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Surprising Items Your Flexible Spending Account May Not Cover

Employee Benefits

A flexible spending account (FSA) is a medical health care and dependent-care vehicle that allows employees and employers to save on taxes by allowing the employee to make tax-free contributions to the account. These funds are then used to pay for eligible medical expenses.

How do FSAs work?

Health FSAs work for employees in two main ways: either by providing the employee with an FSA debit card that can be used to purchase items approved under the Plan; or by providing a reimbursement service to employees from their account when they submit substantiation for eligible expenses.

Employees with health FSAs are eligible to contribute up to $2,500 a year to the FSA and must use the funds in the account by the end of the plan year in which the contributions were made, and on medical expenses that were incurred during the same year. If a spouse also works, he or she may also contribute up to $2,500 to their health FSA. Any funds remaining in the account at the end of this term are forfeited by the employee and will be turned over to the plan.

What does an FSA cover?

Typically, most reimbursable items are readily understood, such as the co-payments and other expenses from medical doctor visits. Most dental expenses also qualify, such as costs for non-cosmetic orthodontics and extractions. Other items commonly covered by FSAs include:

  • Dentures
  • Eyeglasses/contact lenses
  • Medical monitoring devices
  • First aid kits
  • Walking assisting devices
  • Wheelchairs and repairs
  • Sterilization

What is not covered by an FSA?

Items not covered by FSAs could be surprising. For example, some over the counter (OTC) drugs and remedies are not covered by health FSAs unless there is a valid prescription from a medical doctor. So for example, OTC common cold medication is not eligible for reimbursement without a prescription.

Not all OTC drugs are covered under FSA plans, but the following are examples of items that are eligible when accompanied by a prescription:

  • Indigestion medications
  • Eye drops
  • Laxatives
  • Pain relievers
  • Sleep aids
  • Acne medications
  • Diaper rash ointment
  • Ointments for minor injuries

Other items that are not covered by FSAs include:

  • Cosmetic surgeries undergone for reasons other than correcting congenital deformities, disease disfigurement, or to correct personal injuries that result from accidents or trauma
  • Childbirth class expenses for the coach (those for the expectant mother are covered)
  • Exercise equipment for general well-being
  • Marriage counseling
  • Special foods that represent normal consumption and that satisfy nutritional requirements
  • Alternative provider treatments
  • Personal care items
  • Infant formula
  • Funeral expenses
  • Payment of insurance premiums
  • Prescription drugs from another country
This website contains articles posted for informational and educational value. Paychex is not responsible for information contained within any of these materials. Any opinions expressed within materials are not necessarily the opinion of, or supported by, Paychex. The information in these materials should not be considered legal or accounting advice, and it should not substitute for legal, accounting, and other professional advice where the facts and circumstances warrant.
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