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How to use your HSA and FSA for LASIK surgery?

December 24, 2020

Did you know that for the tax year 2021, you can use your Flexible Spending Accounts (FSA) and/or your Health Savings Account (HSA) for LASIK surgery? You can, according to the IRS, which recently labeled these surgeries an eligible expense. With these tax-free accounts, you can pay for your LASIK surgery with pre-tax dollars, which could mean a savings of up to 20%-30% if you’re eligible. That’s huge! But time is running out. If you haven’t used your 2020 FSA funds, make sure you book your appointment right away if you’ve been wanting LASIK surgery. Read on to find out more about FSAs and HSAs, and just how you can use them for your LASIK surgery.

What Is a Health Savings Account (HSA)?

An HSA is a component of health insurance that provides a tax-advantage “piggy bank” into which you can place pre-tax dollars through payroll deductions. You can then utilize those tax-free funds to pay for out-of-pocket healthcare expenses. The caveat is that you must be enrolled in a high-deductible health care policy in order for you to be able to be eligible for an HSA.

For 2021, the contribution amounts increased slightly. The amounts you can set aside for an HSA is $3,600 for an individual or $7,200 for a family.

Unlike an FSA (which we’ll get to later) there’s no requirement to “use it or lose it,” so you can accumulate funds into your HSA until you’re ready to use them. And, if you’re 55 or older, you can contribute an additional $1,000 towards your HSA.

Can I use HSA for LASIK?

YES, you can use your HSA for LASIK surgery now! In other words, you can pay for LASIK with HSA funds.

How to Use HSA to Pay for LASIK Surgery?

With your HSA, as mentioned above, there isn’t a time limit to utilize the funds. You can fund your HSA every year as much as possible, then decide to use it when you have enough money to cover your LASIK.

And, if your employer offers an FSA program (which we’ll go into in detail below), you can even use it in conjunction with your HSA to fully fund your LASIK procedure.

What Is a Flexible Spending Account (FSA)?

An FSA account is similar to an HSA, with some key differences. An FSA also allows you to set aside pre-tax income to pay for certain out-of-pocket medical expenses. Each year, you can set the level you’d like to contribute, and each contribution is spread out evenly over the course of the year.

A key difference from an HSA is that the max contribution you can contribute to the tax year 2021 is $2,750.

One of the great things about an FSA is that you can actually access the full annual amount of your contributions, even if you haven’t made all of your pre-tax distributions yet!

However, there is a “use it or lose it” provision where you must use the full contribution amount within each 12 month period, or else you’ll risk losing the balance. That being said, there may be a grace period for some plans where you can delay the use of funds for up to 2 and a half months into the new plan year.

Can I Use FSA for LASIK?

As of right now, the IRS is allowing FSA funds to be used for LASIK surgery, so utilize those funds while you can!

How to Use FSA to Pay for LASIK Surgery?

You can use your FSA dollars to help pay for LASIK surgery if you’re a candidate for LASIK or other laser vision correction procedures, but there’s a catch: the entire cost of the procedure may not be covered by your FSA fund, especially if you’re opting for the most advanced technology.

However, if your company’s FSA plan has a grace period, you can combine the remaining FSA funds from the previous year with the FSA funds from the current year. So if you wanted to, you could leave all of your previous years’ FSA fund money in your account until the grace period, and then combine it with the full amount for the next year. Doubling up, essentially, on your yearly FSA distributions can help to offset the full costs of LASIK.

Conclusion

The bottom line is that the HSA and the FSA are both LASIK eligible right now. But that doesn’t mean they will be forever. So while you can, take advantage of the fact that you can use FSA for LASIK and use HSA for LASIK.

Have you been considering LASIK? As mentioned above, you can use your HSA or FSA card to get your eligible expenses covered – for more information call us at (312) 444-1111 or contact us here. We encourage all patients to check with their employer for specific guidelines and their disbursement options.

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Dr. Colman R. Kraff

Committed to advancing new technologies in the field of ophthalmology, Dr. Colman Kraff helped to pioneer laser vision correction. In February of 1991, as part of a five-site, U.S., FDA clinical trial team, Dr. Kraff successfully performed the first excimer laser procedures in the Chicagoland area using the VISX Excimer Laser.

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