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My Magical FSA Card

This is the first year that I’ve ever signed up for an FSA (Flexible Savings Account) through my employer. The FSA is a use it or lose it type of account, so at the beginning of the year I have to determine how much money to set aside for medical expenses and hope by the end of the year that I’ve used each and every penny.

This year I decided to take a stab in the dark and estimate a year’s worth of medical expenses. To be honest I still have no idea if I selected the right number, but I figured I should try it at least once.

I received my FSA debit card in December and used it for the first time in January. I am absolutely in love with it. I swipe the card at my doctor’s office and pharmacy and just like that my medical expenses are paid with tax free dollars.

I can log in at any time to see how much money I’ve spent and how much I have left in the account. The website for my FSA lists all of my transactions and lets me know exactly how my medical expenses are adding up.

Every once in awhile I pay for something with the FSA card that requires further documentation. Tonight I uploaded a series of receipts for medical transactions that required detailed receipts. All of this can be done online and once I’m finished I can also track the status of my submission.

Unfortunately, I have a lot of medical expenses that are not permitted through the FSA. I seek weekly treatments from a massage therapist, but I cannot pay with my FSA card without a doctor’s prescription stating that the massage is a medical necessity.

While it certainly is a medical necessity I got tired of waiting for hours in my primary care physician’s office for a note stating that fact. So now I pay those expenses directly out of pocket and they really add up. I pay over $300 a month just to my massage therapist.

I wish it was easier to pay for alternative medical treatment through the FSA. I hope that this changes over time. I also hope that the government changes it’s policies and permits the purchase of non-prescription drugs through the FSA program again.

I’m still concerned that I put aside too much money this year, but I won’t really know for sure until the year ends. I may have completely different feelings about my account if lose money at the end of the year.


Wednesday 16th of March 2011

I'm a huge fan of FSAs and never seem to have trouble spending it all. The rules regarding OTC meds have changed this year, so It won't be quite as easy to burn up the balance the last week of December as it has been in the past. Hint: If you wear glasses, you can pick up a spare pair or buy more contacts.

Here's a key point regarding FSAs: They are front loaded. The entire amount you choose to have withheld is available to you on January 1. For example, should you use it all up by March 1 and then leave the company on June 1, you do not have to repay the money, even if you've spent more than you had withheld. That's the flip side of "use it or lose it" which pfstock mentioned.

One Frugal Girl

Thursday 3rd of March 2011

@graduatedlearning - The OTC change really stinks, but I think you can purchase other things like heating pads, thermometers, etc.

@pfstock - I did consider that. It was one of my concerns, especially since my current work environment is a little bit dicey.


Wednesday 2nd of March 2011

My usual comment about FSA plans concerns the "use or lose it" provision. My experience is that if you are terminated without cause (i.e., laid off), any money that you have left in your FSA plan will be kept by your former employer.

This also applies if you voluntarily leave your job during the year. So, I was curious if you took that factor into account when you decided how much to contribute?


Wednesday 23rd of February 2011

I think I may have over-estimated how much I was going to spend on health expenses. Plus I didn't realize they had changed one of the rules for OTC now need a prescription in order to be reimbursed for OTC meds. But I'll try to find a way to spend it.

Ruby Leigh

Wednesday 23rd of February 2011

A friend of mind had too much money in her FSA account at the end of the year, so she made a trip to Target and stocked up on bandaids and ibprofen. Just a thought.