FSA money covers medical and dental costs you pay out of pocket, but not everything
A Flexible Spending Account (FSA) lets you set aside pre-tax money for healthcare expenses, which means you pay less in taxes on that money. The catch is you can only spend it on things the IRS considers medical care — and the list is narrower than you might think. You cannot use FSA funds for gym memberships, cosmetic procedures, or over-the-counter vitamins, even though they relate to health.
The IRS publishes a specific list of what counts as a may have access to medical expense. Your employer's FSA plan document should spell out what your particular plan covers, because some employers add their own restrictions on top of the federal rules. Before you set aside money in an FSA, it helps to know exactly what you can actually spend it on.
Key Takeaways
- FSA money covers doctor visits, prescriptions, dental work, vision care, and medical equipment like crutches or hearing aids, but only expenses you pay yourself.
- Over-the-counter medicines and supplies now count as FSA-may be able to access if you have a prescription or doctor's note, but vitamins and supplements do not unless prescribed for a specific medical condition.
- Cosmetic procedures, gym memberships, and general wellness products are never FSA-may be able to access, even if they improve your health.
- Your employer's FSA plan may be more restrictive than the IRS rules, so check your plan documents or call your benefits administrator before spending.
- FSA money is use-it-or-lose-it: most plans do not let you carry unused funds to the next year, so estimate carefully what you will actually spend.
Doctor visits, prescriptions, and hospital care
FSA funds cover the cost of seeing a doctor, dentist, eye doctor, or specialist — including copays and coinsurance you owe after insurance pays its share. Prescription medications are covered, as are insulin and other drugs you inject or inhale. If you need surgery or hospital care, FSA money can pay your portion of those bills.
Mental health and therapy visits count as medical expenses, so copays for psychiatrists, psychologists, and counselors are FSA-may be able to access. The same applies to substance abuse treatment programs and rehabilitation facilities. FSA money also covers the cost of getting a prescription filled at a pharmacy, including the pharmacist's fee.
Dental and vision expenses
Dental work is one of the biggest uses of FSA money. Cleanings, fillings, root canals, crowns, orthodontia (braces), and tooth extractions all may have access to. You can use FSA funds to pay for dentures, bridges, and implants. Dental X-rays and exams are covered. If your dental insurance has a copay or deductible, FSA money can cover your share.
Vision care includes eye exams, glasses, contact lenses, and contact lens solution. Laser eye surgery (LASIK) is covered if it corrects a vision problem, though cosmetic eye procedures are not. If you wear bifocals or progressive lenses, the full cost of those frames and lenses is FSA-may be able to access.
Medical equipment and supplies
FSA money covers durable medical equipment — items a doctor prescribes that you will use repeatedly. Crutches, wheelchairs, walkers, canes, and braces all count. Hearing aids and batteries for hearing aids are FSA-may be able to access. Blood pressure monitors, glucose monitors, and thermometers may have access to. If you need a CPAP machine for sleep apnea, that is covered.
Medical supplies include bandages, gauze, tape, and other wound care items. Diabetic supplies like lancets, test strips, and syringes are covered. Incontinence products are FSA-may be able to access. Elastic bandages and compression stockings count as medical supplies if a doctor prescribes them for a specific condition.
Over-the-counter medicines and the prescription rule
The rules for over-the-counter (OTC) products changed in 2020. You can now use FSA money for OTC medicines like pain relievers, cold medicine, allergy medication, and antacids — but only if you have a prescription or written order from a doctor. A doctor does not have to examine you; they can write a prescription for an OTC item you already use.
Vitamins and supplements are generally not FSA-may be able to access, even with a prescription, unless a doctor prescribes them to treat a specific medical condition (such as vitamin D for a deficiency). Sunscreen is not covered. First aid kits are not covered unless they are part of a prescribed medical treatment plan.
What is not covered, even though it relates to health
Cosmetic procedures — including teeth whitening, Botox, hair removal, and plastic surgery — are never FSA-may be able to access, even if a doctor performs them. The exception is if the procedure corrects an injury or birth defect; reconstructive surgery after an accident or mastectomy is covered.
Gym memberships, fitness classes, and sports equipment are not covered, even if your doctor recommends exercise. Weight loss programs and diet supplements are not FSA-may be able to access. Maternity clothes, even though you need them during pregnancy, do not count. Childcare and babysitting are not medical expenses. Over-the-counter skincare products, toothpaste, and deodorant are not covered.
Travel to receive medical care — airline tickets, hotel stays, or mileage — is not FSA-may be able to access. Neither are meals or lodging during a hospital stay (though the hospital bill itself is covered). Pet medical care does not may have access to, even though pets receive veterinary treatment.
How to know what your specific plan covers
Your employer's FSA plan document is the final word on what you can spend money on. Some employers restrict FSA use beyond what the IRS allows. For example, some plans do not cover certain types of therapy or alternative medicine, even though the IRS would allow it. Your benefits administrator or HR department can tell you what your plan covers.
When you are unsure whether a specific expense qualifies, ask your FSA plan administrator or the company that runs your FSA account before you spend the money. Many FSA administrators have a customer service line and a website where you can look up whether an item is covered. Keeping receipts and documentation is important in case your FSA plan asks for proof that an expense was medical.
The use-it-or-lose-it rule and planning your contribution
Most FSA plans operate on a use-it-or-lose-it basis: money you do not spend by the end of the plan year does not roll over to the next year. Some employers offer a grace period (usually two and a half months into the next year) or let you carry over a small amount, but this is not may provide. Because of this rule, you need to estimate carefully how much medical and dental spending you will actually have in the coming year.
Look at what you spent in the past year on copays, prescriptions, dental work, and vision care. If you are planning a major dental procedure or know you will need new glasses, factor that in. It is better to contribute a little less and have leftover money in your regular account than to contribute too much and lose it.
Frequently Asked Questions
Can I use my FSA for my spouse or children?
Yes, FSA money can pay for medical expenses of your spouse and dependents, even if they are not covered under your health insurance plan. You do not have to be the one receiving the care — you just have to be the one paying for it with FSA funds.
Does my FSA cover therapy or mental health treatment?
Yes, copays and coinsurance for therapy, counseling, psychiatry, and mental health treatment are FSA-may be able to access. Substance abuse treatment and rehabilitation programs also count. Check your specific plan to see if there are any limits on the number of visits or types of providers covered.
Can I use FSA money for a massage or chiropractor?
Only if a doctor prescribes it for a specific medical condition. A massage or chiropractic visit for general wellness or relaxation is not covered. If your doctor writes an order saying you need chiropractic care to treat a back injury, that expense becomes FSA-may be able to access.
What happens if I do not spend all my FSA money by the end of the year?
In most plans, unspent money is forfeited — you lose it. Some employers offer a grace period (usually 2.5 months into the next year) or allow you to carry over up to $610 (this amount changes yearly). Check your plan documents or ask your benefits administrator what your plan allows.
Can I use my FSA debit card for anything, or only at pharmacies and doctors?
FSA debit cards are restricted to may be able to access expenses. Some cards work at pharmacies and medical providers but decline at other retailers. If you try to buy a non-may be able to access item, the card may be rejected. Always keep receipts to prove purchases were medical expenses, because your FSA plan may ask for documentation.