As I’ve mentioned before, we opted to contribute the maximum $2500 to our FSA account this year because we initially expected to pay $2000-$4500 in coinsurance for my husband’s surgery. As it turned out, we paid $0 in coinsurance, which meant we have to scramble to spend down the $2500.

Half-Year FSA Check-In
We use our FSA frequently, so I frequently check the balance and process requests for additional information. On a side note, I don’t know why they say you can use the card to pay at the doctor’s office if we ALWAYS have to send backup information and receipts. That doesn’t make it any more streamlined!

If you don’t check your FSA regularly, mid-year is a good time to check and see how much you have left to spend. Then you can start scheduling doctor’s appointments now, rather than waiting until the last month to try to fit them all in.

Our Progress
By the end of this month, we’ll have managed to spend almost exactly half of the money. That’s about $500 in prescriptions, two emergency room co-pays, miscellaneous travel/parking expenses, some over-the-counter items, and physical therapy. My husband’s preferred physical therapy center is no longer in Anthem’s network, but we opted to pay the higher co-pay rather than find a new center because we knew we had the FSA to spend down. That’s about $150 a week. (It varies. Some visits are $50, some are $25.) I’m not sure how many visits he’ll have, but twenty sessions will get us pretty close to the cap.

Planning to Exceed the FSA Limit
Given the higher PT expense, we’ll probably actually spend more on medical costs than our FSA limit. I still need new contacts and new glasses, as does my husband. He takes a few prescriptions and we still pay co-pays for those. I also have to schedule a few doctor visits for myself, so that will push us over the edge.

At first I was annoyed that we might exceed the cap and have to spend our own money, but then I remembered that the FSA is our money. It’s simple to forget that it’s ours because we don’t pay the bill for it at the end of the money, but I also always remember that we have to spend it all by 12/31/2010 or forfeit it. So, I’d rather exceed the cap and have to go out-of-pocket than leave money on the table.

It seems impossible to spend $2500 on medical care in a year, and in a normal year it might be, but even in a normal year it wouldn’t be that hard to spend $1000. It’s amazing how quickly these things add up.

Comments

5 Responses to “Mid-Year FSA Update”

  1. Meredith on June 22nd, 2010 8:21 am

    Check out HSA’s (Health Savings Account)instead, as you don’t have any annual spending cap and you can fund it with pre or post tax dollars. There is an annual contribution limit but you can keep the money in your account until you really need it.

    HSA’s are linked with High Deductible health plans. I’ve had one for 3 years now. My deductible is $2250 as a single person and I can (not required) contribute up to $3050 in 2010 – either pre-tax $, if my employer offers it or after-tax $ that can be included in my annual medical costs at tax time.

    You can contribute to your account all at once or monthly and some of the HSA providers (ck online) allow you to invest the money sitting in your HSA account.

    After growing my account for two years it came in very handy – although, like a regular savings account I would rather not have had to spend it!

  2. Aryn on June 22nd, 2010 9:31 am

    That’s great advice, Meredith. Unfortunately, my employer only offers the FSA because we have a low-deductible plan. The $2000 is the coinsurance max for major surgeries, etc. Otherwise our deductibles are $250 and $500.

  3. Amy on June 22nd, 2010 10:11 am

    I wanted to jump in and say, “I know!!” about those credit cards for the flex spending plans. I mean, if I still have to submit everything, it makes more sense for me to get the 1% back on the credit card spending then the company managing the flex spending account. I always get those cards and throw them in my credit card drawer un-activated.

  4. Aryn on June 22nd, 2010 1:12 pm

    I hadn’t thought about that, Amy. Our cards work fine at the drugstore, just not at the doctor. However, we could be earning miles for all that spending and then submit the reimbursements. Hmmm.

  5. Meredith on June 23rd, 2010 9:09 am

    Too bad your employer doesn’t offer an HSA yet as the premiums are less expensive for both the employee and employer and I really appreciate building my “health care” nest egg. I can invest my contributions and I can use my HSA “Credit Card” for all medical related payments!

    Oh,I almost forgot,as an additional benefit, some employers contribute their $ to your HSA (mine contributes $1620 annualy). Employers gain a tax advantage and Employees gain free additional money.

    Ask your HR/EB department to look into HSA’s as they are a win win for both!

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