Flexible spending plans - advantages and disadvantages?

It is enrollment time at my job, and I for the first time I am thinking of signing up for the flexible spending plan. The older I get the more often I'm having to see the doctor.

Did flexible spending plans help you with your diabetic supplies a great deal--I think my plan has taken over the counter items off the list and possibly diabetic supplies.

I have used a Flexible Spending Account (FSA) for years. Initially I had some concerns about being able to use up all the money, but as the years have gone by my medical expenses have increased and the allowable contribution is now only $2500. And in 2011 the law was changed requiring over the counter items to be accompanied by a doctors prescription or letter of medical necessity. But unless your doctor is non-compliant I was always able to get them to sign that sort of stuff. Heck, one year I had left over funds and got my doctor to sign that I needed gym membership to manage my diabetes. I got that reimbursed that year.

My copays and deductibles are all pretty high, so no problem spending the entire amount. All of my meds, pump, CGM, and testing supplies are eligible. May as well use pre-tax dollars.

Pros: The full amount is on your card from the first day of the plan year. You can tap the full amount immediately if you need to.

Any copays, deductibles, coinsurance costs can be paid with a FSA. That is for medical, dental, eyeglass, prescription, DME etc. OTC meds will require a script but most docs you see regularly will usually write one for you.

Cons: If you don't use it you lose it.

You need to keep receipts to prove your purchases.

But, but , but!!!!!

Many employers grant a four month extension to use up unused funds.

Your employer may use a FSA manager to handle your account and when you set up an account they will let you know when your transactions are verified and you no longer need the receipts for FSA purposes. It also lets you track fund balances so you know where you stand.

Some employers tie a wellness benefit to FSA manager and there may be extra funds added to your card if you meet your employers health targets. For me it means a decrease in premium if I get a health screening and an extra 100 bucks on my flexcard if I log on and document my daily activity.

Things to think about - calculate - add up- be sure of-

In a year where there are no FUBAR health events how many docs of all kinds do you see? What is the total copay?
How many prescriptions? How much is the copay? Diabetic scripts, supplies, DME, pump suplies etc?
This needs to be looked at for each family member.

Once I have the total, I drop it by about a quarter, so I guarantee that I will use it all.

Has been well worth it for me - can use it all on the first day when the pump suplies are needed but the deductibles are not yet met, helps to smooth out the cash flow.