As the calendar year draws to a close, it's the perfect time for employees to make the most of their Flexible Spending Accounts (FSAs) and ensure they optimize the benefits offered by this valuable workplace perk. FSAs provide a tax-advantaged way for employees to set aside funds for qualified medical expenses, and taking strategic steps before the year concludes can help them make the most of this financial resource.
- Review Your FSA Balance: Begin by assessing your current FSA balance. Many plans operate on a "use it or lose it" principle, meaning any remaining funds at the end of the year may be forfeited. Understanding the amount available allows employees to plan accordingly for eligible expenses.
- Schedule Medical Appointments: If there are pending medical or dental procedures, now is the time to schedule them. Whether it's routine check-ups, dental cleanings, or eye exams, utilizing FSA funds to cover out-of-pocket costs can help employees manage their healthcare expenses more efficiently.
- Purchase Over-the-Counter (OTC) Medications: Many over-the-counter medications are FSA-eligible without a prescription. Purchasing essentials like pain relievers, allergy medication, or first aid supplies allows employees to use their FSA funds wisely. Remember, FSA funds cannot be used to “stockpile” products, but may be used to purchase a reasonable amount that may be used within the plan year.
- Renew Prescription Medications: Use FSA funds to cover the cost of prescribed medications, including co-pays and deductibles. Employees should review prescriptions and renew those that are needed.
- Consider Vision and Dental Expenses: Eye care and dental work often incur out-of-pocket costs even with insurance coverage. Employees can leverage their FSA for expenses such as prescription eyeglasses, contact lenses, orthodontia, and other qualified dental procedures.
- Investigate Telehealth Services: The rise of telehealth services has made accessing medical care more convenient. Telehealth medical visits provide a flexible and efficient way to utilize FSA funds for medical needs.
- Smoking Cessation/Weight Loss Programs: If prescribed by a healthcare professional, FSA funds can be used for programs and medications aimed at helping individuals quit smoking or lose weight. The end of the year is a time many employees want to start self-care programs.
- Plan for the Future: Some FSAs offer a grace period or a carryover option into the next year, allowing employees to use funds beyond the traditional December 31st deadline. Understanding the specifics of your FSA plan ensures employees make informed decisions about their healthcare spending.
Taking proactive steps to use FSA funds before the year-end deadline empowers employees to maximize their benefits and enhance their financial well-being. HR professionals can support employees in this process by providing clear communication about FSA guidelines, deadlines, and eligible expenses.
Benefit Allocation Systems (BAS) provides best-in-class, online solutions for: Employee Benefits Enrollment; COBRA; Flexible Spending Accounts (FSAs); Health Reimbursement Accounts (HRAs); Leave of Absence Premium Billing (LOA); Affordable Care Act Record Keeping, Compliance & IRS Reporting (ACA); Group Insurance Premium Billing; Property & Casualty Premium Billing; and Payroll Integration.
MyEnroll360 can Integrate with any insurance carrier for enrollment eligibility management (e.g., Blue Cross, Blue Shield, Aetna, United Health Care, Kaiser, CIGNA and many others), and integrate with any payroll system for enrollment deduction management (e.g., Workday, ADP, Paylocity, PayCor, UKG, and many others).
