Thumbs Down: No Flex Account Action

Physician's Money Digest, February28 2005, Volume 12, Issue 4

An effort by Congress to get the USTreasury Department to drop theuse-it-or-lose-it rule for flexible spendingaccounts (FSAs), which help employeespay for medical expenses, hasrun into a stonewall. The TreasuryDepartment rejected the rule change,although it did hold out some hope fora grace period that would allow FSAholders to siphon cash from theaccounts for some unspecified amountof time after the end of the year.Under the current rules, an employeeforfeits any money left in the accountat year's end. The Treasury's lack ofaction may fuel demand for the newhealth spending accounts, which allowthe account holder to accumulate anymoney left in the account.