How to Burn Through That Extra FSA Money Before You Lose It


NEW YORK (MainStreet) — Flexible spending accounts, which let consumers set aside up to $5,000 of pre-tax wages, are  becoming more popular as Americans look for a way to help offset expenses not covered by their insurance, like doctor’s co-pays or contact lenses.  

One drawback, however, is that the unused funds in these accounts are lost after Dec. 31 each year. So if you’ve got money still hanging out in an FSA, now is the time to use it. While  new laws went into effect in September 2010 that put more restrictions on how these dollars can be applied – most notably, over-the-counter drugs are no longer an option unless you have a prescription – consumers still have a long list of items they can purchase.

MainStreet reviewed some plans to round up expenses particularly relevant to this time of year. Here are some items might make good stocking stuffers or Secret Santa gifts and are applicable New Year’s resolutions. You should ask your provider for a list of what items your dollars can be specifically used toward. (Aetna has a full list available for plan participants on its website.)

Bandages. This can include brands like Band-Aid, Curad, Johnson & Johnson, Ace bandages or generic medical tape.

Reading glasses. You can also purchase a new pair of eyeglasses or sunglasses, but you will need a prescription.

Flu shot. The Centers for Disease Control and Prevention recommend anyone 6 months or older get their annual flu shot, so if you haven’t gotten yours yet, now is a good time.

Nutritionist. If your weight is an issue, you might want to ask your doctor to write out a recommendation for a good nutritionist. You could also put dollars toward certain weight-loss programs if your doctor recommends you start one due to conditions like obesity or hypertension.

Smoking cessation treatments. Those who are thinking about kicking the habit in 2012 might want to ask their doctor to write a prescription for aids like nicotine gum and patches or recommend a cessation program.

Orthopedic inserts. You can also purchase yourself a pair of orthopedic shoes, though many plans will only reimburse the difference in costs from regular footwear.

Just make sure it’s the kind that actually screens you from the sun, as many plans only cover sunscreens with a high SPF (usually 30 or higher).

Thermometer. Thermometers are included as long as they’re for medical purposes. For instance, you won’t be able to get reimbursed for the turkey thermometer you bought before Thanksgiving.

Some FSA accounts might also cover air conditioners or purifiers if a medical condition warrants it and a physician recommends one.

Warranties. If you never bothered to buy a warranty for your contact lenses, eyeglasses or hearing aid, now might be the time.

—Jeanine Skowronski is staff reporter for MainStreet. You can reach her by email at, or follow her on Twitter at @JeanineSko.

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