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This paper develops a framework for analyzing flexible spending account (FSA) participation and usage. We explore patterns of FSA usage using data from a benefits firm for 1996 including an examination of types of FSA expenditures and their timing. We estimate some simple econometric models of the participation decision and also the decision of how much to put into an FSA. Several pieces of evidence suggest that much of an FSA election amount is based on foreknowledge of expenditures. We also find that participants tend to spend their election amount early, thus obtaining an interest-free loan.