QLE: Only Option HDHP but we have FSA for 2020

[nashvillenonna]

We were covered under my husbands medical and have an FSA through my work.  My husband is going part time so we are enrolling in my companies medical plan which is a HDHP.  To date I have contributed 1150 into the FSA and have been using it for medical, dental and vision reimbursements.  We still have roughly $350 in the account.  

My questions is, can we continue to contribute to the FSA and use it for medical now that we are moving to the HDHP or do we lose out on the balance?  My company does not have a limited FSA, only full FSA or HSA.  My understanding is that I can't switch mid year to the HSA.  

Jan 1-June 30: Regular medical with FSA

July forward will be the HDHP

Thank you in advance for you response.  

[Opus 17]

Since this is not a limited purpose FSA, you having an FSA disqualifies you and your spouse from contributing to an HSA at the same time.  You would only be able to contribute to the HSA starting in January 2021 assuming you don't re-enroll in the FSA.  (Or if your FSA is on a different plan year, you have to wait for the new plan year to start.)  You can have an HDHP and an FSA at the same time, but you can't qualify to contribute to the HSA that often goes along with an HDHP.  

Your spouse's job change might be a qualifying event that would allow you to change health coverage at your job and cancel the FSA mid-year.  You would have to ask your HR department.  HR would also have to advise you on the remaining balance in the FSA.

The important point is that as long as your medical expenses are eligible for reimbursement from an FSA, neither you nor your spouse can make contributions to an HSA. 

[nashvillenonna]

My question is not if I can contribute to HSA it is can I use the FSA funds I have and continue to contribute to the FSA when we move to the HDHP at my job.  We don't have an HR person who knows the rules.  She is a clerk who only processes the paperwork.  

[Opus 17]

You may contribute to and use the FSA for medical expenses no matter what kind of insurance you have.  The FSA only blocks your ability to contribute to an HSA; the FSA doesn't otherwise care about what kind of coverage you have.