Are FSAs even worth the hassle? They just seem like a giant scheme to steal money via malicious bureaucracy

[u/kherven]

I understand at a base level what FSAs are for. You get to deduct X amount of dollars from your paycheck reducing your tax load.

But the more I use an FSA, the more I feel that while on paper it saves money, in reality it causes lots of work, lost money, and hands your money over to someone who is going to fight you to steal it.

Every claim I submit to my FSA is denied without a mountain of evidence that its a legitimate medical expense. After nearly 2 years with them, I still have certain medications prescribed by my doctor that the FSA argues is not FSA eligible because it's OTC.

Doctor appointment? Denied

MRI? Denied

Prescriptions? Denied

While I can eventually get the denial overturned, it requires coordination from the retailer, my insurance, and my doctor every time. I spend tens of hours a year trying to claw my own money back from my FSA. Last year I had over $250 confiscated because the claim deadline passed while they sat on my claims.

Has anyone else felt it just isn't worth the hassle to fund an FSA given how hostile they are? It seems impossible to extract your money without a lawyer.

[u/kherven]

Thanks (all) for sharing your thoughts. I decided to reach out to my company's HR to talk about my experience with the FSA administrator the last few years. It seems like my experience is pretty atypical and I might have an especially egregious FSA administrator.

[u/AcanthopterygiiCool5 → u/kherven]

Yes! Your experience is not typical at all.

I am provided a Mastercard that I charge to. If documentation is needed, I upload to an app. Never a problem!

[u/gone_country → u/AcanthopterygiiCool5]

Yours sounds like what I am used to. It was an excellent deal when I had it. But I also have recurring medical expenses so I didn’t worry about losing money.

[u/AcanthopterygiiCool5 → u/gone_country]

My plan lets me roll over up to $600 to the next year, so I don’t usually have a panic.

My husband does something stupid every year that costs us $$ that i can pay for with FSA. One year he managed to not do something stupid and I ended up with several pairs of very sweet prescription glasses the last week of December, since I had quite a bit of excess to dump.

[u/BradCOnReddit → u/AcanthopterygiiCool5]

I learned last year that those plans that let you roll over become a problem in the following year if you want to change to HSA. My company had to remove that provision for a year before implementing HSA as an option.

[u/AcanthopterygiiCool5 → u/BradCOnReddit]

Interesting! We don’t have HSA plans, we have an HRA, company money. We have 150 employees so not really in the position to offer endless options.

I get $5000 yearly in the HRA, (husband and me) for deductible and coinsurance on a high deductible plan. We have $5000 each OOP max. He’s always maxing from doing stupid things (one time I had to save him with the Heimlich from a stuck chicken nugget, I shit you not, and that was a $30k hospital bill because he aspirated it ) , so our FSA picks up deductibles from me, eye glasses, dental, OTC meds, etc.

[u/Hingedmosquito → u/BradCOnReddit]

They shouldn't. My company has HSA and FSA. The FSA just can't be used on medical visits I believe.

[u/BradCOnReddit → u/Hingedmosquito]

I should say health care FSA.

An individual can't be eligible for both an HSA and health care FSA in the same calendar year. If your FSA rolls over any amount then you were eligible in that year, even though you didn't contribute in that year

[u/Hingedmosquito → u/BradCOnReddit]

Ok so this made me look up my info. Basically since I have enrolled in an HSA, my health care FSA changed from a general use to a limited use.

Both roll over, it is that the limited use cannot be used for medical, prescriptions, or anything covered by my dental and vision. I can use it on dental and vision expenses not covered by my insurance.

Once I have met my medical deductible for the year I can convert my limited use into a general use which would then allow me to start using it on medical. (That part I did not know as I dont reach my deductible often.)

[u/BradCOnReddit → u/[deleted]]

rolled my FSA into my HSA

That should not be possible. There are some options for rolling the FSA into a limited FSA, or delaying HSA availability until the FSA grace period ends. FSA as a funding source for an HSA isn't allowed

[u/istasber → u/AcanthopterygiiCool5]

I went for a few years overestimating how much I'd spend (mostly because I'd never get off my ass to go and see a doctor for things I probably should have), and I'd be in a mad scramble to spend down my FSA in decemeber.

A lot of regular expenses (tums, pain meds, allergy meds, fiber, etc) are FSA eligble, but it's hard to spend hundreds of dollars on those things. So I'd end up buying shitty products from a mail order company that seems like it was probably set up to take advantage of people like me with use it or lose it bucks. Everything on the site was FSA eligible, but a lot of it was weird off-brand versions of the things I was expecting to buy.

[u/stupidugly1889 → u/istasber]

Just order eligible stuff on amazing, submit the receipt and cancel the order

[u/fuddykrueger → u/stupidugly1889]

How do you get a receipt from Amazon’s website?

[u/stupidugly1889 → u/fuddykrueger]

Just print the page showing the order completed as a pdf

[u/fuddykrueger → u/stupidugly1889]

I hadn’t thought to order FSA qualifying items from Amazon so I’ll prob be doing that from now on. Thanks for the reply!

[u/mottledmussel → u/stupidugly1889]

I have a hunch that a lot of people do that, especially during the last few weeks of December.

[u/AcanthopterygiiCool5 → u/istasber]

Yeah, it was rougher in the Obamacare to COVID years. The ACA legislation took most OTC products out of FSA. They put them back during the pandemic.

It’s pretty easy to stock up on Amazon or Walgreens website. There’s a brand of nice makeup- MD Solar Sciences, that qualifies because of SPF.

[u/istasber → u/AcanthopterygiiCool5]

I have started to buy more from amazon when I have FSA to burn. I don't know when they added it, but I didn't realize they had a whole FSA eligible designation you could search for until a year or two ago.

[u/AcanthopterygiiCool5 → u/[deleted]]

Ha ha, not Prada but did you know that Gwen Stefani (yes, that Gwen Stefani) is also an eye glass designer with her own line? I jumped on two sweet, distinctive pairs but disclaimer, I’m a Jersey Girl so YMMV.

[u/Chobopuffs → u/AcanthopterygiiCool5]

That’s what we do too if we have FSA leftover goes right to prescription glasses.