Can FSA or HSA Pay for Mental Health Expenses?
Finding the right psychologist or psychotherapist is not as easy as finding the right dentist. Usually, you need to work – get a feel for the consultant to see if his methods really suit your needs.
But once you find someone you would like to work with, the problem of payment inevitably arises, which usually raises many logistical questions: Does the therapist accept insurance? If so, are they online? If you pay out of pocket, can you afford it?
Healthcare in the United States is what it is (commercial hell), there is a real workaround to help pay for mental health care that many people don’t take advantage of: flexible spending or health savings accounts.
What are FSA and HSA?
The Flexible Spending Account and the Health Savings Account are similar financial instruments, with a few exceptions and qualifications. Health Savings Accounts (HSA) are options included in nearly all major high-contribution health insurance plans. If you are enrolled in a self-employed health plan, you can send a portion of your salary to one of these pre-tax accounts and use that funds to pay deductions, co-payments, and other medical expenses. (If you don’t have workplace health insurance, you can still deposit money into your HSA, albeit without the luxury of pre-tax.) This means that the HSA is essentially a rainy day fund to pay for physical and mental health. – and the money will remain yours, even if your plan is terminated or you quit your job. The FSA, on the other hand, covers the same costs, but only guaranteed by the specific employer. Unfortunately, FSA funds will expire after a year if they are not used by a specific date, and you usually only have a specific window during which you can file a claim for any expenses accrued in the previous year. Check with your employer if you can roll over the unused portion of your FSA – you can usually roll over up to $ 500 .
Unlike the typically bureaucratic and arduous health care payment process in a general sense, the FSA and HSA are fast and efficient. Usually, the money you deposit can be accessed even with a dedicated debit card (although you can also send related expenses to your plan administrator for reimbursement).
The health care resource Therapy Choice provides more details on flexible accounts:
With HSA, every penny you deposit (up to the contribution limit) remains yours until you spend it on appropriate health care. Your HSA savings can be invested like 401 (k) savings and grow tax-free. When you ultimately need to withdraw funds to cover medical or mental health expenses, those funds are tax deductible.
You can use your HSA money for a GP visit, hospital stay, and more. This makes it a useful resource for people exploring options for paying for mental and behavioral health services.
Both the HSA and FSA have contribution limits, each of which has been expanded in 2020. This year “people can contribute up to $ 3,550 into their HSA, and couples and families can contribute up to $ 7,100,” according to Choosing Therapy, while “employees can contribute $ 2,750. for FSA Health, ”according to People Keep.
How to use HSA or FSA to pay for mental health care
It’s easy, at least when it comes to swiping a card. Since you can use a special debit card provided by either your employer or your health insurance provider with your account, all you have to do is provide the card number to the person who bills you when you pay for your visit – in full or as a copay. If you would like to receive reimbursement for past services or a copay, you can ask your GP or counselor for a receipt and give it to the provider as required by your plan.
But then everything becomes unclear. It is important to remember that your HSA / FSA does not give you the full opportunity to pay for mental health care the way you want, so you will have to overcome the red tape first. HSA / FSA models are great for paying for regular doctor visits and even for psychiatric prescriptions, but talking therapy may require a referral from your PCP.
Connect Your Care health experts explain :
Treatment provided by a psychologist or psychiatrist is eligible for FSA or HSA compensation if the goal of the treatment is medical care and not general improvement in mental health. For this reason, things like marriage counseling or couples therapy are not eligible for FSA and HSA coverage.
Typically speaking therapy and mental health care are HSA / FSA compliant, but it will be necessary to speak with your healthcare provider or HR department to understand how to proceed first.