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health care Flex Spending Account and maternity leave

LilyAnna06LilyAnna06
in 2nd Trimester

I have a question about my FSA and since I'm not "out" at work yet I don't know who to ask. Maybe someone here will know.

So with the FSA, all the money you plan to allocate for the entire year is available on Jan 1, even though you haven't technically earned it yet.

 

How does that work with unpaid maternity leave, since if I take 12 weeks, I won't actually be "earning" a paycheck for the money to be deducted from? If, for example, I allocated $100 a month to my FSA, would I somehow owe that $300 at the end of the year? Would more be deducted from my paychecks after I return from maternity leave to cover what I didn't earn?

I know that in a situation where someone has quit or retired mid-year and had already spent all their FSA money, my employer is just out the rest of the money and our attorney told us there is no recourse to recoup it. We had a guy with a history of cancer who allocated $6000 one year, spent it all by the time he retired in June, and my employer had to cover over $3000.

But I'm not quitting, I'm coming back... I just won't be working for three months of the year. How does this work?

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Re: health care Flex Spending Account and maternity leave

  • bonnin507bonnin507
    From what I know, your $100/mo would adjust to make up for what you missed, but I would talk to your payroll just to clarify.  As for your coworker who retired & left the company w/ the rest of his FSA, that seems odd to me.  Both mine & my DH's FSA plans require us to pay back anything we used but did not earn. 
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  • mrsawtry2Bmrsawtry2B

    Your company should be able to set up a payment plan with you to either start collecting the money now (like paying in $200 instead of $100) or allowing you to make up the missed payments when you return (they will probably choose the 1st option as the second is more of a risk to them).  This is also true with medical/dental benefits.  Just because you are out on leave, your deductions for these benefits are still due.  If you won't be earning any money, but will be using PTO, they will deduct these items from your check the same as they have been prior to your leave.  However, if you are taking an unpaid leave and therefore there's nothing to deduct these items from, you will have to pay, regardless, in some fashion. 
    I work in HR, but you need to check with your HR dept as all companies are different and have different policies.

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  • mrsawtry2Bmrsawtry2B

    imagebonnin507:
    From what I know, your $100/mo would adjust to make up for what you missed, but I would talk to your payroll just to clarify.  As for your coworker who retired & left the company w/ the rest of his FSA, that seems odd to me.  Both mine & my DH's FSA plans require us to pay back anything we used but did not earn. 

    This actually happens quite often with medical FSA since those funds are available to you immediately (your full election amount).  Dependant Care FSA is different (thank goodness) since it is set up only as a reimbursement of money spent.
    Both, however, are Use it or Lose benefits.  Which does suck for people sometimes.  

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  • DrBeepersWifeDrBeepersWife member

    At my company, I have to pay for my benefits out-of-pocket while I am out on disability.  It will be upwards of $500 a month for healthcare and FSA.

    As far as paying it back, I don't know what they will do.  I plan on leaving shortly after this one so I guess I will find out.

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  • LilyAnna06LilyAnna06

    Thanks for the responses. That was very helpful. We're a smallish organization with the bare minimum of HR help.

     

    I'm in the public sector and I don't have a monthly insurance premium for myself, and LO will be going on DH's insurance. Based on what I've seen with other employees, I don't think I'll owe anything for that.

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  • bwm2bmwbwm2bmw
    I can only take out what I've put in so if I were doing $100/month like in your case, I could only get reimbursed $300 when I left on maternity in March. Even though my actual daycare costs far exceeded the $300 I can still only request reimbursement for what I've already contributed.
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