Limited health care FSA
If I am enrolled in the High-Deductible Health Plan (HDHP) with a health savings account (HSA), why should I elect the limited health care flexible spending account (FSA)?
If you are enrolled in an HDHP, IRS rules do not allow contributions to an HSA if you are covered by any disqualifying health coverage, including a general purpose health care FSA. However, you may have coverage under a limited health care FSA and still remain eligible for HSA contributions. Refer to IRS Publication 969 for more information on the irs.gov website for more information.
What restrictions are placed on a limited health care FSA?
You cannot use a limited health care FSA to request reimbursement for medical and nonpreventive prescription drug expenses prior to meeting the HDHP deductible ($1,500 individual/$3,000 family).
However, you can use a limited health care FSA for the following expenses at any time:
- Dental care and orthodontia, such as fillings, X-rays, braces, and mouth guards.
- Vision care, including eyeglasses, contact lenses, solutions and supplies, and LASIK eye surgery.
- Preventive prescription coinsurance payments.
- Over-the-counter expenses.
Note: Certain over-the-counter medications require a prescription from your doctor. A complete list of eligible expenses can be found on the PayFlex® website.
After you've met the HDHP deductible, you can use the limited health care FSA to reimburse all eligible health care expenses.
How should I pay for my medical and prescription drug expenses prior to meeting the HDHP deductible?
You can pay for expenses out of pocket and receive reimbursement through your HSA until you meet the HDHP deductible.
How are out-of-pocket costs reimbursed from a limited health care FSA?
While you're enrolled in the limited health care FSA, you must submit all FSA reimbursement requests online, via the mobile app, or by submitting the FSA claim form. See Claims submission and reimbursement to initiate a request using one of these methods.
Note: The Auto Pay and debit card features are not available for the limited health care FSA.
Can I contribute to a health care FSA if I am covered under a high-deductible health plan through my spouse's employer?
Yes. However, you should consider electing a limited health care FSA so your spouse can remain eligible for HSA contributions. If you elect the general purpose health care FSA, your spouse will lose his or her eligibility to contribute to an HSA since your general purpose health care FSA is considered disqualifying health coverage and automatically covers your spouse.