Principal Issues: Whether the credits allocated to a health care spending account that are unused as a result of the COVID-19 pandemic and expiring, may be carried forward without affecting the status of the plan as a PHSP?
Position: In these extraordinary circumstances (due to the COVID-19 pandemic), a HCSA that qualifies as a PHSP and which has unused credits expiring between March 15, 2020 and December 31, 2020, could allow a one-time carry forward of those unused credits for a reasonable period to allow members to access services that were otherwise restricted during the COVID-19 outbreak. A period of up to six months would generally be considered reasonable and would not, in and of itself, disqualify the HCSA from being a PHSP.
Reasons: See response.