How to Spend Your FSA/HSA Dollars
If you have a health savings account (HSA) or flexible spending account (FSA), you may be wondering how you can best spend the money in those accounts. The good news is that there are many different ways to use your HSA or FSA dollars depending on your needs.1
What are health savings accounts and flexible spending accounts?
HSAs and FSAs are tools that can help you save money on healthcare costs. Both types of accounts allow you to set aside money pre-tax, which you can then use to pay for eligible healthcare expenses. HSAs are available to those who have a high-deductible health plan. The funds in the account can be used to cover the deductible and other out-of-pocket costs.1
FSAs are available to all consumers, but the funds in the account can only be used to cover specific healthcare expenses. Expenses can be things like co-pays, coinsurance, and prescriptions. FSAs also have a use-it-or-lose-it feature, which means any money left in the account at the end of the year goes away.1
How can you use HSA/FSA dollars?
Depending on your needs, there are many different ways to use your HSA or FSA dollars. Some common examples include using the funds to pay for:1,2
- Doctor's visits – Co-pays, annual exams
- Prescriptions – Co-pays, coinsurance
- Over-the-counter medicines – Aspirin, ibuprofen, eye drops, cold and cough medicine
- Family care expenses – Masks, hand sanitizer, diaper rash cream, breast pumps, breast milk storage bags, menstrual products, acne products, sunscreen, thermometers
- Vaccines – Flu shots, Covid shots, and other vaccines
- Emergency expenses – Urgent care and ER visits, ultrasound or MRI costs, x-rays, ambulance services
- Assistive devices – Wheelchairs, crutches
- Dental care – Braces, dental cleanings, orthodontist visits
- Vision care – Eyeglasses, contacts, eye exams, eye surgery
- Mental health services – Counseling, smoking cessation
- Alternative therapies – Acupuncture, massage therapy
Are there everyday expenses that are not covered?
It is important to note that HSAs or FSAs do not cover some ordinary healthcare expenses. Some of these expenses include:1
- Most over-the-counter supplements and herbs
- Personal hygiene items like toothpaste and deodorant
- Cosmetic procedures
- Weight loss programs
If you are unsure whether a specific expense is eligible for reimbursement, check with your HSA or FSA administrator. Check online with the company often, as plan and eligibility requirements can change.1
Also, your doctor can write a letter of medical necessity (LOMN) for some products or services that they deem necessary. This would allow you to buy items that are not usually covered under the HSA or FSA. Talk to your doctor about your specific needs and what your HSA or FSA covers.1
What about your spouse and dependents?
If you have a family, you may be wondering how your HSA or FSA can be used to cover their healthcare costs. In most cases, you can use your HSA or FSA funds to pay for any eligible healthcare expenses incurred by your spouse or dependents. This includes expenses such as doctor's visits, prescriptions, dental care, and mental health services.1
HSAs and FSAs are great tools for saving money on healthcare costs. So which option should you choose? It depends on your individual needs. Both have different eligibility requirements, so make sure you understand the differences before deciding which account is right for you. Talk to your benefits coordinator at work for more information.1
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