FSA is it worth it?

[JeffreyY]

I have never done a FSA, but it enrollment time and I am thinking about doing a health care FSA.

Here are the specifics:

There are 4 of us. (Me, DH, DD 14, DS18) We have good coverage and are pretty heathy, only pay co-pays which are $15 or $20. Usually only go for check-ups and occasional sick visits. I wear contacts, DH needs reading glasses, DH takes some meds but they only cost us about $20 a year.

I would put in $500. We should be able to spend this.
There is a $48 admin fee (I don't know if this is tax-deductible)

The calculator says I would save $125.

So is it worth the $48 fee to get the $125 but risk not spending the money in the account and losing it.

Also when it says I get $125 more, does that mean I will see it in my paycheck or I would pay that much less in taxes.

Thanks for any help you can give me to help me decide.

 

[verygfy]

The $125 is the tax savings that you would get by using the Flex account versus paying out of pocket for these expenses (figured on a 25% tax bracket). I am a huge advocate for the FSA's. When we went to WDW this past June both DD and I got sick on the trip and made 1 visit each to Urgent Care Center ($50 per person co-pay) and bought probably about $100 worth of meds. It was nice to come home and file a claim and have the $200 we spent back in my checking account. I have heard next year over the counter medications will no longer be reimbursable, I have not done the research to confirm this, but I know this is one of the ways we used the FSA.

Would I do the $500 with the $48 admin fee?? I am not sure, depends on how good you are at budgeting. It sounds like your out of pockets expenses are pretty low so budgeting for $20 here and $20 there may not be that difficult. This year DD broke her arm falling off the couch and at $50 per weekly visit for 6 weeks we went through our account pretty easily. DH and I both had dental work this year that we reimbursed (those root canals are expensive little suckers!!) and DH and DS both wear glasses that we reimbursed. DS also takes daily meds that cost $115 every 3 months. I put $1200 away this year and I am at $0 already.

I personally like the peace of mind when something does come up (and for us that seems to be annually) and not worrying about where the money is coming from. On the rare occasion that we have not spent the money towards the end of the year I usually think of things that are preventative care to apply to. One year I bought DH a pair of prescription sunglasses to use up some of the money, and went for an extra dentist visit.

HTH.

 

[cm8]

I have never done a FSA, but it enrollment time and I am thinking about doing a health care FSA.

Here are the specifics:

There are 4 of us. (Me, DH, DD 14, DS18) We have good coverage and are pretty heathy, only pay co-pays which are $15 or $20. Usually only go for check-ups and occasional sick visits. I wear contacts, DH needs reading glasses, DH takes some meds but they only cost us about $20 a year.

I would put in $500. We should be able to spend this.
There is a $48 admin fee (I don't know if this is tax-deductible)

The calculator says I would save $125.

So is it worth the $48 fee to get the $125 but risk not spending the money in the account and losing it.

Also when it says I get $125 more, does that mean I will see it in my paycheck or I would pay that much less in taxes.

Thanks for any help you can give me to help me decide.

I think it IS worth it, with the FSA, you also get to include some OTC items that are eligible, you also get to recoup your co-pays from that amount as well, to me it is worth it since you are getting your money's worth.

If you ever noticed some items that you would not think qualify as an expense that is covered by the FSA, I say go for it, you could always stock up on cold medicines and other related FSA at the end of the year if you don't use it! , We do it all the time and it really helps!

 

[cm8]

The $125 is the tax savings that you would get by using the Flex account versus paying out of pocket for these expenses (figured on a 25% tax bracket). I am a huge advocate for the FSA's. When we went to WDW this past June both DD and I got sick on the trip and made 1 visit each to Urgent Care Center ($50 per person co-pay) and bought probably about $100 worth of meds. It was nice to come home and file a claim and have the $200 we spent back in my checking account. I have heard next year over the counter medications will no longer be reimbursable, I have not done the research to confirm this, but I know this is one of the ways we used the FSA.

Would I do the $500 with the $48 admin fee?? I am not sure, depends on how good you are at budgeting. It sounds like your out of pockets expenses are pretty low so budgeting for $20 here and $20 there may not be that difficult. This year DD broke her arm falling off the couch and at $50 per weekly visit for 6 weeks we went through our account pretty easily. DH and I both had dental work this year that we reimbursed (those root canals are expensive little suckers!!) and DH and DS both wear glasses that we reimbursed. DS also takes daily meds that cost $115 every 3 months. I put $1200 away this year and I am at $0 already.

I personally like the peace of mind when something does come up (and for us that seems to be annually) and not worrying about where the money is coming from. On the rare occasion that we have not spent the money towards the end of the year I usually think of things that are preventative care to apply to. One year I bought DH a pair of prescription sunglasses to use up some of the money, and went for an extra dentist visit.

HTH.

, us too!!! OMG I guess it's time for me to do some digging!

Okay, here is what I found from the INDYSTAR...



If you have a health-care flexible spending arrangement, or FSA, commonly known as a flexible spending account, through your employer, it's about to become less flexible.



The coming change means you might want to alter your FSA contribution during this year's open-enrollment period for health benefits. New federal regulations that take effect Jan. 1 require a prescription for drugs and medications purchased with FSA money, limiting purchases you can make with untaxed money.

The same rules apply to health reimbursement arrangements, health savings accounts and the less-common Archer medical savings accounts.

That means no more purchases of over-the-counter drugs and meds -- cold and flu medications, pain relievers and allergy meds -- without a prescription.

The good news is you can still buy over-the-counter medical supplies such as crutches, medical-testing kits, joint supports, Band-Aids, contact lens solution and hearing aid batteries. Eyeglass, dental braces and insulin reimbursements also are allowed.

If you have an FSA through your employer, here's what you need to know.

FSAs are still a good deal: But remember they are a "use it or lose it." You must use the money by the end of the calendar year, though many employers extend the deadline into the next year. Otherwise, you forfeit the balance.

Re-evaluate: To decide on your 2011 FSA amount, review what you spent in 2009 and 2010 on over-the-counter drugs and medicines. If it's a big dollar amount, you might want to reduce your 2011 FSA, but most people should be fine leaving the contribution the same, said Philip Noftsinger, president of the payroll-business unit of CBIZ.

Stock up: Use FSA money to stock up on OTC drugs and medicines before Jan. 1.

Get a script: You can still buy over-the-counter medications if they're prescribed by your doctor. So ask for a script.


I'm about to head over to the IRS website and see what the deal is

 

[sookie]

I max mine out at 5k. I LOVE IT. It is usually all spent by sept or oct for us - I have two children which chronic health problems - asthma and my daughter has anaphylaxis. My husband has been a train wreck the past two years too, so its GONE and its so worth it. Our tax advisor told us to keep on doing it because it was saving us so much money!!
I also do dependent care FSA too -max it out at 5k too because I have two kids in daycare. I get the money right back as soon as it goes into my account. SO WORTH IT.

 

[amylynne01]

We have one also and it is great especially for things we have such little coverage on, like vision and dental. We both wear reading glasses and need dental work, so we can use our pretax dollars to pay for those services. We have a mastercard attached to our FSA, so we do not have to submit a claim and get reimbursed. I have used the card at CVS and Rite Aid, and the register automatically charges my FSA with all applicable items. Then I can pay for the rest using my regular checking account.

 

[sookie]

well, thank obama for the FSA changes. i'm not happy about them either. I was hoping they would get overturned but they have not.

 

[kellia]

Yes, we've gotten letters from my and dh's employers about no OTC next year. Darn!

For us, it's worth it. We have a deductible, so I do that plus everyone's monthly medicine co pays. (Allergies here). I also add in vision and dental expenses. It is nice to have the money that you set for whole the year available for reimbursement Jan if you have a big expense. This year we had 2 wisdom teeth pulled, I had an unexpected crown and root canal, dd had to go to the er by ambulence, and a few other things, so we used ours up by March, though.

Flex account through my work is great, they give you a debit card. Dh's is a PITA, you have to submit and takes forever to get a check back. We don't go through them anymore! We've had a flex acct for 15 years and never had a fee, though. I did have one for my HSA account (only for those with high deductibles).

 

[Green Tea]

I just can't imagine my world where we only would put $500 in! Contacts, contact solutions, the copays for the doctor, eye exams, reading glasses, braces for the kids.

 

[cm8]

Yes, we've gotten letters from my and dh's employers about no OTC next year. Darn!

For us, it's worth it. We have a deductible, so I do that plus everyone's monthly medicine co pays. (Allergies here). I also add in vision and dental expenses. It is nice to have the money that you set for whole the year available for reimbursement Jan if you have a big expense. This year we had 2 wisdom teeth pulled, I had an unexpected crown and root canal, dd had to go to the er by ambulence, and a few other things, so we used ours up by March, though.

Flex account through my work is great, they give you a debit card. Dh's is a PITA, you have to submit and takes forever to get a check back. We don't go through them anymore! We've had a flex acct for 15 years and never had a fee, though. I did have one for my HSA account (only for those with high deductibles).

well, I did some more digging and it is NOT going away per-se, you will now have to get a PRESCRIPTION in order to get credit for some of the OTC medicines, the other things are still available.......

 

[smokeyblue]

I'm single and put about $400 in for this year. It's kinda a PITA! I wish we had debit cards. I have to fill out a lousy form and it is an online form that you fill in and print. It is totally obnoxious! Then I have to photocopy every little receipt I have and of course they aren't all the same size so it's a bit of work. I've been hasseled multiple times about my reeipts not being strong enough proof that I paid. I had to make lots of long distance phone calls to them and argue my case.

I've decided not to do it again next year. I think I figured out I'd save around $70 as it is. If you were putting out lots of money I'd highly suggest it. My boyfriend is a diabetic, and he is a higher tax bracket than me so his savings are significant.

It is a shame however that they are not going to allow OTC's. Working in healthcare I can't tell you how many visits can be avoided by taking OTC's. They are one of the most cost-effective components of healthcare out there!

 

[JeffreyY]

Thanks for the responses.

What I'm not sure about is the $48 fee. That is about 10% of what I want to do. If I was doing $5000 it would make sense but at $500 I'm not sure. And I would have to fill out forms and submit receipts.

I may try it for this year and see how it works out.

 

[kaseyC]

I have always loved ours especially having a debit card attached to the account. We have adjusted the amounts through out the years.

My Dh's company changed providers this year from ADP to AON and I have been very unhappy with AON. They have made the whole process of reimbursement more difficult.

 

[Ava]

I've been doing a healthcare FSA for a few years now and really like it. It's nice to have that money set aside for healthcare expenses & not have to worry about it when a bill comes. Although this year I only put in $1000, thinking we wouldn't have many expenses, then I had to have some dental work done & have just about used it up with still a few more doctor visits for the year left to go! I think I will put in more for next year, even with the OTC meds going away. I wear disposable contact lenses so if push comes to shove & I have to use up money at the end of the year I can just order some more contacts.

ETA: I have a debit card attached to mine so it's really convenient. Sometimes I have to send in a receipt, if what I've purchased isn't clear from the information they get from the debit transaction, but most of the time I don't even have to submit any receipts.

 

[tr-ray]

My husband and I participate every year. We are upset though that we will not be able to do OTC's anymore. Although, if we do get a script, that will be nice -- my DH takes Claritin/loratidine(sp?) daily for his allergies.

It works out great for us because we both wear glasses and have had a good amount of dental work this year -- we're all out already.

I think we did $500 on one, $750 on the other.

Luckily our company goes through Sentinel so we get a "Benny Card" that we can use at the point of sale.

 

[LisaNJ25]

I love it. We did I believe 600 the first year and last year went to $1000. I just got the paperwork and may go higher this year. I still owe on DD's braces and I need a root canal and hubby some dental work.

I look at it as prepaying over the year and not worrying about coming up with a large chunk. I also like how all your money is available January 1st


We have the debit card also which worked out great. I dont use if for the drs co-pays since they dont take credit cards.

 

[patsal]

The plan goes back to the way it worked like 10 years ago. 10 years ago you needed a script for every OTC as well. It is a pain, but not that big a deal, heck my glasses alone are $395 after all insurance is pulled out. I use it between $20 copays for specialists, $15 copays for reg Dr., Drug copays, I use it all lup plus. This year I opted for $1000, but my employer deposits $1200 into an HSA so I have that to fall back on if I need to.

 

[ksloane]

We have one and I LOVE it.....I have only had one year where I had anything left right before the deadline so I ordered a box of contacts and that finished it out!

 

[herdtoDisney]

This is actually the first year I've ever used the FSA and I'm sold! Dh and I put in $1200 and we don't miss the $ out of his check! It's painless. We have already used it-I wanted to be very conservative. I might put in more for next year. We don't have access to dental insurance and my ds' asthma scrips is expensive on Blue Cross Basic. That's where it went.

I have the debit card-Walmart takes it so I use it for scrips and it's so easy. The dental stuff I have to submit, but I get the check in a couple weeks.

 

[MyDizneyBoyz]

The plan goes back to the way it worked like 10 years ago. 10 years ago you needed a script for every OTC as well. It is a pain, but not that big a deal, heck my glasses alone are $395 after all insurance is pulled out. I use it between $20 copays for specialists, $15 copays for reg Dr., Drug copays, I use it all lup plus. This year I opted for $1000, but my employer deposits $1200 into an HSA so I have that to fall back on if I need to.

I'm reviewing our options now as DH's company has changed insurance plans and this caught my eye - do you have both an HSA and an FSA? I thought you couldn't have both as the IRS said that's a no-no. DH's employer is really pushing the "health plan + HSA" but if we changed to that one, I would no longer be allowed to use my company's FSA (even as the spouse and at a different company entirely!) as you can't have both within the family... but then the HSA thing is new to me so there's a good chance I'm reading something wrong. But I was wondering!