Our colleague at Epstein Becker Green Michelle Capezza recently posted this on the Technology Company Counselor blog:

Cafeteria plans which provide a health flexible spending arrangement (FSA) allow participants to make pre-tax salary contributions to an account in order to receive reimbursements to pay for medical expenses that are not reimbursed through insurance or another arrangement (e.g., co pays, deductibles, eyeglasses). Prior to the Patient Protection and Affordable Care Act of 2010, sponsors of these plans could set an annual limit for contributions to health FSAs per plan terms. Sponsors typically established such limits by taking into consideration the uniform coverage rule which requires that if a participant elected the maximum amount permitted and incurred a reimbursable claim early in the year, the claim would need to be paid even if the full salary reductions up to that limit had not yet been made. Effective for cafeteria plan years beginning after 2012, the Affordable Care Act requires that health FSAs limit employee salary reduction contributions to $2500 per plan year (to be indexed for cost of living adjustments). Cafeteria plans must be amended to reflect this new limit (or a lower limit) before December 31, 2014 but must operate in compliance with these changes in the law for plan years beginning after December 31, 2012. The limit does not apply to certain employer flex credits, health savings accounts, health reimbursement arrangements or contributions used to pay the employee share of health premiums.

Read the full post on the Technology Company Counselor blog.