FSA/HSA: Frequently Asked Questions


What is an FSA?

Many employers offer an FSA. Flexible spending account, as FSA stands for, is a common benefit for full-time employees. With this account, you designate a certain amount of your salary to the account at the beginning of the year, usually up to around $5,000. The money comes out of your salary up front, pre-tax, and you pay it back in payroll deductions the rest of the year.

This type of account can be used to pay medical expenses that health insurance normally doesn't cover. It is typically given to employees on a dedicated debit card for that use, though some employers still use a reimbursement method. There are certain things that aren't covered, such as cosmetic surgery and fertility treatments beyond testing. You will be provided with a list of what you can use your FSA funds to buy.

Typically approved expenses include optometry, dentistry, co-pays, over-the-counter medicines and medical supplies (such as contact lens solution), and more. The important thing to remember with an FSA is that you must use it all by the end of the year, or you will lose the money you put into it. Funds do not roll over.

What is an HSA?

Unlike FSA accounts, which are owned and operated by an employer, Health Savings Accounts, or HSAs, are owned and operated by individuals. This makes them perfect for the self-employed, owners of very small businesses, and those whose employers offer inadequate health insurance and no FSAs.

The funds deposited into an HSA are not subject to income tax at the time of deposit, and, unlike FSAs, the funds do roll over each year, so owners do not have to spend all the funds in the account on an annual basis.

To establish an HSA, you must have a high-deductible health insurance plan that has an HSA-eligible provision. Your employer may make contributions to this plan as a company benefit, but you are the owner of the funds and can make your own contributions, as well. The annual contribution limits for these accounts are similar to FSAs, with slightly higher contribution limits for married people.

HSA plans pay for most of the same things FSAs pay for, with the exception of over-the-counter medications. These were recently abolished from the federal list of approved HSA expenses, though HSA funds may still be used to purchase them if a doctor has written a prescription for them (though no prescription is required for over-the-counter medications).

Like FSAs, you can use your HSA account for optometry, ophthalmology, dental, and co-pay expenses, and more.

Learn More about FSA and HSA by Contacting Our Optometrist Today

Contact us at our Katy office at (281) 644-2010 or our Houston office (713) 984-9144 to make an appointment to use your FSA or HSA funds for an eye exam, contact lenses, new eyeglasses (including lenses and frames), contact lens solution, LASIK consultation, and more. You can use your funds for most of our services, and we are glad to welcome you to our practice.

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