We’ve all encountered situations where the thought “I can’t afford that” has crossed our minds. It might have been for dinner with friends or your rent after already paying loans; maybe it’s trying to pay (after student aid) for your child’s college expense. Or maybe it was for a medical procedure, prescription or over the counter item.
For that last one, you may have more options than you think. Especially if you have a Health Savings Account, or HSA.
As a crash course for those of you who maybe aren’t as familiar with your benefits as you’d like to be, a Health Savings Account is a tax-free account that allows you to purchase certain medical expenses that are determined by the IRS and your employer. The money is tax-free because you elect to have it taken out of your paycheck before taxes and have it put into the HSA.
Generally, people with an HSA use it to pay for out of pocket expenses not covered by insurance.A lot of things fall under this bucket. But we’re not here to go over a list of expenses. (We have lots of those if that’s what you want, though. Just check our blog page).
Today’s topic is going over what to do when you think you can’t afford a medical payment or one of those eligible items. Specifically, the next time you’re getting ready to pay and cash feels tight, four ways your HSA can help.
Negotiate a bill for a lower price and/or payment plan
People often receive a hospital bill and then have to be rushed into the emergency room to put their eyes back in their head.
You can imagine why it might be useful to have a few negotiation tactics up your sleeve when it comes to medical bills. (Especially those pertaining to hospitalizations). There are a variety of reasons these bills can be so high, but they don’t need to stay that way.
Learn the steps you need to negotiate your healthcare bills.
Leverage services like GoodRx to get a better rate
GoodRx lets you find better prices on prescriptions faster. It’s a free service and collects prices and discounts from over 60,000 U.S. pharmacies.
Before purchasing your next prescription, visit GoodRx first. Once you’ve found the best deal, pay through your HSA.
Get advance access to funds with HSABRidge
If a product like HSABRidge is available through your employer, use it. This tool allows you to access future scheduled HSA deposits before they build up as a balance in the HSA.
When might you need this?
The HSA BRidge comes in handy any time your expense is more than your current HSA balance. When this is the case, you can swipe your benefits card from BRI and it will pull the full amount needed from HSA BRidge.
Over time, you pay back the expense in addition to whatever contributions you were already making to your HSA for the year. Think of it like an interest-free advance.
The fourth and final option is possibly the easiest and yet underutilized alternate way to pay with your HSA.
Reimburse yourself later when funds are available
If you have an eligible expense you need to buy but you don’t have enough money in your HSA, you can always pay from another source, like a credit card, and reimburse yourself from the HSA later.
Reimbursing yourself from an HSA is different than reimbursing yourself from other pre-tax accounts. If you’ve ever had a Flexible Spending Account (FSA) or Health Reimbursement Account (HRA) then you probably had to submit a claim for reimbursement. There are no claims with an HSA.
Because you own the money in an HSA, you don’t have to submit a claim for reimbursement. To request reimbursement, you will have to login to your online account (BRiWeb if your HSA is through BRI) and then request reimbursement from there. With an HSA, you cut out the middle man and reimburse yourself directly.
Pro Tip: Have your banking info ready. If you are going to be transferring money from your HSA into a bank account to reimburse yourself, you’ll need to have the account and routing number available.
Which of the four options are you most likely to use? Leave us a comment below!
See more tips on paying with your HSA and saving through your pre-tax accounts: