Flexible Spending Accounts
Setting the Foundation for a Lifetime of Healthy Smiles
Many employers now provide a flexible spending account (FSA) as a benefit for their employees. With an FSA, you can allocate a portion of your paycheck to cover various out-of-pocket health care expenses, such as dental treatments.
Cedar Grove Dental Group in Cedar Grove and the surrounding area is happy to accept FSAs. Our team will coordinate with your employer to ensure coverage. If you have any questions about using your FSA, we are here to assist you. Don't let your FSA funds go to waste - contact us at (973) 857-0567 to maximize your benefits.
How FSAs Work
Flexible Spending Accounts (FSAs) can help fill the gaps left by other health insurance plans by allowing employees to use tax-free funds for out-of-pocket health care expenses. FSAs may even replace a traditional employer health insurance plan or supplement a marketplace plan. Employees contribute a set amount of money to their FSA each year, which is deducted from their paycheck before taxes. These funds can be used for approved health care expenses such as deductibles, copayments, coinsurance, prescription drugs, over-the-counter medications, and medical devices like crutches. Employees have one year to use their FSA funds before they expire.
“FSA can help bridge the gap left by other health insurance plans.”
The advantages and disadvantages of an FSA
Tax savings represent the main benefit of an FSA. Since the funds are removed before taxes, employees have a lower taxable income. Some employees find that an FSA increases their take-home pay. The funds in an FSA are available at all times, with few restrictions. Most FSAs are linked to a debit card for added convenience. Patients can then use their FSA debit card at their doctor, dentist, or pharmacy. Patients usually do not need pre-approval or to do other paperwork.
However, employees can only contribute a certain amount of money each year. For most employees, the limit is $2,750 per year. Spouses can also contribute an equal amount to their own FSA. Additionally, FSA funds are tied to an employer. If an employee changes jobs, they cannot keep their current FSA
FSAs funds are "use it or lose it." At the end of the year, employees can roll over up to $500. The remaining unused funds are forfeited to the employer. Employees must keep an eye on their FSA balance. It's up to each patient to ensure that they use their funds before they expire.
Many patients confuse FSAs with health savings accounts (HSAs). These programs are similar, but they have a few key differences. With an FSA, employees can use their funds as a line of credit. With HSAs, employees can only spend money they have already saved. HSAs are also transferrable: employees can keep their HSAs if they change jobs.
“The funds in an FSA are available at all times, with few restrictions.”
Ways to Save Money Using an FSA
Employees can take advantage of a Flexible Spending Account (FSA) by setting aside a portion of their paycheck. Enrollment for an FSA is typically offered for a limited time at most workplaces. Employers can provide more information on how and when to sign up for an FSA.
During the enrollment period, employees must decide on the amount of money they want to save in their FSA. It's important to carefully consider this decision, as underestimating could result in missed tax savings, while overestimating could lead to losing the funds. The appropriate amount to save will vary based on each individual's family circumstances.
Once enrolled, funds are deducted from each paycheck, and employees have until March 15 of the following year to utilize their funds. It's crucial to remember that any unused funds will expire, so it is the employee's responsibility to use them before the deadline.
“One’s employer can provide more details about where, when, and how to sign up for an FSA.”
How to Use FSA Funds
Patients are able to utilize their FSA for many dental expenses, such as routine care, but not all procedures are eligible. It is recommended that patients consult with their employer and plan provider before scheduling a dental procedure. Cosmetic procedures, like cosmetic orthodontics, are typically not covered by an FSA. However, if orthodontic treatment is medically necessary, patients may be able to use their FSA funds. Our dental team is available to assist in determining coverage with your plan provider.
“Cosmetic procedures, including cosmetic orthodontics, are usually not covered under an FSA.”
Which Treatments and Procedures Qualify
FSAs cover a wide range of dental services, including:
- Routine cleanings
- Filling, sealants, and extractions
- Diagnostic and preventive care
- Gum disease treatment
- Oral surgery
- Crowns, bridges, and dentures
Employees are also able to utilize their FSA funds for additional health care expenses, including:
- Prescription medications
- Medical and diagnostic devices
- Over-the-counter medications (with a doctor’s prescription)
- Copays
- Deductibles
- Coinsurance
- Eyeglasses
- Eye surgery
- Hearing aids
- Hospital expenses
Most preventive and diagnostic procedures can be covered by FSA funds, but there may be some exclusions. For more information on specific rules and exemptions, individuals can contact their employer or plan provider.
