Using Your HSA and FSA for LASIK

If you’re looking for ways to reduce the out-of-pocket cost of LASIK and you have either a Flexible Spending Account (FSA) or Health Savings Account (HSA), using the money in those accounts is a great option. But can you use an HSA for LASIK? Can you use an FSA for LASIK, too?

You can, and even better, you may have a few more options for that money in 2022 due to legislation passed during the pandemic. Let’s take a closer look at how to use an FSA or HSA for LASIK, and how to plan ahead to get the most out of these accounts.

What is the difference between an FSA and an HSA?

Both an FSA and an HSA are used to save money for future medical costs that you would otherwise pay for out-of-pocket. This money is set aside before taxes, or is tax-deductible. However, there are limits to how much you can contribute to these accounts each year. So, how does an FSA differ from an HSA?

An FSA must be offered through your employer, while an HSA is available to anyone who has a high-deductible health insurance plan. FSAs are only available for an employed individual, while an HSA can be used for an individual, or doubled for a family. HSAs also have a higher individual contribution limit than an FSA. With an HSA, you are able to roll over any unused funds to be used the next year, so you won’t lose any money you contribute to these accounts. With an FSA, you’ll lose any funds you don’t use at the end of the year, unless your employer allows the small $500 rollover allowed by the IRS.

Finally, both options save you on taxes. FSA contributions are always taken before your income is taxed, and the distribution of those funds is untaxed as well. HSA contributions can be taken out of pay pre-tax, but if they’re not they are tax-deductible. The growth and distribution of HSA funds are both tax-free as well.

How can an FSA be used?

An FSA is provided as part of your benefits package through an employer. You choose how much of your income you want to contribute over the course of the year, and employers may opt to contribute as well. The money in your FSA is typically considered “pre-funded,” which means you can use the amount of money you intend to contribute at any point in the year—even before you’ve actually contributed it. This can be incredibly helpful for paying for eligible medical costs earlier in the year rather than at the end.

However, you’re required to use any money in an FSA before the end of the year. Some employers allow a small rollover into the next year, but that amount is capped at $500, so this is truly a “use it or lose it” situation. Additionally, if you leave your employer after having spent “pre-funded” FSA money, you will need to pay back the funds you’ve spent, so spend wisely and time your spending well.

How can an HSA be used?

An HSA is only available to people with high-deductible health plans who don’t qualify for Medicare or as a dependent. You can open an HSA with a private insurer, or your employer may offer them. The funds in an HSA can also be invested, if your provider allows it, so the balance in your account could potentially grow without being taxed. Additionally, your funds will continue to roll over from year to year.

Withdrawals for eligible medical costs are tax-free. You can use the money in your HSA for other expenses, too, but you’ll pay a penalty tax if you choose to do so. Once you qualify for Medicare, you cannot continue to contribute to your HSA. However, at that point you can still withdraw from it, even for other expenses, without the penalty tax.

Can you use an FSA or HSA for LASIK?

So, then the question is can you use an FSA for LASIK and can you use an HSA for LASIK? The IRS has restrictions about what can and cannot be covered by money in an FSA or HSA. However, LASIK and several other laser vision correction procedures like PRK are eligible medical expenses, meaning you can use your funds in these accounts to cover any LASIK cost not covered by other insurance.

That said, the funds in your FSA or HSA may not be enough to cover the entirety of the cost of the procedure. That’s because you can only contribute a certain amount to these accounts per year and, in the case of FSAs, you might be required to use your funds before the end of the year, or lose them. Thankfully, the transition from 2021 to 2022 could be a little different.

2022 FSA and HSA contribution limits and deadline changes

Both FSAs and HSAs have maximum allowed contributions, which limits the amount of money you can put in your account over the course of the year. For 2021, the maximum contributions were:

  • FSA: $2,750 for an individual
  • HSA: $3,600 for an individual; $7,200 for a family

If you are 55 years old or older, you can also add an extra $1,000 catch-up contribution to your HSA in your own name. Keep in mind that if you have a shared family HSA account, you will need to open a separate account in your own name to make the $1,000 catch-up contribution.

For 2022, some changes have been made in terms of contributions and deadlines for using your funds. The maximum contributions are the same for an FSA in 2022, but they’ve gone up slightly for HSA contributions. HSA contributions can now reach $3,650 for an individual, and $7,300 for a family. For people with an FSA, the deadline for using money contributed in 2021 has the potential to be extended by your employer through 2022 due to the pandemic.

This is helpful because if you have an FSA, you typically need to use whatever money you contribute for the year before it expires. The extra time to use FSA funds, if your employer elects to offer it, and extra funds contributed for those with HSAs, can help people who are interested in using the money for LASIK.

Planning ahead to use your HSA or FSA for LASIK in 2022

If you’re interested in using your HSA or FSA for LASIK, you could have a little more freedom in 2022. With higher contribution limits for HSAs and potentially more time to use your FSA funds, you may be able to pay more of your LASIK cost than in any other year. That makes 2022 a great time to schedule your LASIK surgery.

To figure out exactly how much you’ll need to pay for the procedure, schedule a consultation with an experienced LASIK eye surgeon to find out how much your surgery will cost for you. From there, you can plan ahead to ensure you have the funds you’ll need and plan for any other LASIK financing you might need. Also find out whether your employer will be allowing you to roll over funds from 2021 to use any time in 2022. If so, you’ll have a nice amount of time to schedule your surgery. If not, you’ll need to schedule your procedure soon.

While it’s true that LASIK is not inexpensive, using your FSA or HSA funds can make it quite affordable. It’s also helpful to remember that LASIK is an investment in your long term vision and future quality of life. You can also use a LASIK cost calculator to see just how much money LASIK could save you on the costs of contact lenses and eyeglasses over a lifetime.

Use your FSA or HSA for LASIK at Dello Russo Laser Vision

Whether you have an FSA or an HSA, you can put those funds toward your LASIK eye surgery, and now is an ideal time to do just that. At Dello Russo Laser Vision, we create a personalized treatment plan for each of our patients to ensure the most precise vision correction results possible. Make an appointment for your complimentary initial consultation to get started and speak with one of our world class LASIK surgeons about your vision care plan.

From there, you’ll get your custom LASIK treatment plan, which will be personalized to you and your eyes, as well as a clear idea of the cost of the procedure for you. Our financial specialists can help you navigate any insurance benefits you may qualify for, and they can also help you apply your FSA or HSA funds to your LASIK cost. If you need additional help with financing, they can guide you through your other options, too.

Getting LASIK can change your life, and using your FSA or HSA money can help save you money and make it significantly more affordable for you. Dello Russo Laser Vision is here to help make the entire LASIK process easy, comfortable and stress-free. From scheduling your first appointment to your follow-up appointments after your LASIK procedure, we’re here to help you every step of the way. Find out more by contacting us online or by phone at (855) 646-2020.