What is FSA eligible items?
Flexible Spending Accounts (FSAs) are accounts offered by employers to their employees, which allow them to set aside a portion of their pre-tax income to cover medical expenses. These accounts are a valuable tool for individuals to manage their healthcare expenses, but it is important to understand which items are eligible for reimbursement through an FSA.
FSAs can cover a wide range of medical expenses, including prescription medications, doctor visits, and even certain medical procedures. However, the IRS has set specific guidelines for what qualifies as an FSA eligible item. This is to prevent individuals from using FSA funds for non-medical purposes.
One important rule to remember is that over-the-counter (OTC) medications, which were previously eligible for FSA reimbursement without a prescription, now require a prescription to be eligible. This change was implemented as part of the Affordable Care Act in 2011. However, there are some exceptions to this rule. Certain OTC items are still eligible without a prescription, such as insulin and other diabetic supplies, as well as certain first aid items like bandages, contact lens solution, and sunscreen.
Another category of FSA eligible items are medical devices. These can include items like crutches, blood pressure monitors, and heating pads. However, it is important to note that certain devices may require a prescription or a letter of medical necessity from a healthcare provider in order to be eligible for reimbursement. It is always a good idea to check with your FSA provider to determine if a particular item requires any additional documentation.
In addition to medications and medical devices, FSAs can also cover many types of medical services. This includes doctor visits, specialist consultations, and surgeries. However, elective procedures, cosmetic surgeries, and alternative therapies may not be covered. It is always best to check with your employer or FSA provider to determine which medical services are eligible for reimbursement.
Another important consideration for FSA eligible items is orthodontics and vision expenses. Orthodontic treatments, such as braces and retainers, are generally eligible expenses under an FSA. Dental care, including cleanings, fillings, and extractions, is also eligible. Vision-related expenses, such as eyeglasses, contact lenses, and certain eye surgeries, may also be covered.
Many employers also offer dependent care FSAs, which allow employees to set aside pre-tax income to cover eligible childcare expenses. These can include day camps, preschool, before and after-school care, and even daycare for adults who are unable to care for themselves. However, it is important to remember that expenses related to education, overnight camps, and babysitting for non-work-related purposes are typically not eligible for reimbursement.
It is worth noting that FSA funds are use-it-or-lose-it. This means that any funds left in the account at the end of the year may be forfeited, unless your employer offers a grace period or a rollover option. Therefore, it is important to carefully plan your FSA contributions to ensure that you do not lose any money that could have been used to cover eligible expenses.
In conclusion, FSAs are an excellent tool for individuals to save money on their healthcare expenses. By understanding what items are eligible for reimbursement, individuals can make the most of their FSA funds. From prescription medications to medical devices, doctor visits to dental care, there is a wide range of eligible expenses that can be covered. It is always a good idea to consult with your employer or FSA provider to clarify any questions or concerns regarding FSA eligible items.