How Nurses Can Improve Their Health Using an FSA or HSA

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Flexible spending accounts (FSA) or health savings account (HSA) are two employer-sponsored plans nurses can use to reduce their income tax liability and pay for related medical expenses. This article focuses on how these plans can improve your health. If you need an article explaining the differences between an FSA and HSA you can find that here.  I have an FSA and will be writing about my experience with this program and how it can be beneficial to your health as a nurse.

With my FSA plan, you can use up to 2650.00 a year for related medical expenses. Your employer sets up this account at the beginning of each year, and you can start using the funds immediately as long as they are qualified expenses. Not every medical expense will qualify. One benefit is your employer splits the yearly amount you choose and equally deducts it from your paychecks throughout the year. The money used to fund an FSA or HSA is never taxed. This is one of the main benefits of this program, but not the only benefit as I will explain shortly in this article.

The first major way an FSA or HSA can improve your health is it forces you to invest in your health. Currently, I do not need to see a doctor very often for illness, but I choose to go and see my naturopathic doctor so that I can stay on the right track. My doctor is there for prevention, not to treat an illness or disease that has already occurred. It is difficult to spend the money to do this if I was choosing to spend it at that moment. I would probably never go so that I would not feel the Ouchy of having to spend the two or three hundred dollars it took for the consultation.

It is not cheap to pay out of pocket for a natural practitioner who may not take insurance. It is comforting to know that I have already chosen to spend 2650.00 for 2018 on my health and I better use it or lose it. Once I submit my receipt for the medical product or service, I will receive the money in my account in a week or less.  Since I am on a family plan, this money can be used for my wife and son as well.

The second major benefit is the money used to fund your FSA or HSA reduces your tax liability. As you know, you pay the most taxes on the upper limits of your income for that year. The money used for your FSA or HSA comes right off the top of that. You are getting a 25 to 30 percent (depending on your tax rate and income level) discount on any qualifying service or product you expense through your health savings account. That is very good news to a frugal guy like me.

Don’t worry if you are not able to spend all of the money you allotted for your health savings account. For the FSA you can roll over up to 500 dollars to the next year without losing it. This helps with peace of mind.

Also, it is good to think ahead about the medical expenses you are expecting to occur in the future. You can not always do this but in many cases, you can. For instance, if you are planning to have a child or planning to get surgery the next year, then you might want to put more in your FSA or HSA as opposed to less. This way you will have enough money to cover whatever the cost would be to you after insurance pays.

I was resistant to enrolling in an FSA when I first heard about it because I felt it was one more thing for me to keep up with and that it would make me spend money I would not normally spend. That is true to a point, but now I know, an ounce of prevention is worth a pound of cure.

To summarize, an FSA and HSA can improve your health as a nurse because it will push you to invest in your health before an issue arises. Second, it will give you a 25 to 30% discount on medical services and products. I enjoy saving money, and medical is very difficult to find discounts on from my experience.

I hope this article has been insightful for you and opened your perspective to opening an FSA or HSA through your employer. You could start with as little as a few hundred dollars if you wanted to test it out. You do not have to go all in with 2650.00 as I did. Let me know what you decide.  I would like to hear about your experience or any questions you may have about the process. Please leave them in the comments below, or you can message me by visiting my about page here.

I hope you have a healthy week and I look forward to writing more articles to help empower you to take control of your health.

Nurse Brian