Does FSA Cover Prescriptions?

Yes, FSA funds can be used to pay for eligible prescription medications. Your Flexible Spending Account covers prescription drugs prescribed by a licensed healthcare provider, including both brand-name and generic medications. You can use your FSA debit card at most pharmacies or submit receipts for reimbursement. However, over-the-counter medications typically require a prescription to be FSA-eligible, with some exceptions like insulin and feminine hygiene products. The IRS sets annual contribution limits at $3,200 for 2024, and unused funds may be forfeited under use-it-or-lose-it rules unless your employer offers a grace period or carryover option.