New FSA cap courtesy Patient Protection and Affordable Care Act

[RainMom]

Yes, it's another post about "Obamacare"

Just noticed in reviewing my benefit package for 2013 that in compliance with the "Patient Protection and Affordable Care Act", contributions to FSA will be capped at $2500 yearly, half of what my plan allowed last year. Now, luckily and counting my blessings, my family does not have any chronic health issues that cause me to expect large medical expenses. But learning about this does aggravate me since I have friends who have large yearly medical expenses & have found that their contributions (and tax savings) have been drastically reduced.

Yes, of course, everyone can save back for those expected expenses on their own, but we all know it is much harder to save it once it has hit your bank account, rather than having it deducted from your check. So, I would conclude we will probably see more financial hardship for many families who are not as prepared for these expenses as they maybe would be normally. Kind of makes the "Affordable Care" a little bit harder doesn't it?

It doesn't make sense to me that this would be done other than the government will make a few more tax dollars on our lost contributions. And a few more families may have to look to public assistance due to hardship. Any thoughts?

[rnsrgr8t]

I agree. I never understood why they took away the ability to buy over the counter medicines without a perscription. What difference does it make if it is my money? The difference is a few more tax dollars coming their way. It is a shame because flex spending accounts are a good way to plan for your out of pocket medical expenses that a lot of us have!

[MunoRN, RN]

If you're using an account to cover unexpected medical expenses then you should be using a health savings account, not a flexible spending account. HSA's are for covering the otherwise uncovered costs with a high deductible plan, essentially filling the deductible and co-insurance hole.

FSA's are intended for expected expenses; braces, planned cosmetic surgery, etc. which is why they are "use it or lose it" from one year to the next. HSA's on the other hand roll over each year. If you want a higher cap and something intended to cover unplanned costs, use an HSA not an FSA.

[RainMom]

I understand the difference between FSA & HSA; my employer only offers the FSA & does not offer a high deductible plan which qualifies me to get my own HSA. I would definitely prefer the HSA which we had previously through my hubby's insurance. I'm just saying it doesn't make sense to cut the allowed contribution in half for those who do use an FSA.

On a side note, if you DO have a HSA, there is now a $200 increase in what you are allowed to contribute yearly per family.

[RainMom]

FSA's are intended for expected expenses

My exact point. I have a friend who has thousands of expected medical expenses every year for her 5 year old. She & her husband always put the max allowed into the FSA offered by her employer.