Can I use a Flexible Spending Account (FSA) to pay some medical expenses?
A Flexible Spending Account is a special account you put money into that you use to pay for certain out-of-pocket health care costs. You don’t have to pay taxes on this money. This means you’ll save an amount equal to the taxes you would have paid on the money you set aside.
An FSA is available only with job-based plans.
You can put up to $2500 into an FSA each year. You must use that money within the plan year. (Some employers give you a "grace period" of up to 2 ½ extra months to use the money in your FSA.) At the end of the year or grace period, you lose any money left over in your FSA. So it's important to plan carefully and not set aside more than you think you'll spend on things like copayments, coinsurance, drugs, and other allowed health care costs.
You can spend FSA funds on prescription medications, as well as over-the-counter medicines with a doctor's prescription. Reimbursements for insulin are allowed without a prescription. Also, FSAs may cover costs of medical equipment like crutches, supplies like bandages, and diagnostic devices like blood sugar test kits. You can’t spend FSA funds on insurance premiums.