HCRA/DCRA AWARDS A 2 ½ MONTH GRACE PERIOD EXTENSION
The U.S. Department of Treasury allows employers who offer flexible spending accounts under a cafeteria plan to extend a 2 ½ month “grace period” to participants during which eligible expenses can be incurred and reimbursed from December 31st to March 15th of the following year. Effective immediately, the CSU will extend the grace period to current and future participants of the Health Care Reimbursement Account (HCRA) and/or the Dependent Care Reimbursement Account (DCRA) Plan(s). As a result, the 2009 and 2010 Plan Year dates for the HCRA/DCRA Plans are as follows:
CSU 2009 HCRA/DCRA PLAN YEAR DATES
| PLAN YEAR |
START |
END |
| PLAN YEAR |
January 1, 2009 |
December 31, 2009 |
| 2 ½ MONTH GRACE PERIOD EXTENSION |
January 1, 2010 |
March 15, 2010 |
| CLAIM REIMBURSEMENT PERIOD |
January 1, 2009 |
June 30, 2010 |
CSU 2010 HCRA/DCRA PLAN YEAR DATES
| PLAN YEAR |
START |
END |
| PLAN YEAR |
January 1, 2010 |
December 31, 2010 |
| 2 ½ MONTH GRACE PERIOD EXTENSION |
January 1, 2011 |
March 15, 2011 |
| CLAIM REIMBURSEMENT PERIOD |
January 1, 2010 |
June 30, 2011 |
Only employees who are enrolled in HCRA and/or DCRA through December 31st can continue to incur claims under the grace period extension against the previous plan year for services provided through the following March 15th.
As a reminder, the HCRA/DCRA plan year is January 1st – December 31st of each calendar year, and participants must submit claims no later than June 30th of the following year after the current plan year ends. Under the grace period extension, all HCRA/DCRA claims for services incurred January 1st through March 15th of the following calendar year will automatically be processed against the previous plan year first if there is an account balance remaining after December 31st and filed by the claims filing deadline. Consequently, current HCRA and/or DCRA participants that have remaining account balances as of December 31, 2009, will be allowed to incur eligible expenses up to March 15, 2010, and claims reimbursement will be applied first to existing 2009 balances, and then applied to 2010 Plan Year balance(s), if applicable. Claims applicable to HCRA cannot be reimbursed from DCRA account balances, and vice versa.
Participants, however, can request that a claim incurred between January 1st and March 15th be applied to the current plan year balance rather than the previous plan year. Such requests must be in writing and submitted with the claim for special handling. Employees that are current participants in HCRA and/or DCRA, but did not re-enroll for the upcoming 2010 Plan Year, can utilize only the remaining 2009 account balance(s) for reimbursement of eligible grace period claims.