Healthy Living

Make the most of your HSA or FSA

21 November 2023

Medical expenses and your insurance plan might not be at the top of your list this holiday season, but for some types of accounts you have to “use it or lose it” by the end of the year. Read on to learn about Health Savings Accounts (HSA), Flexible Spending Accounts (FSA) and all you need to know to make sure you’re not leaving money on the table as the year winds down.

HSA and FSA – What’s the difference?


HSAs and FSAs are savings accounts that can save you dollars on health-related expenses throughout the calendar year. Both HSAs and FSAs allow you to set aside pre-tax funds to cover these health expenses, but there are key differences you should be aware of.

An FSA is independent of your insurance plan and you have a limited amount of time to spend the funds in your account. Often, the dollars must be spent by the end of the calendar year (some exceptions and grace periods apply so check with your employer).

HSAs are only open to people with high-deductible health plans. However, they can be added to overtime, don’t expire and can be invested. If you switch jobs (or insurance plans), you can also take the dollars you’ve set aside in an HSA with you (although you can’t continue to make contributions in the same account).


How can you use HSAs and FSAs?


You can use your HSA and FSA account to cover co-pays and other bills from your healthcare provider, but be careful, not every visit (like cosmetic procedures) can be paid for from your health savings or flexible spending account. 

Additionally, many health-related items are eligible to buy using HSA and FSA dollars including some you might not have thought of before: sunscreen, contact solution, glasses, tampons and more! However, be careful not to buy too many of the same products, as the IRS doesn’t allow FSAs to be used for stockpiling. (The IRS doesn’t define how many products would qualify as stockpiling, although it does say that the accounts are meant for medical care used in the current year—not a future year.) 

See a list of great ways to spend your FSA.

Even though your FSA dollars run out at the end of the year, there’s still time to look over your healthcare-related bills and submit them for reimbursement, or to schedule a doctor’s appointment for December. As long as these expenses were incurred in 2023 and qualify, your Flexible Savings Account should cover them.

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