What is Flexible Spending Account (FSA)?
Insurance glossary entry on BeCovered.ai for the term "Flexible Spending Account (FSA)": Employer-sponsored pretax account for qualified medical or dependent care expenses. Scope: plain-language meaning for coverage discussions; confirm definitions on your policy forms.
Employer-sponsored pretax account for qualified medical or dependent care expenses.
Understanding Flexible Spending Account (FSA)
Health FSAs are use-it-or-lose-it (with limited rollover/grace options). FSAs generally disqualify HSA contributions if not limited-purpose or post-deductible compatible.
Examples
- Elect $2,750 health FSA during open enrollment for predictable copays and glasses.
- Dependent care FSA for daycare expenses up to IRS caps.
Common Questions About Flexible Spending Account (FSA)
Can I have FSA and HSA?
Only certain limited-purpose or post-deductible FSAs are compatible—verify plan documents before electing both.
Do FSA funds roll over?
Employers may offer up to IRS-allowed rollover or grace period—not guaranteed. Spend planning matters.
Related Insurance Types
Related Terms
Copay (Copayment)
A fixed amount you pay for a healthcare service at the time of the visit.
Coinsurance
The percentage of costs you share with your insurance company after meeting your deductible.
Deductible
The amount you pay out of pocket before your insurance coverage kicks in.
Out-of-Pocket Maximum
The most you'll pay for covered healthcare services in a plan year, after which insurance pays 100%.