Millions of Americans have Flexible Spending Accounts, or FSAs, through their employer. An FSA lets you set aside up to $2,750 per year, tax-free, from your paycheck, to go toward health care expenses.
The NBC Bay Area Responds team has helped families avoid some FSA hurdles over the years, but now there are new ways to use your money.
The Coronavirus Aid, Relief, and Economic Security Act, or CARES Act, just changed federal law to allow you to use your FSA for over-the-counter medicine. That's a long-awaited green light for buying things like prain relievers, cough medicine, allergy pills, and such. Feminine products are included, too.
Health Equity, which handles FSAs for many employers, estimates about 32,000 additional items are now FSA eligible. Jody Dietel, a Vice President at Health Equity, says that while many changes in the CARES Act are temporary, this one isn't.
"Unless Congress changes their mind again in the future, this is in for good," Dietel said. "That is welcome news for consumers all across America.”
If you're unsure how your company's FSA works, ask your human resources department for help.
That brings us to a word of caution: if you get laid off, you might end up forfeiting what's left in your account. So, if you think a layoff is looming, ask your HR representative what the FSA rules are, and whether you can spend your FSA after you get a pink slip.
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If you've already lost your job, you might still be able to rescue your account, under COBRA. We know a layoff is a shock, and your FSA is not priority one, but we don't want you to lose as much as $2,750, at a time when every penny counts.
Health Equity -- formerly known as WageWorks -- has an online tool to help you stay covered. You can find it by clicking here.
