Where should employees concentrate their FSA contributions?

Non-covered prescription drugs represent 43% of most employees’ out-of-pocket medical expenses, according to a study by the Kaiser Family Foundation. Other top expenses:

• physician office visit co-pays and non-covered services (26%)
• dental care (17%), and
• vision services (9%).

In total, about 35% of employees’ total medical expenses per year are now paid out of pocket.

Further evidence employees with high out-of-pocket expenses should participate in FSAs: Employees in the top 20% for out-of-pocket costs cause 80% of the total medical claims at most organizations.

The top 5% alone account for nearly half (49%) of all medical costs. Per person, the high-risk group of employees spends $7,000 per year; a figure expected to climb to $12,000 by 2015.