Teresa McUsic

Have money left in a healthcare account? Here’s how to use it

Flexible Spending Accounts and Health Savings Accounts can help cut down on out-of-pocket medical expenses.
Flexible Spending Accounts and Health Savings Accounts can help cut down on out-of-pocket medical expenses. TNS

Panicked to get your Flexible Spending Account (FSA) emptied out by the end of the year end, but can’t remember exactly what qualifies?

Could you use big discount — as high as 30 percent — on healthcare items like a blood pressure monitor, steam inhaler or bandages?

Online tools can help with both.

Around 25,000 health-related products can be purchased with a Flexible Spending Account or Health Savings Account.

Both FSAs and HSAs allow you to save money by putting a set amount in an account from what you earn before taxes are taken out. The accounts can be used on everything from orthodontics and chiropractors to deductibles and co-pays.

And you can use them for healthcare products. Check with your plan, but if you have an FSA with a Dec. 31 deadline, now is the time to use up whatever is remaining in the account or you may lose it.

Year-end deadlines on accounts are becoming less common. Many FSA plans now have an extension to March 15 of the following year, or the ability to roll over $500 to the next year. Again, check with your company about the specific rules for your plan. HSAs have no year-end “use-it-or-lose-it” requirement, so leftover amounts roll over automatically each year indefinitely.

If you need to shop now, retailers like CVS and Walgreens identify products that are FSA/HSA eligible in their store and on their websites.

But one online retailer streamlines this by specializing only in products in compliance with the IRS and healthcare laws that govern these accounts. These online stores can be found at www.FSAStore.com and www.HSAStore.com.

“We see a spike in people who come to the site at the end of the year,” said Jeremy Miller, founder and president of both online stores. “There is still a lot of last-minute shopping.”

Both online stores offer a number of services, Miller said.

▪ Need a prescription? The Affordable Care Act requires any healthcare product with an “active medical ingredient” to have a doctor’s prescription before it can be purchased using an FSA or HSA.

This includes common over-the-counter products like pain relievers, cough and flu medication and antacids. The FSA and HSA Stores label each product with a notice of whether or not a prescription is required before purchase.

▪ Fill out a request form with your name and your doctor’s name and the online stores will send a prescription request to your doctor on your behalf for free.

Miller said around 80 percent of doctors respond to the request with a prescription, enabling the customer to buy the product with the paperwork attached. (Note: This service stops one week before the end of each year at the FSA store to avoid missing a Dec. 31 deadline.)

▪ Bundle your buys. If you have a certain amount and don’t want to do a lot of shopping, look at one of the bundles offered at the FSA store.

Costs range from $34.99 for a kids health bundle, including sunscreen, saline nose wipes and sea band wristbands, to $999.99 for a blockbuster bundle that has a steam inhaler, foot circulator, acne treatment system and comprehensive first aid kit, among other items.

Miller said that many people with an FSA or HSA account are not aware of some items that can be purchased. For example, a list of eligible items includes high-cost products such as a defibrillator or blood pressure monitor to inexpensive things such as sunscreen and condoms.

FSAs are more than 30 years old, yet only one in five employees who have access to the benefit through their company set them up, according to a study by VISA. Miller said around 30 million Americans have FSA accounts.

HSAs began in 2003 and are becoming more popular. Tied to a high-deductible insurance policy, HSA accounts grew to 14.5 million in 2015 — a 23 percent rise over the year before — holding more than $28.4 billion in assets, according to research firm Devenir.

As healthcare costs continue to rise, these accounts are becoming more valuable as a tool to rein in out-of-pocket medical costs.

Teresa McUsic’s column appears Saturdays. TMcUsic@SavvyConsumer.net

FSA/HSA rules

The IRS requires you verify FSA and HSA expenses. Save receipts for each eligible expense you submit for reimbursement and make sure they include the following information:

1. Patient’s name: The name of the person who received the service or for whom the item was purchased. You do not need this for retail store purchases.

2. Provider’s name: The provider that delivered the service or the merchant where the item was purchased.

3. Date of service.

4. Type of service: A detailed description of the service provided or item purchased. A bag tag can be used for prescriptions.

5. Cost: The amount paid for the service or product and/or the portion that is not reimbursed through your insurance carrier.

Source: Wageworks