What is a Flex Plan?

A flex plan can either be a spending account only, or a full flex plan. The major characteristic of a flex plan is the 12-month enrollment period. You define the plan's start date (month and day) which determines the flex plan year. All enrollments in the flex plan will be stopped automatically at the end of each plan year. Coverage or contribution levels must then be re-elected for the new plan year, even if the same coverage or contribution level is desired.

When you define flex plans, you determine if your flex plan is a spending account only or a full flex plan. You need to consider the following when you define a flex plan:

  • Spending account only or full flex plan

  • Who is eligible for plan participation

  • How you want to issue flex credits

  • How you want to manage unspent flex credits

Spending Account Only

A spending account only flex plan is defined when the only benefit which will be attached to the flex plan is reserve spending accounts. (i.e. the type of plans that allows pre-tax contributions to be used for reimbursement of qualified medical or dependent care expenses.) This type of flex plan involves minimal set-up, and enables the application to enforce the 12 month enrollment period that is normally a feature of spending account plans.

Full Flex Plans

There are two major characteristics to a full flex plan: flex credits and the 12 month enrollment period. For all employees associated with a full flex plan the following is true:

  • At least one flex credit record must be defined for each flex plan year

  • An employee must have a flex credit record for the flex plan year to enroll in any benefits

  • An employee may receive or spend flex credits by enrolling in benefits

  • The stop date for all benefits will default to the last day of the flex plan year

For the application to determine when to allocate flex credits, a frequency table must be associated to flex plans. All benefit plans within the Flex Plan must use the same frequency table as the flex plan. The frequency table determines both the amount of standard time records and the pay cycles when flex credits are added.