The prices of clear aligner treatment might have you clutching at your wallet and reassessing your spending. But before you go reorganizing your entire budget, consider using your HSA funds, if you have them. These pre-tax funds can be a reserve of payments for your dental and orthodontic expenses, easing the potential stress of a high price tag.
Candid clear aligners are often a qualifying expense under HSA policies, which can provide a lot of help in covering your costs. Read on to find everything you need to know about paying for Candid with HSA funds.
Table of Contents
What Is a Health Savings Account (HSA)?
HSAs are accounts designed to hold onto pre-tax income until you apply it towards qualifying health expenses. HSA deposits can be regular (a set payroll deduction) or you can add funds whenever you’d like.
There is one qualification you must meet to open an HSA: you have to be enrolled in a high-deductible health plan. What qualifies as a high deductible is set by the IRS and can change every year. As of January 1st, 2023, this means a plan with a deductible of at least $1,500 for an individual or $3,000 for a family.
The IRS also sets the parameters for qualifying treatments and products, but they do so loosely. A wide scope of treatments is covered but it’s up to the HSA account administrator to interpret the guidelines. Always verify with them if something is covered before using your funds to avoid fees.
HSAs do give you the option to withdraw money from your account to use as you’d like. This comes with a 20% penalty, though, so it isn’t often the best choice, but you might find it beneficial in limited circumstances.
The big limit on HSAs is the yearly contribution. As of January 1st, 2023, you can contribute $3,850 if you are the only insured person on your plan and up to $7,750 if you insure your whole family.
That might be more than you anticipate spending on healthcare in any given year, but HSA funds don’t expire, rolling over year after year. This lets you build your savings to prepare for the unexpected. And once your HSA reaches a certain amount, you can invest the money in mutual funds and other options as defined by your account’s policy.
How To Get an HSA
The most common way to get an HSA is through an employer. In many cases, when companies offer a high-deductible health plan, they also offer HSAs. You just enroll in both when signing or during the open enrollment period, which usually takes place in the fall. Expect your HR department to walk you through the process.
You can also open an HSA on your own — whether self-employed or not. You just need to have a health plan with a deductible at or above the threshold set by the IRS. Banks, credit unions, brokers, and insurance companies can all offer HSAs. Contact the one of your choice to see what options are available.
Do HSA Funds Cover Dental/Orthodontics?
You can use your HSA funds to cover most treatments and even some products if they improve your oral or overall health. Preventative, basic, and major oral care can be paid for using HSA funds without paying a penalty. This means your twice-yearly dental visit is a qualifying expense, as are fillings, root canals, and gum disease treatment.
But HSA funds can’t be used for all dental and orthodontic care. General health products are excluded — think toothbrushes and non-prescription toothpaste. You also cannot use the funds for cosmetic treatments unless you are ready to pay the penalty.
What Types of Treatment Can an HSA Cover?
Anything that is deemed a cosmetic procedure typically will not be covered by your HSA. However, in many cases, the line between essential treatment and cosmetic procedures is thin. If you are concerned that your treatment might not be covered, speak with your dentist or orthodontist and contact your HSA administrator.
Commonly Dental Procedures
- Dental cleanings
- X-rays and scans
- Root canals
- Fluoride treatments
- Braces and clear aligners (in some cases)
- Sealants and bonding
This isn’t an exhaustive list, but it includes many of the procedures that people typically use their HSA funds to cover. But notice that braces and aligners are listed as cover in some cases. That’s because orthodontics falls into a gray area. In the majority of cases, it is major treatment, making it HSA eligible. That makes sense, given straighter teeth reduce wear, make it easier to avoid cavities, and even help with digestion by improving chewing.
The issue is that not every misalignment causes harm. Smaller gaps might not cause crowding with other teeth, and minor rotations don’t always make it harder to chew. Fixing these misalignments is cosmetic, not essential. And to make matters more complicated, your HSA administrator might define things in their own way. Always get approval before using funds.
Can I Use My HSA for Candid Clear Aligners?
In most cases, yes. HSAs allow you to use funds for medically necessary treatments, and clear aligners usually benefit your overall oral health — especially in-office and hybrid options, like Candid. On rare occasions, administrators might consider minor orthodontic corrections cosmetic, but most of the time, clear aligner treatment is an eligible expense, so you should be able to use HSA funds to pay for Candid.
If you are uncertain where your personal case falls, discuss it with your dentist and get clarification from your HSA provider.
How To Use HSA Funds for Candid Treatment
If you have a card linked to your HSA account, you can use it like you would any normal credit or debit card. Some HSAs will issue checks, which you can use just like any other check. Other HSAs will let you pay bills directly from your online account as long as you use your card or check for a qualifying expense. Otherwise, you’ll incur a 20% penalty and have to pay income tax on the amount.
Or, you can use another form of payment and then reimburse yourself by writing yourself a check or transferring funds from your HSA into a personal account. Just make sure that the expenses came after you established your HSA.
What If I Have Dental Insurance, Too?
Even though they’re often offered together, a dental insurance plan is not the same as an HSA. Dental insurance coverage doesn’t come out of your pocket, while an HSA consists of money you deposited.
If your dental plan has orthodontic benefits, insurance might cover Candid treatment. However, most orthodontic benefits have limits. Some have age limits, some have lifetime spending limits, and many will only cover up to 50% of the treatment cost.
Plus, if you have an HSA, that means you also have a high deductible health plan, so you’ll need to pay out of pocket until you meet your deductible, which could take a while.
All that to say: dental insurance probably won’t take care of your entire Candid treatment. And you can cover the rest with an HSA if you’d like. If you have both, it’s a good idea to use both, unless you’re saving your HSA funds for medical or dental expenses you’re expecting down the road.
Health Savings Accounts vs. Flexible Spending Accounts
HSA, FSA — it can feel like alphabet soup. And if you are confused, there’s a good reason: these accounts are very similar. Both accounts hold pre-tax income, and both allow those funds to be applied to qualifying healthcare expenses. But there are some key differences to be aware of.
|Who qualifies||Only people with a qualifying high deductible health plan (HDHP)||Anyone whose employer offers them as a benefit|
|2023 contribution limit||$3,850 for an individual, $7,750 for a family||$3,050 for an individual|
|Contribution adjustments||Anytime||Only during open or special enrollment periods|
|Expiration||None, unused funds will roll over||Dec. 31 every year|
|Account ownership||Owned by the individual and follows you during employment changes.||Owned by the employer. You lose it if you change jobs.|
|Using funds||Can withdraw funds for non-medical expenses, but must pay a 20% penalty||Might not have access to funds for non-medical expenses|
Just like HSAs, you can usually use FSA funds to pay for Candid treatment. However, it depends on the details of your specific account and how your administrator interprets qualifying expenses.
If you’re worried about the costs of Candid treatment, there are a few different ways to make it more manageable, including using your HSA funds. Check on your account’s qualifying expenses before diving in, and consult your employer or HSA administrator for further info. By taking advantage of your pre-tax dollars, you can commit to at-home aligner treatment without undue stress about the cost.
Frequently Asked Questions
Are HSAs voluntary?
Sometimes, they are automatically included in your employment benefits, with your HR team opening your account at the same time they enroll you in your health plan. However, contributing funds to the account is fully your choice.
Do employers contribute money to HSAs?
This isn’t always the case, but many employers will add funds to employee HSA accounts. If yours does, you can grow your healthcare savings without needing to contribute any of your actual wages. If you do opt to add funds, make sure that you don’t exceed the yearly limit between your contributions and those of your company.
What are the biggest differences between HSAs and FSAs?
The main differences are in who owns the account and what happens to the funds at the end of the year. With FSAs, while your employer cannot access the funds, their account belongs to them — you leave the company and you lose access. In contrast, you own your HSA. FSA funds also expire at the end of each year, while HSA funds roll over.
If I have both an FSA and an HSA, which should I use?
First, don’t start with your own money; begin with insurance benefits. Once you exhaust your benefits, assuming you have orthodontic coverage, move on to your FSA so you can use the money before it expires. Then, if you have remaining out-of-pocket costs, switch to your HSA. Just take care not to double-bill between the three.
If I change jobs, do I lose my HSA funds?
No, this is one of the big benefits of an HSA over an FSA: your account is yours, wherever you go. The only reason you should lose your HSA is if you change health plans to one with a deductible below the qualification threshold.
How do HSA administrators determine if something is cosmetic or not?
They start with the IRS guidelines and then interpret them as they see fit. Because there isn’t much in the way of hard and fast rules, you can’t really know what to expect, especially with orthodontics. It’s best to always get clarification first.
Why are in-office treatments more likely to be considered qualifying medical expenses?
In general, they are more likely to have a measurable positive impact on health than self-administered ones. On top of this, the provider can submit paperwork documenting the medical need for care, which isn’t always possible with at-home treatments.
Are HSA funds easy to use?
Yes, especially when you have a debit card tied to your account; you just use it like any other card. However, all payment methods are pretty easy. Reimbursement is the most difficult but still should only take a few steps to complete.
What happens if I use my funds for a non-qualifying expense?
First, you have to pay taxes on the amount spent. Then, you will pay a 20% fee on top of that.
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