How to Save on LASIK Using a Flexible Spending Account (FSA)

Key Takeaways

• A Flexible Spending Account (FSA) is an untaxed savings account that allows you to pay for certain health expenses
• LASIK and other laser vision correction procedures are eligible expenses that your FSA can pay for you
• The maximum contribution limit for 2023 FSAs is $3,050
• The average cost of LASIK surgery is between $4,000 and $5,000
• Your yearly contribution to your FSA will likely not cover the full cost of LASIK
• If your company offers a grace period, you can combine funds from the previous year to the current year and cover more of your LASIK procedure cost
• You can also combine your FSA and HSA funds to pay for your procedure

LASIK, or laser-assisted in situ keratomileusis, is a laser eye surgery that corrects nearsightedness (myopia), farsightedness (hyperopia), and astigmatism. LASIK is an excellent treatment option for those who no longer want to wear contact lenses or eyeglasses.

However, LASIK eye surgery can be expensive for some people. One way to save on LASIK costs is through a Flexible Spending Account (FSA).

Can I Use My FSA for LASIK?

Flexible Spending Accounts (FSAs) can save you money on LASIK costs. The IRS allows you to apply your FSA funds towards laser vision correction, including LASIK, SMILE, and PRK. 

Depending on the doctors' technology, LASIK eye surgery typically costs between $4,000 and $5,000 for both eyes. If you plan to use your FSA to cover laser eye surgery, here are a few things to consider: 

• An FSA requires you to spend the account funds within the plan year, or you’ll lose those dollars.
• If the LASIK surgery costs more than $3,050, the yearly contribution limit will likely only cover part of your procedure.

What is an FSA?

An FSA, or Flexible Spending Account, allows you to set aside pre-tax dollars for healthcare expenses. You can open an FSA through your employer if they offer the option.

After opening an FSA, you can contribute a certain amount each year, subject to IRS limits. Remember to check the IRS for yearly limits. Your employer may also contribute a limited amount to your FSA account.

With an FSA, you receive a debit card to pay for medical procedures. Alternatively, keep receipts and all healthcare spending documentation for reimbursement.

Note: In this article, FSA refers to healthcare FSA, not dependent care FSA for child care expenses or care for dependents.

How to Use Your FSA to Pay for LASIK Surgery

Your FSA’s maximum yearly contribution will only cover part of the full amount of LASIK. If your company offers a grace period, you can save your FSA funds and combine them with the following year's contribution.

This allows you to use the maximum amount of untaxed FSA dollars to pay for your LASIK procedure. You can also use your HSA to pay for LASIK or combine funds from your FSA and HSA to pay for the procedure. The best advice is to plan and speak with your eye surgeon's office to coordinate the timing of your procedure.

Other FSA LASIK Options

You can check with your employer to see if these options are available:

A Grace Period of Up to 2 ½ Months

Instead of expiring after a year, your employer can offer 2 ½ months to use your FSA funds. Depending on how the plan is set up, your employer may offer a grace period of less than 2 ½ months.

You can save your funds from the previous year and combine them with funds from the current year as long as you are within the grace period. The combination of funds can offset the majority of your LASIK procedure costs. 

Roll Over $500 of Unused Funds

If you spend all of your FSA money by the end of the year, most of the funds will stay active. However, your employer may allow you to roll over $500 of the FSA balance into the following year. 

You can still contribute your total yearly limit on top of the $500. Remember that your employer can only offer one of these options, not both. They may also not provide either choice.

Pros & Cons of FSA for LASIK

A flexible spending account (FSA) is a savings account typically used for healthcare expenses. It’s a solid way to lower your tax burden and save on healthcare costs.

These are some advantages to consider if you’re going to use FSA for LASIK:

• No health insurance is necessary. You can open an FSA whether or not you have a health insurance plan. With an HSA, you must also sign up for a high-deductible health insurance plan. 
• Access your funds immediately at the beginning of the year. Once your FSA plan year starts, you can immediately use the full amount. You pay back the funds throughout the year via automatic paycheck deductions. With an HSA, you can only use the amount you contributed to the account.

These are some disadvantages to consider if you’re going to use FSA for LASIK:

• You can’t open an FSA on your own. You can only sign up for an FSA through an employer, unlike an HSA, which you can open independently if your employer doesn’t offer it or you’re self-employed.
• An FSA has lower contribution limits than an HSA. An FSA limits you to $3,050 for 2023. You can also apply your FSA funds toward your spouse’s or dependent’s medical expenses. For 2023, HSA limits are $4,150 for individual coverage or $8,300 for family coverage. 
• FSA funds expire. With an FSA, you must “use it or lose it” within the year. In comparison, your HSA dollars remain in your account until you use them.