit them?

You can start submitting claims for eligible expenses on or after the first day of your plan year, January 1. The full amount you set aside for your FSA contribution is available on January 1.

Are there deadlines?

Yes. You must incur all expenses by the end of the plan year, December 31, and submit all claims to Navia Benefit Solutions for reimbursement by March 31, of the following year. If you are no longer employed or have retired and still have money left in your account, you can still submit claims for reimbursement until March 31, so long as the services took place while you were employed.

Represented employees may receive a $250 FSA benefit

If you are a represented employee, you might be eligible to receive a $250 Flexible Spending Arrangement (FSA) contribution through your collective bargaining agreement. You are likely to receive this contribution if you meet all the following criteria:

• You are employed in a PEBB benefits-eligible position on January 1. 
• You are a union-represented employee.
• Your union is part of the Health Care Coalition, described in RCW 41.80.020(3).
• Your rate of pay on November 1 of the previous year is $60,000 or less for a full-time equivalent position. If you work part time, you may still qualify for the contribution if your position would provide a salary of $60,000 or less as full-time. For example, if you earn $30,000 and work 20 hours per week, your full-time salary would be $60,000 and you would still qualify. 
• You or your spouse or state-registered domestic partner are not enrolled in a consumer-directed health plan (CDHP) with a health savings account (HSA). 
• You met the other eligibility criteria as described in the Health Care Coalition Agreement, including PEBB Program eligibility requirements and eligible medical plan enrollment.

This benefit will not come out of your paycheck. It does not count against your annual maximum contribution.

If you are eligible for this benefit and already have an FSA, Navia will add the funds to your existing account. If you do not have an FSA, you will be enrolled and sent a Navia Benefits Debit MasterCard loaded with the $250. The debit card is sent in an unmarked envelope for your security.

What would make me not eligible to receive this benefit?

• Your rate of pay on November 1 exceeds $60,000.
• You or your spouse enroll in a CDHP with an HSA (this limitation is an IRS rule because both FSAs and HSAs are tax-preferred benefits).
• You waive PEBB medical coverage unless you waive to enroll as a dependent on someone else's PEBB medical plan that is not a CDHP with an HSA.
• You are no longer eligible for PEBB medical coverage (you retire or terminate or lose coverage by the date the benefit is distributed).

If you believe you qualify for the contribution and have not received it, contact your payroll or benefits office.

What happens to my funds when coverage ends?

When your PEBB insurance coverage ends, or you go on unpaid leave that is not approved under the Family and Medical Leave Act (FMLA) or military leave, you are no longer eligible to contribute to your FSA. Eligibility ends on the last day of the month you lose coverage or go on leave that is not FMLA or military leave.

You will be able to claim expenses that were incurred only while you were employed, unless you are eligible to continue your FSA under PEBB Continuation Coverage. You must submit claims for reimbursement by March 31 the following year.

Transferring to another agency or higher-education institution

You can continue your FSA election if the time between employment is 30 days or less and within the current plan year.

Submit the PEBB Agency Transfer form to your new employer's payroll or benefits office no later than 31 days after your first day of work. If you end employment or retire during the year, submit the PEBB Medical FSA Termination form to your payroll or benefits office.