The end of the year means a lot of things. Holidays, often a lot of snow, and a time to reflect on the past year and plan for the next one.
But there’s something else you should do this time of year. If you have an FSA or an HSA, it’s time to review what it can cover and how much money you have in it. This is really important for people with an FSA (Flexible Spending Account) through their employer. FSAs are a way to sock away money to pay for health expenses, but they come with a major catch. If you don’t spend what you deposit by the end of the year, that money may be forfeited! In certain cases, $500 can be rolled over or you can have 90 days after the end of the year to spend the money, but it depends on your plan.
HSAs are controlled by employees and are often linked to high deductible insurance plans. These plans give individuals much more control over their money, but the attached plans may cover less than you expect compared to a plan linked to an FSA.
Before you spend the money, it’s important to know what your attached insurance plan will or will not cover. You might have the money in your account to cover something but discover later that the insurance company won’t help you with the payment. What often happens is that the individual and the insurance company will have to work it out between themselves to get a decision.
That’s the case with the mySugr Bundle, which is a cash purchase. You’d have to work directly with your plan provider to figure out whether it’s a covered expense, and if so, what their process is to receive the benefit.
Fortunately, there are quite a lot of things you can purchase through your FSA account before the money is forfeited. Your FSA plan may even have a special store that lets you spend the money on a wide variety of medical supplies. Additionally, FSA money can be spent on dental and vision expenses, including copays and coinsurance. FSA money can also cover, among other things:
- Travel expenses for medical needs
- Alternative medicine like chiropractic and acupuncture
- Mental health treatments
- Costs of a service animal
- Family planning
Now is the time to decide how you’re going to spend any money you’re going to lose and re-examine your contribution amounts from your FSA or HSA for next year. You’ll give yourself the gift of continued medical care and help you save a little extra money for other gifts for you and your family.