Unlocking the Potential of Your HSA and FSA: More Uses Than You Ever Imagined

Imagine paying for alternative therapies, over-the-counter essentials, or even wearable medical devices — all with pre-tax dollars. Health savings accounts (HSAs) and flexible spending accounts (FSAs) make this possible, yet many people fail to take full advantage of these powerful tools. 

A recent survey by the Plan Sponsor Council of America found that more and more employees are obtaining HSAs, especially when matched by their employer, but still few are using HSA to their full potential. These accounts offer much more than covering doctor visits or prescriptions — they can revolutionize how you approach healthcare spending.

The basics of HSAs and FSAs

HSAs and FSAs are designed to give individuals more control over healthcare expenses by pre-allocating funds to use for qualified medical expenses while saving on pre-tax contributions. HSAs are linked to high-deductible health plans (HDHPs). Conversely, FSAs are typically employer-provided and require funds to be used within the plan year, although some plans offer short grace periods or carryovers.

Unlike FSAs, HSA funds roll over annually and can even be invested, creating the potential for growth over time. This makes them an excellent option for both immediate healthcare needs and long-term planning. 

Despite their benefits, many people overlook these accounts. According to the U.S. Bureau of Labor Statistics, HDHPs and HSAs have nearly doubled in 10 years, but many people are still using their HSAs inadequately. FSAs often face a similar issue, with unused funds going to waste due to a lack of planning. 

These accounts not only help manage healthcare costs but also reduce taxable income, making them a financial win-win. However, unlocking their full potential begins with understanding how they work, what they can cover, and how to simplify the process of using them.

Surprising eligible expenses

Although most people consider HSAs and FSAs as tools for paying co-pays, prescriptions, and deductibles, the list of eligible expenses extends far beyond these basics. Governed typically by the IRS as what can be a pre-tax qualified medical expense, from acupuncture to incontinence treatments, these accounts can be a game-changer for managing health-related expenses. 

For instance, parents can also use these accounts for breast pumps, baby monitors with health features, and other child-related healthcare expenses. Everyday items like sunscreen, first-aid kits, and cold medicine are also eligible, making HSAs and FSAs even more versatile than many realize.

HSAs and FSAs offer additional opportunities for those managing specific health conditions. “Products like Elitone to treat bladder leakage can be purchased directly through your FSA or HSA,” explains Gloria Kolb, founder of Elitone. “These funds remove barriers to accessing treatments that improve quality of life.” 

With such a wide range of possibilities, it’s clear these accounts can serve far more needs than most people expect.

Simplifying the process with Sika

One common complaint about HSAs and FSAs is the reimbursement process, which can be cumbersome and confusing. That’s where companies like Sika come in. 

By partnering with products like Elitone, Sika simplifies the process by pre-qualifying the product as FSA-eligible, allowing Elitone customers to check out without the need to submit receipts and wait for reimbursements. This ensures compliance with HSA/FSA requirements while reducing hassles for users.

Streamlining this process saves time and encourages more people to use their accounts effectively. Many people avoid making eligible purchases simply because they are unsure how to navigate the reimbursement process or what is eligible.

“When you remove obstacles, people are more likely to use these accounts for their intended purpose,” Kolb emphasizes, “and get valuable health products that they may not have otherwise because the funds are there just for that purpose.”

Uncovering what’s covered

The range of eligible expenses can feel overwhelming at first, but there are tools to help you navigate the options. Most HSA and FSA administrators provide lists of covered items and services, often accessible through online portals or mobile apps, that let you search for specific products to know which ones qualify. Additionally, many administrators offer customer support to answer questions about unusual or less common expenses.

It’s worth taking the time to explore your plan’s guidelines thoroughly. For instance, you might discover that travel costs for medical care, home modifications for accessibility, or certain wellness products are eligible. Many don’t realize that seemingly unrelated expenses can fall under these accounts when tied to a medical need. 

“It’s always worth asking or checking with the IRS regulations,” Kolb notes. “Many of the surprises you uncover can make a big difference in how you manage your health.”

Maximizing your HSA or FSA

Thoughtful planning is essential to getting the most out of your HSA or FSA. Begin by estimating your healthcare needs for the year, considering both routine costs and potential unexpected expenses, such as medical travel or specialized treatments. Setting realistic contribution goals ensures you have enough funds without overcommitting, particularly with FSAs that have use-it-or-lose-it policies.

Recordkeeping is another crucial habit. There is an IRS limit of $3300 for FSA and $4300 for HSA in 2025. Maintaining a record of your purchases helps you stay within the limit and validate expenses if questions arise, which protects you in case of audits and helps you understand your spending habits over time. By tracking your usage, you can make more informed decisions about future contributions and maximize the value of these accounts.

Rethinking healthcare spending

HSAs and FSAs are opportunities to take control of your healthcare spending. Although you can spend HSA dollars on items like sunscreen, the real value is having a nest egg for larger items that arise. Too often, financial hardship (or even ruin) is due to unplanned medical surprises. Using pre-tax funds allows for more incentive to save. Since HSAs carry over year to year based on plan, this could potentially be a sizable savings. Then, they can be utilized when a larger purchase arises, such as a bladder treatment, cooling wrap for an injury, or other unique treatments. 

HSA and FSA accounts represent a powerful way to prioritize your health while optimizing your financial strategy. Too often, people underestimate the value of these accounts, but they can unlock their full potential by taking the time to understand what’s available, planning contributions carefully, and exploring the full range of eligible expenses.