Tips for Year End FSA Spending

NOTE: Published on December 29, 2020 - Some information may no longer be applicable in years following due to policy changes that were unknown when this article was published.

Flexible Spending Accounts (FSA) can be a great way to help manage health care costs. Most of us have experienced increases in copays and deductibles in recent years so planning and setting aside money for these expenses can really save you money.

What is an FSA?

An FSA is an employer sponsored healthcare related benefit offered to help cover the cost of medial related expenses. The main benefit of an FSA is that when you set aside FSA money (usually during an open enrollment period through your employer) it is taken out of your paycheck before you are taxed on the rest of you payroll income. This lowers the amount you are taxed and essentially allows you more money in your pocket - in this case to spend on healthcare costs.

An individual can opt to put aside up to $2,700 for the year (2020). The amount selected is broken out evenly over the 52 weeks of the year.

What is Covered by FSA Plans

While FSA plans can differ from program and employer, dozens of healthcare related expenses typically allow you to spend your allotted FSA money on them. Examples include:

• Personal Care Items - Sun care, eye/ear care, family planning, foot care, oral care, skin care

• Baby & Mother Care Items - Baby wellness Items, breast pumps, maternity and prenatal care items, baby health monitors

• Home Medical Care - Diagnostic products items, Diabetes care items, Home health care items

• Everyday Health - Over the counter medicines, pain relief items, first aid items, cold and allergy items, braces and support items, vitamins

Hundreds of specific items fall under each of these categories and subcategories so you really do have a lot of options and potential for spending your pre-taxed FSA money.

Be sure to check with your plan administrator and/or their guidelines of allowed expenses before making a purchase to use your FSA allowance.

What to Do with Remaining FSA Dollars

At this time of year, many of us have money left over in our FSA account. Typically, this money falls into a use it or lose it scenario. But some plans and/or FSA accounts allow $500 to roll over into the coming year with a grace period of 2.5 months to use this rolled over amount (typically by March 15). It’s always a good idea to check with your FSA administrator to verify roll over amounts, time line and eligible items.

If you have money rolling over, take some time and see what items you need that are FSA eligible. If you have not ordered medical supplies like a CPAP mask or cushions, this is a great opportunity to do so. Remember, having new supplies makes it much easier to use your CPAP and treat your sleep apnea.

Many of you have ordered supplies recently using our convenient Resupply Portal. Don’t forget you can use FSA dollars for items such as the SoClean CPAP sanitizer, Portable CPAP machines like the ResMed AirMini and Respironics Dreamstation GO, CPAP mask wipes or the CPAP Portable outlet battery.

Another Year is Ending and a New One Begins.

As 2020 comes to a close, we would like to wish all of you a happy and health 2021. Please reach out with any questions you might have regarding eligible FSA products or items.