Health Care Reimbursement Account

This year I opened a health care reimbursement account for the first time. These accounts let you pay for health care expenses such as doctor visits, dentist and eye care expenses with pretax dollars.

This is my first time with an HCR account so I started with a modest amount - $260 or $10 per pay period.

After enrolling I received what is esentially a debit card with a $260 balance that you use to pay for an allowable medical expenses. Each plan has different allowable expenses, so if this is something you are considering check with your HR department and read the literature they have available.

Because you pay pretax a HCR can be a great way to reduce the cost of medical expenses - so long as you can make a reasonable prediction of your yearly medical expenses. However, HCR plans are use it or lose it style plans, so if you don't spend as much as you thought you were going to there is no way to get the money back. This can also lead to people getting a lot of optional things (prescrition sunglasses, extra boxes of contacts, preemptive wisdom teeth extraction etc) in December rather then just lose the money.

I used it for the first time yesterday, charging a $20 co pay for an eye exam so I have roughly 7 and a half months to use the remaining $240 or I'll be one of those people ordering things I don't really need just so I don't completely lose the money I paid into the account.

Does anyone have more experience with a HCR account, or have any good tips for what to spend the money on if you have extra at the end of the year?