Ask Christina: Can I Use My Debit Card FSA to Pay in Cash?

Health, Managing Health Insurance
Ask Christina

By NerdWallet Health health finance expert Christina LaMontagne

Question:

I have a Flexible Spending Account that uses a debit card, but some of the health services I want to use my FSA funds on don’t accept debit or credit cards. My daughter’s tutor, who specializes in children with ADHD diagnoses, prefers cash. Are there alternative methods for accessing the money that’s set aside in my FSA?

Answer:

FSA accounts are commonly attached to debit cards. In most situations this makes your funds easier to access, but when the health care provider you wish to use doesn’t accept debit payments, it can be an inconvenience. Fortunately, there are usually a few alternatives.

If the health care provider, like your daughter’s tutor, operates independently, you may ask if he or she would consider using PayPal or another online option. This would allow the provider to accept your debit payment without needing any additional equipment, though these services do charge fees for use and may ultimately delay payment.

Depending on the insurance company holding your FSA, you could also pay using cash or check and then file a traditional claim. Simply ask for an itemized receipt from your provider and go online or call your insurance company to ask about the manual claims process. I recommend you retain all of your receipts for FSA purchases, whether debited or not, in case you have to substantiate later on that they were for qualifying goods and services.

Though most service providers in the health care industry will accept debit card payments, there are always exceptions. Insurance companies recognize this and are accommodating for customers who must file claims manually or find alternative methods.