Save with Your HSA/FSA on Your Next Purchase!

Health Savings Accounts (HSA) and Flexible Spending Accounts (FSA) are tax-free accounts that can be used to pay for qualified health expenses. These accounts are usually set up and managed by an HSA or FSA administrator, and you should have access to said HSA/FSA administrator through your employer (ask your HR department!). HSAs are typically associated with a high-deductible health plan, and funds do not expire. FSAs are independent of your health plan, and funds elections occur in October-November each year for the following calendar year. FSA funds expire every calendar year. Unfortunately, HSAs and FSAs are not available outside of the US, and self-employed individuals (who do not have an HSA from a previous employment) do not qualify for HSAs or FSAs.

HSA/FSA accounts were created so individuals could use pre-tax money to pay for expenses used to treat, mitigate, or prevent a diagnosed medical condition. Because HSA/FSAs use pre-tax money, you’re getting more purchasing power for your dollars. Rather than pay taxes on income and then spend it on health items, qualified customers can use pre-tax funds to invest in their health. An individual can contribute up to $3,850 pretax to their HSA per year, or $7,750 for a family (plus an additional $1,000 if you are at least 55 years old Individuals can contribute up to $3,050 pretax to their FSA per year (with an additional $500 in employer contributions allowed). Almost every qualified individual will save between $1,000 and $2,000, depending on their state and tax rate.

In order to determine whether certain products or services are legitimate expenses for treating, mitigating, or preventing a diagnosed medical condition, HSA/FSA plan administrators often require a letter from a licensed practitioner. This letter is called a “Letter of Medical Necessity.”

Each Letter is valid for 12 months before it needs to be renewed.