Using Health Savings Accounts

HSA and FSA: the basic difference

A health savings account is generally tied to a particular type of health insurance and the money belongs to you, rolling over from year to year. A flexible spending account is set up through an employer and often has a deadline by which funds must be used, though some plans allow limited carryover or a grace period.

Both let you set aside money before income tax for eligible medical and dental costs. Because rules change and plans differ, your plan administrator or a tax professional is the reliable source for your own situation.

What dental costs are usually eligible

Common eligible items include checkups, cleanings, fillings, crowns, extractions, dentures and orthodontic treatment, since these address dental health. Cosmetic procedures, such as purely cosmetic whitening, are often not eligible.

Over-the-counter products can be a gray area. Some are covered and some are not, and a letter or note from your dentist is sometimes requested. Always check the administrator's eligible expense list rather than assuming.

• Exams, cleanings and X-rays
• Fillings, crowns and root canals
• Extractions and dentures
• Orthodontic care in many plans
• Cosmetic-only work is often excluded

Timing your spending

If you have an FSA, find out your plan's deadline and whether any unused amount carries over. Scheduling needed dental work before the deadline can make good use of the money you already set aside, but only if the care is genuinely needed.

With an HSA, there is generally no rush, since the balance stays with you. You can pay a bill out of the account right away or save receipts and reimburse yourself later, if your plan rules allow it.

Paperwork that saves trouble

Keep itemized receipts showing the date, the provider, the service and the amount you paid. A credit card slip alone often is not enough. Store the receipts and any related explanation of benefits in one folder.

If you pay with an account debit card, the administrator may later ask for documentation to confirm the purchase was eligible. Being organized now avoids a scramble or a repayment request later.

Fitting accounts into a bigger plan

These accounts work best alongside other steps: a written estimate, a clear view of your insurance, and a sense of which treatments come first. They reduce what you pay in tax terms, but they do not make care free.

Some readers also consider extras beyond dental visits. The seller of ProDentim, a chewable oral probiotic supplement, lists three strains and says it is not intended to treat any disease; research on oral probiotics is still developing and the evidence is limited or mixed. Check with your plan administrator whether any supplement is eligible, and ask a dentist, doctor or pharmacist first, particularly if you are pregnant, nursing, take medicines or have a medical condition.

Questions readers ask