Medical Flexible Spending Account (FSA)

The Medical Flexible Spending Account (FSA) enables the employee to pay for expenses allowed under Sections 105 and 213(d) of the Internal Revenue Code, and which are not fully covered by the group benefit plan, with pre-tax dollars. The Medical FSA allows the employee to be reimbursed for expenses incurred by the employee and the employee's dependents. Visit irs.gov or ASIFlex for a full list of qualified medical expenses. The State Plan's Medical FSA is administered by ASI Flex.

For plan year 2024, the annual maximum contribution per employee is $3,050.

For plan year 2025, the annual maximum contribution per employee is $3,200.

Medical FSA can be used for

• Deductibles, copays, and coinsurance not covered by health insurance
• Out of pocket prescription drug costs such as copays
• Medical, prescription, dental and vision non-covered expenses
• Eligible Over the Counter (OTC) Drugs and Medicines 
• Complete list of qualified medical expenses

Other Restrictions

• $120 per year minimum contribution 
• $2.16 per month fee for one or both types of FSA
• Contribution amounts may forfeited to the State of Montana if the employee does not fully use the contributions that have been made.
• $640 of unused contributions at the end of Plan Year 2024 will be allowed to rollover to Plan Year 2025. $660 of unused contributions at the end of Plan Year 2025 will be allowed to rollover to Plan Year 2026.  (Please note this amount may be adjusted based on IRS determination, which is usually announced in the fall.) 
• If an employee qualifies for rollover but has not elected to contribute to Medical FSA for the current Plan Year, a monthly administration fee of $2.15 will be applied to the rollover balance each month there is a qualifying balance. 

The employee may forfeit amounts to the State of Montana if the employee does not fully use the contributions that have been made. It is important the employee decide how much to place in their Medical FSA account before the Plan Year begins. See the medical flex calculators on the ASIFlex website for assistance in determining your appropriate contribution amount.  

During the course of the Plan Year, the employee may submit requests for reimbursement of expenses the employee or their eligible dependents have incurred. Expenses are considered "incurred" when the service is performed, not necessarily when it is paid. The entire yearly Medical FSA contribution may be used starting on the FSA effective date.

For the Medical FSA, the employee must submit claims no later than 120 days after the end of the Plan Year. Rollover funds become available for the new Plan Year on January 1, however those funds cannot be used for prior year services after the 120 day claim submission deadline. Claims for previous Plan Year must be submitted no later than April 30. 

A terminated employee has 120 days from date of termination to submit claims for eligible services incurred prior to the terminate date. Failure to submit claims within 120 days will result in any available contributions being forfeited. In some circumstances an employee may have the ability to elect COBRA for Medical FSA due to termination. Learn more at benefits.mt.gov/COBRA. 

See the Wrap Plan Document for more details about ASIFlex flexible spending accounts. Contact ASIFlex if you have any questions regarding eligible expenses or how to submit a claim for reimbursement.