An FSA (or flexible spending account) is an employer-sponsored healthcare benefit that gives employees the ability to pay for qualified medical expenses with pre-tax income.
Currently, in 2020, employees can set aside up to $2750 in a fund specifically for this purpose but it is a use-it-or-lose-it situation. If you do not use the money by the end of the year, you forfeit the unused funds to your employer.
Your employer deposits a set amount from your paycheck into your FSA account each pay period. In some cases, you can use the designated money before it has accumulated. For example, if you have signed up to have $2000 removed over the course of the year, then with some plans, you can spend that amount even if you are still paying in. You must repay the funds used in advance if you leave your employer before the end of the year.
Depending on the employer, some FSA accounts have a small grace period for funds that were not used within the calendar year. However, it’s always best to plan for medical expenses and use the funds before the deadline.
What Qualifies as a “Medical Expense” for an FSA Account?
The Internal Revenue Service (IRS) ultimately decides which products and services fall under the definition of “medical care.” Typically, they define “medical care” as “the amount paid for the diagnosis, cure, mitigation, treatment, or prevention of disease, or for the purpose of affecting any structure or function of the body.”
Qualified medical care typically includes durable medical equipment such as the Aluna device.
What is durable medical equipment (DME)?
Not all medical devices qualify as DME using the IRS definition. Durable medical equipment has to meet certain criteria, such as being long-lasting and being used for medical reasons. A doctor’s prescription may be necessary. Most of these DME devices are used for home-based care.
Check with your plan administrator to see if Aluna qualifies under your specific FSA plan.
Durable Medical Equipment is eligible for reimbursement with flexible spending accounts (FSA), health savings accounts (HSA), and health reimbursement accounts (HRA). However, you need to confirm if DME is covered if you are using a limited care flexible spending accounts (LCFSA) or dependent care flexible spending accounts.