As you research Invisalign treatment, it is easy to get overwhelmed by the cost. With prices ranging from anywhere from $3,000–$7,000, and potential additional expenses on top of that, you no doubt want to reduce your out-of-pocket expenses as much as possible.
Health Savings Accounts (HSAs) can help reduce your burden and make your dream smile a reality. While every HSA has its own policies, in most cases, these pre-tax funds can be used for Invisalign treatment. Here is everything you need to know about applying HSA funds to your in-office aligners.
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HSAs at a Glance
Many people, especially adults in their 20s and 30s, opt for high-deductible health insurance plans. These plans tend to have lower premiums that are offset by a higher deductible that must be met before the policy starts to pay out on treatment. For younger, healthier individuals, this tradeoff is often financially beneficial.
However, these plans can make it difficult for insured individuals to afford health care costs when they arise. HSAs were created to fill in the gap.
HSAs are tax-advantaged accounts that both you and your employer can contribute to and help save for certain medical expenses. You are only allowed to contribute a certain amount per year, but the balance carries forward at the end of each year, allowing you to steadily build your health savings over time. While employers can contribute, the HSA is not tied to your job. If you switch companies, your HSA can travel with you.
HSAs vs. FSAs: How Are They Different?
For the most part, HSAs and FSAs are the same: you use their funds to cover treatment that you would otherwise pay out of pocket and store money in the accounts tax free. But the differences are key to understanding how to make the most out of your funds. Here’s a rundown of how they differ.
|How to Qualify||Have a high-deductible health plan.||Work for an employer that offers Flexible Spending Accounts (FSAs).|
|2021 Contribution Limit||$3,600||$2,750|
|Contribution Adjustments||Anytime||Only during special or open enrollment periods.|
|Expiration||There is no expiration for funds.||Every year on December 31st.|
|Account Ownership||The insured individual||The employer|
|Using Funds||Can be used for medical expenses or withdrawn for a 20% penalty.||Typically cannot be used outside of medical expenses.|
|Limits on Spending||You can only spend what had been contributed but can later file for reimbursement.||You can use your FSA based on what you are expected to contribute by the end of the year.|
Do HSAs Cover Dental Work?
Yes, HSA funds can be used to cover dental work and orthodontics, but there are limits to this.
With HSAs, you can use the funds to pay for medically necessary treatments. This includes things like preventative care and correction of abnormalities that either are causing health problems or have the potential to cause health problems to develop.
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, contact your HSA administrator.
Covered Dental Procedures
- Braces and aligners (in most cases)
- Sealants and bonding
- Fluoride treatments
- Dental cleanings
- X-rays and scans
- Root canals
HSAs and Invisalign: Is it Covered?
Invisalign treatment exists in something of a gray area when looking at HSA coverage. Your HSA funds can be applied to essential medical treatments but not to cosmetic ones. Yet Invisalign can be both.
Severe improper spacing of the teeth, bite problems, and irregularities in the jaw are all can cause significant oral health problems. For example, teeth that do not align properly can cause jaw joint disorders and severe pain, while those that are too crowded are more likely to develop cavities and decay. As such, when Invisalign is used to treat these conditions, it is almost always acceptable to use HSA funds to pay for it.
However, many people get Invisalign to close small gaps or address minor crowding that isn’t considered medically necessary. In these situations, it is possible that your HSA will not be able to be used to cover treatment.
Before using your HSA to pay for part or all of your treatment, verify that your case qualifies as essential medical care.
How to Use Your HSA Funds
When you have a procedure you want to cover with your HSA funds, you need to follow your provider’s instructions for accessing them. In most cases, you will have four options:
- Debit/Benefits Card: With this option, you use your HSA just as you would a checking account. Transactions are limited to medical merchants and the current balance of your HSA.
- Checks: Many HSA managers will also issue checks if you request them. These are then used just like checks for your regular bank account.
- Online Bill Pay: If your company offers this feature, you can pay medical providers directly through the portal for your HSA.
- Reimbursement: With this option, you go ahead and pay out of pocket. Then, you reimburse yourself using your HSA funds.
You are welcome to use any of your HSA’s approved payment methods. Which one you choose is up to you.
What If I Have Dental Insurance, Too?
If your dental insurance covers orthodontic treatment, it should cover at least part of the cost of Invisalign treatment. However, most people will be left needing to pay for at least part of the cost of treatment out of pocket.
You can use both your dental insurance and your HSA to pay for your Invisalign treatment. Talk to your dentist or orthodontist about how they can help you maximize your benefits.
Invisalign treatment can be life-changing, but not everyone can afford to pay for the full cost of treatment out of pocket. If you have an HSA and dental insurance, you can potentially reduce the cost of treatment or even get it covered in full. To learn more, contact your insurance provider and HSA manager.
Frequently Asked Questions
How can I know if my orthodontic concerns are medical or cosmetic?
For this, you need to first be evaluated by an orthodontist or dentist. Then, you need to see what the guidelines are for your HSA.
Is it hard to use HSA funds for orthodontic treatment?
No, using HSA funds for any approved medical expense is fairly simple. In most cases, the hardest part is finding out whether or not your condition is deemed medical or cosmetic.
Are there limits on how much of my HSA funds can be put towards orthodontic treatment?
No. If needed, you can use all the funds currently in your HSA to cover Invisalign.
How do I reimburse myself if I first pay out of pocket?
This will vary between HSAs. Most have a bill pay portal that allows you to transfer money to linked bank accounts if you submit evidence of a covered expense.
Can I use my HSA if I just changed jobs?
Yes! HSAs belong to you, not your employer. So, if you had one at your old job, it is still yours to use as you need to. Just make sure you continue to meet your eligibility requirements.
What happens if I use my HSA to pay for a non-eligible treatment?
The money will be taxed and you will need to pay a 20 percent fee. This is why it is essential that you verify that your Invisalign treatment is covered before using HSA funds.
How do I know if I have a high-deductible health plan?
The IRS sets the limits for high deductible health plans. For 2021, any plan with a deductible of at least $1,400 for an individual or $2,800 for a family qualifies.
Where can I check my HSA balance?
Typically, this is done online through the company’s portal.
Can HSA funds be used for spouses?
Yes, HSA funds can be used for the account holder as well as their spouse and dependents.