FSA: Use it or lose it!

Flexible Spending Accounts (FSA) are like a discount on out-of-pocket healthcare expenses… including massage therapy! If you get regular massage and you’re not using your work-sponsored FSA plan (currently $2500 per year), you’re missing out on savings!

How to use your FSA

To use your FSA plan, all you need is a prescription from your doctor to receive massage therapy to treat a specific diagnosed condition (you need a diagnosis code). Only your doctor can give you a diagnosis. FSA plans are pretty strict about substantiation – meaning they’ll ask you for proof regarding your expenditures. Providing substantiation is easy:

  1. When you visit us, you’ll use your FSA card as payment and we’ll provide you a receipt with the necessary information.
  2. When asked by your FSA plan, provide them the prescription and receipt.
  3. That’s it!

FAQs about FSA

  1. How much of a discount is it?
    Because FSA money is “pre-tax” dollars, it will reduce your taxable income and give you a “discount” equal to your tax rate – so a 20% tax bracket means a 20% savings. If you’re at the highest 39% tax bracket, you’ll save a whopping 39% on your muscle care (that’s $975 per year in savings alone)!
  2. How do I get an FSA?
    FSA plans are typically provided through employee benefits and you can sign up for one during your open-enrollment period.
  3. What does the “use it or lose it” aspect mean?
    FSA money is set aside on an annual basis and is limited to the tax year it is applied to. It can be tricky to estimate out-of-pocket healthcare expenses, but if the money is not spent during the given time-frame, you lose it!
  4. How long do I have to spend my FSA money?
    The good news is that you have more than one year to use it. Even though it is reserved for a given year, the tax year extends all the way to April of the following year – about 16 months total.
  5. How much should I put on my FSA plan?
    It entirely depends on your healthcare expenses, but we’d recommend estimating how many massages you will receive in the given year and putting at least that much on your card. If you get a massage a month, add $1000-1500 to your other anticipated healthcare expenses like copays and prescriptions. If you use your FSA for massage and spend at least $1000 on other healthcare expenses, it’s a good idea to max out your FSA.
  6. How is FSA different than HSA?
    A Health Savings Account (HSA) is similar to an FSA, but has some big differences.

    1. Any money assigned to your FSA is available on January 1st… yes, the whole thing! Then the money is “paid back” through paycheck withholding over the entire year. It’s almost like a loan. With an HSA, the only money available is what you’ve already deposited, more like a traditional bank account.
    2. HSAs are only available to those who have a high-deductible health plan while FSAs are available with any type of insurance plan if your employer offers it.
    3. FSA plans are more strict about substantiation.
    4. HSA plans have higher limits than FSA plans do.
    5. HSA funds are not lost or need to be spent before the tax year ends.