Vendor changeover to require pause in flexible spending reimbursements

Federal employees will not be able to submit medical or child care flexible spending reimbursement claims for a month later this summer.

The Office of Personnel Management announced on the FSAFEDS website in May that the claims submission process would be suspended in order to transition to a new provider. OPM in March chose WageWorks to run the FSA program. WageWorks will replace ADP, which ran the program since April 2003.

“The claims submission blackout period begins on Saturday, July 30, 2016 and ends Thursday, September 1, 2016. This means that no claims can be submitted during this period,” the announcement stated.

OPM says federal employees can submit claims via fax or online by 4:00 p.m., Eastern Time on Friday, July 29, or by mail no later than July 20 to ensure processing before the blackout period. Processing of claims is expected to resume on Sept. 8.

Employees also will not have online access to their FSA accounts for seven days beginning Aug. 26.

WageWorks says it will support about 1.8 million eligible federal employees with healthcare and dependent care Flexible Spending Accounts.

OPM decided to recompete the FSAFEDS contract last year after picking up on the option periods of ADP’s deal for much of the past decade.

The OPM inspector general wrote to acting director Beth Cobert in October expressing concerns over how long the agency’s contract with ADP has been in place. Then IG Patrick McFarland said the contract with ADP exceeded the limits detailed in the Federal Acquisition Regulations. The IG said the original FSAFEDS contract was set with a seven-year term, with an unlimited number of successive option periods.

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