A qualifying life event (QLE) is a big life-changing situation — sometimes planned, sometimes unexpected — that can impact you and your health insurance. Experiencing a significant life change may allow you to change your health plan outside of the annual enrollment period (also called open enrollment). For more information, refer to the article What is a QLE?
Election changes can be made to your FSA, LPFSA, or DCFSA benefits. Typically, additional funds can only be used for expenses incurred on or after the effective date, usually coinciding with the first payroll following the approval of your Qualifying Life Event (QLE).
For example, let's say Janet elects $1,000 for an FSA at the beginning of the plan year and is carrying over $150 from the previous plan year. Janet gets married in April, which qualifies her to make an annual election change to take effect on May 1. She elects to increase her FSA to $3,000.
- She can claim $1,150 reimbursement for services incurred between January 1 - April 30
- She can claim up to a $3,150 reimbursement for services on or after May 1
- If she has a $2,000 payment, say, in March, she can only be reimbursed for $1,150 of it. This is because she does not have access to the additional funds (additional $2,000 due to QLE) until May 1.
If a Qualifying Life Event occurs as a result of adding a dependent, your effective date will retroactively align with the date of birth, adoption, or adoption placement.
Please note that it is not possible to decrease your FSA, LPFSA, or DCFSA election(s) to an extent where the total amount for the benefit period falls below the amount already spent or already contributed.