Once again, the holidays have snuck up on me. It happens every year – the calendar flips to November and bam – I’m hit with toy catalogues and holiday commercials. While you’re making your list and checking it twice, pencil in some time to think about your flexible spending account (FSA).
FSAs are valuable, tax-saving tools that can be used to pay for medical and health-related expenses, but if the money you have put into the account is not used by December 31, you may lose it. Even if your FSA is set up to allow a $500 carryover or an extended grace period (log in and check your FSA plan specifics to find out), now’s the time to take a look at your balance, figure out how to use it, and plan for the year ahead.
Over the years, the IRS has added many items to the list of qualified expenses – some you may not even know about. So if you need some creative ideas for how to spend your FSA money, we can help you get started. Please remember: The suggestions below are commonly accepted as qualified expenses for general purpose FSAs. If you have a limited purpose FSA, your list of eligible expenses may be more restricted. Check your FSA plan specifics for exclusions and coverage.
- Oh, baby!
If you’re thinking about having a child – or if you’ve recently given birth – there are a host of items you can purchase or stock up on to use up your FSA dollars, including:
- Ovulation monitors
- Pregnancy tests
- Breastfeeding classes
- Breast pumps (one is covered under your health plan, but you can use your FSA money to purchase a second to keep at the office. I highly recommend this – dragging a pump back and forth is a pain!)
- Lactation supplies (bottles and bottle nipples, cleaning wipes, breast milk storage bags, etc.)
- Lactation consultant services
- Getting around
Did you know that you can reimburse yourself $0.17 per mile for the cost of driving yourself or a dependent to and from eligible medical, dental, and vision appointments? This is a fairly recent change that also applies to bus, train, taxi, and parking expenses for eligible care. Save those receipts!
Though not for everyone, if you’ve been considering trying acupuncture, why not do so with the FSA funds you have to use up? Acupuncture is believed to help headaches, low back pain, neck pain, and more. It can also relieve discomfort associated with chemotherapy, menstrual cramps, and labor pain.
- Live video doctor visits
If you use Doctor On Demand, our telemedicine provider, you can pay for any expenses incurred for that visit with your FSA money. Doctor On Demand is a convenient alternative to urgent care or the emergency room for situations that are not life-threatening, such as pink eye, rashes, sprains, the flu, and more. And don’t forget, Doctor On Demand also offers access to mental health providers.
- Cold and flu season prep
Hopefully you’ve gotten your flu shot by now, but it’s always best to be prepared for it or a cold as we head into a long stretch of winter. You can purchase humidifiers, thermometers, and disposable masks to prevent or treat illnesses for yourself and your family.
- Healthy smiles
If your community water source contains low or no fluoride, getting a fluoridation treatment for yourself or your dependents could help reduce tooth decay by as much as 25 percent. For those of you out there who grind your teeth, consider asking your dentist about an occlusal guard to prevent doing so while you sleep – also a covered expense.
- Heading to a warmer climate?
Use your FSA money to purchase sunscreen SPF 15 or higher that you will most definitely need! Have a child in daycare or that goes to camp in the summer? Stock up on any sunscreen that might still be on clearance shelves in your local stores to send with them once the weather gets nicer again.
- Start your New Year’s resolution early.
There’s no time like the present to kick a super unhealthy habit. Smoking cessation programs are eligible for reimbursement under your FSA.
Start Planning for Next Year
As more and more companies switch to offering high deductible health plans, it’s important to understand which funding accounts pair with these plans. If you are considering or have enrolled in a high deductible health plan for next year, please keep the following in mind:
- If you have a traditional, general-purpose health FSA you are ineligible to establish a health savings account (HSA). If you wish to open an HSA, you will also want to be absolutely sure the balance in your current FSA account is $0 by the end of your plan year.
- If you have a health reimbursement arrangement (HRA), you can participate in a health FSA.
If you have a large amount of FSA money that you’re trying to spend as the year ends, it doesn’t mean an FSA isn’t right for you. It simply means you may need to take a closer look at your health expense estimates for the year. Consider refining your annual contribution based on purchases you made throughout the year and any expenses you know are coming up next year.
FSAs are an important part of your overall health plan package – and knowing how to use the funds you contribute is equally important. We hope these practical (and healthy!) tips will allow you to take advantage of your FSA money before the year ends.
Bonus tip! If your health plan includes Life Points®, you’ll also want to log in to cash those out before the end of the year. Life Points is a calendar year program and points reset on January 1, regardless of when your medical benefits renew. Points must be redeemed no later than 8 p.m. on December 31. CDPHP encourages you to use your points toward the purchase of health and wellness-related items.