FSA money covers medical and dental costs you pay out of your own pocket
A Flexible Spending Account (FSA) lets you use pre-tax dollars to pay for certain healthcare expenses. The money comes from your paycheck before taxes are taken out, which lowers your taxable income for the year. You can spend FSA funds on copays, deductibles, prescription drugs, dental work, vision care, and medical equipment — but not on insurance premiums or over-the-counter items without a prescription.
The key limitation is that FSA money must be used for expenses you incur during the plan year. Most plans run January through December. Money you don't spend by the end of the year is forfeited — there is no rollover to the next year (with rare exceptions for dependent care FSAs). This means you need to estimate carefully how much to contribute.
Key Takeaways
- FSA funds pay for copays, coinsurance, deductibles, prescription medications, dental procedures, and vision care — but only if you have a medical reason and a provider's order.
- Over-the-counter items like pain relievers, cold medicine, and bandages are not covered unless your doctor writes a prescription for them.
- You cannot use FSA money for health insurance premiums, gym memberships, cosmetic procedures, or general wellness products.
- Any FSA money you don't spend by the end of the plan year is lost; you cannot carry it forward to the next year.
- You must keep receipts and documentation to prove expenses are FSA-may be able to access if your plan administrator requests them.
Medical expenses FSA covers
FSA funds cover the out-of-pocket costs you pay to doctors, hospitals, and clinics. This includes copays when you visit a provider, coinsurance (the percentage of a bill you pay after insurance pays its share), and deductibles (the amount you must pay before insurance kicks in). If your plan has a $1,500 deductible and you pay $500 of it out of pocket, you can use FSA money for that $500.
Prescription medications are covered in full. If your insurance requires you to pay $30 for a month's supply of a drug, FSA money covers it. Medical equipment and supplies ordered by a doctor are also covered — this includes items like blood glucose monitors, lancets, syringes, crutches, wheelchairs, and orthopedic braces. The expense must be medically necessary and documented by a healthcare provider.
Mental health and therapy visits are covered if you pay out of pocket. If your insurance plan requires a copay for a therapist or psychiatrist, FSA money covers that copay. Physical therapy, occupational therapy, and speech therapy copays are also may be able to access.
Dental and vision care you can pay for with FSA
Dental work covered by FSA includes cleanings, fillings, root canals, extractions, crowns, bridges, and orthodontia (braces). You can use FSA funds for any dental procedure your dentist recommends, whether or not your dental insurance covers it. If you have no dental insurance and pay the full cost out of pocket, FSA money covers the entire bill.
Vision care includes eye exams, glasses, contact lenses, and contact lens solution. If you need a new prescription and buy frames and lenses, FSA money covers all of it. Laser eye surgery (LASIK) is also covered if you pay for it yourself. Sunglasses are not covered unless they are prescribed for a medical condition.
What FSA does not cover
Health insurance premiums — whether for medical, dental, or vision coverage — cannot be paid with FSA money. This includes premiums for your employer plan, a spouse's plan, or a plan you buy on your own. The same rule applies to long-term care insurance premiums.
Over-the-counter medications and supplies are not covered unless your doctor writes a prescription. This means you cannot use FSA money to buy aspirin, ibuprofen, cold medicine, antacids, allergy pills, or bandages from a store shelf. However, if your doctor prescribes ibuprofen or any other over-the-counter drug in writing, FSA money covers it.
Cosmetic procedures are not covered, even if performed by a medical provider. Botox, dermal fillers, teeth whitening, and elective plastic surgery do not may have access to. However, if a procedure is medically necessary — such as reconstructive surgery after an injury or birth defect — it may be covered.
Gym memberships, fitness classes, diet programs, and general wellness products are not covered. Vitamins and supplements are not covered unless prescribed by a doctor for a specific medical condition. Childcare and dependent care have their own separate account type (Dependent Care FSA) and cannot be paid from a medical FSA.
How to document and prove FSA expenses
Keep receipts and invoices for every FSA expense. Your plan administrator may ask you to submit proof that an expense is may be able to access before they reimburse you or approve a debit card charge. The receipt should show the date, the provider's name, what was purchased or the service provided, and the amount paid.
For prescription medications, the pharmacy receipt is usually enough. For medical equipment, keep the invoice from the supplier and any documentation from your doctor showing the item was medically necessary. For dental and vision care, the provider's receipt showing the date and service is sufficient.
If your FSA plan includes a debit card, you can swipe it at pharmacies and some medical providers. However, the card may be declined for items the system flags as non-may be able to access (like over-the-counter items). If that happens, you pay out of pocket and then submit a receipt for reimbursement by mail or through your plan's online portal.
Timing and the use-it-or-lose-it rule
FSA money must be used during the plan year it was contributed to. If your plan runs January 1 through December 31, you must incur the expense (not necessarily pay the bill) by December 31. Some plans offer a grace period of up to 2.5 months into the next year, but this is optional and not all employers offer it. Check your plan documents to see if your employer allows a grace period.
Any money left in your FSA at the end of the plan year is forfeited. You cannot roll it over to the next year or cash it out. This is why it is important to estimate your healthcare spending carefully when you choose how much to contribute during open enrollment. A common strategy is to contribute an amount you are confident you will spend, rather than the maximum allowed.
If you have a major life event — such as the birth of a child, marriage, divorce, or loss of coverage — you may be able to change your FSA contribution mid-year. Contact your plan administrator to learn what changes may have access to and what the deadline is.
Frequently Asked Questions
Can I use FSA money for my spouse's or child's medical expenses?
Yes. FSA money can be used for any family member's may be able to access medical expenses, not just your own. This includes your spouse, children, and dependents. The expense must still be may be able to access — copays, prescriptions, dental work, and medical equipment all may have access to regardless of who receives the care.
What happens if I don't use all my FSA money by the end of the year?
Any unused FSA funds are forfeited and returned to your employer. You cannot carry the money forward, roll it into a savings account, or receive it as a refund. Some employers offer a grace period (usually 2.5 months into the next year) to spend remaining funds, but this is not required. Check your plan documents to see if your employer allows one.
Can I use FSA money to pay my insurance deductible?
Yes. FSA funds can be used to pay any portion of your medical, dental, or vision insurance deductible. If you have a $1,500 deductible and you pay $500 of it out of pocket before insurance covers the rest, you can use FSA money for that $500 payment.
Are over-the-counter pain relievers and cold medicine covered?
Not unless your doctor writes a prescription. Aspirin, ibuprofen, acetaminophen, cough syrup, and allergy medicine bought over the counter are not may be able to access. However, if your doctor prescribes any of these medications in writing, FSA money covers them.
Can I use FSA money for dental work my insurance doesn't cover?
Yes. FSA funds cover any dental procedure recommended by your dentist, regardless of whether your dental insurance covers it. If you have no dental insurance or your insurance has limits, FSA money can pay for the full cost of cleanings, fillings, crowns, braces, and other dental work.