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Spelling It Out: Paytient vs. FSAs

Providing employee healthcare benefits comes with a lot of responsibility—and acronyms, for that matter. In the second installment of this 3-part series, we'll compare the features of a flexible savings account (FSA) to those offered by Paytient, then discuss how they can complement one another to help employers present their people with more flexible healthcare payment opportunities.

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Whether planned or unexpected, healthcare decisions are also financial ones. And with so many people forced to choose between financial and physical health, having more financial confidence around healthcare expenses enables people to be more proactive with taking care of their physical health. 

A flexible spending account (FSA) is another option that helps employers soften the financial hit whenever medical expenses strike.

What Is an FSA?

FSAs and HSAs share two letters because they both stem from the concept. Like HSAs, an FSA is a savings account provided by an employer that enables employees to save pre-tax funds to be used for any qualified healthcare expenses that may arise. 

Now, here is where the two accounts differ. Where HSAs require enrollees to be enrolled in an HSA compatible High Deductible Health Plan (HDHP), FSAs can be paired with any health plan. Furthermore, FSA holders contributions are capped at $2,750 annually, and unused funds don’t carry over unless employers set up certain parameters or allow a grace period.

Finally, while HSAs are employee-owned, FSAs are employer-owned, meaning when someone leaves for a new job, the FSA funds are left behind. Conversely, if an employee spends ahead of their FSA contributions and then leaves their job, the employer is on the hook for those dollars. 

Still, FSAs can be a great tool for employers looking to encourage pre-tax savings for healthcare. Paytient used alongside an FSA can help fill in some of the gaps an FSA can’t address.

How Can FSAs and Paytient Work Together?

In short, Paytient can help pick up the slack when FSA funds run out or cover expenses that arise outside of qualified medical expenses. Because FSAs are a “use it or lose it” benefit, employees should spend all their funds before the next enrollment period.  

And when that account is tapped, Paytient provides a convenient, interest-free source of funds for healthcare expenses. Paytient members receive a Visa card with a credit limit set by the employer, typically between$500 to $5,000 to match the health plan out of pocket maximum. 

Those dollar amounts can go toward any medical needs from providers in approved spending categories that accept Visa as a form of payment. Popular use cases range from emergency dental work and glasses to orthodontia and veterinary bills. Also, the Paytient card can be used to pay outstanding bills as long as they are still owed to the provider and not in collections. 

After each charge to the Paytient card, employees are prompted to set up a payment plan (up to a max of 12-36 months) to pay off the charge. As the balance is repaid, funds become available to spend again on future healthcare needs. Add Paytient to your FSA offerings to close wellness financing gaps and make every healthcare decision easier.

Click here to read the series’ first installment — Paytient vs. HSAs.

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