5 ways to help employees maximize FSA dollars
If your employer-sponsored Flexible Spending Account (FSA) has a grace period, employees have until March 15 (for plans that ended Dec. 31) to spend FSA dollars from 2015. That’s good news, but did you know that many employees that many employees do not understand or know about the deadline? Research shows employers could be doing more to educate them; here are five tips from FSAstore.com that you can use to help employees understand and maximize their FSA.
Know what’s eligible
Smartphone enabled blood pressure monitors and home defibrillators are eligible FSA expenses, but what about baby monitors or medical tapes? There are more than 4,000 FSA-eligible products, and that list has grown and changed over time. Avoid keeping print copies of outdated list and refer employees to online eligibility lists such as the comprehensive FSA eligibility list.
And what isn’t eligible?
Not all products at your local drug store are FSA eligible expenses, but chances are the sales clerk or pharmacist won’t know it. Common products that aren’t eligible include electronic toothbrushes, cosmetics, weight loss products and fitness trackers. Over the counter medications including Tylenol or Advil are eligible, however with a prescription.
Get everyday healthcare items.
Employees can spend down their FSA by purchasing everyday things like broad spectrum, SPF 15+ sunscreen protection or contacts and contact lens solution. This may not make for exciting purchases, but it beats forfeiting unused dollars. And why-not use pre-tax dollars on medical essentials that you’ll purchase anyways? Employees also may not realize they can use their FSA to pay for expenses for their adult (through age 26). Parents can even get a FSA debit card for dependents, so if they have a child in college, they can ensure they stay healthy while away at school.
Remind employee to think ahead and buy products for the coming months (think spring break trips or summer vacations). But beware! Buying to much of one product at once may be considered “stockpiling,” which is not allowed. Employees can also benefit from shopping for bundles of similarly themed products (i.e. baby care, pain relief, adventure travel) available at FSAstore.com.
Use your FSA debit card.
Help your employees save time and paperwork by offering an FSA debit card and encouraging them to use their debit card when spending FSA dollars. When employees use their debit card, money is taking directly out of the FSA, eliminating the need to file a paper claim and wait for reimbursement. FSA debit cards can be used for all things medical such as copay’s co-insurance and deductibles, as well as vision, dental and over-the counter medical items, too.