Can I use a Lifestyle Spending Account (LSA) for postnatal care?

As a new parent, you want to ensure you have the support and resources necessary to navigate the challenges of postnatal care.

One option that may be available to you is a Lifestyle Spending Account (LSA) provided by your employer.

But what exactly is an LSA, and can it be used to cover expenses related to postnatal care? Let's explore the ins and outs of this valuable benefit.

What is a Lifestyle Spending Account (LSA)?

A Lifestyle Spending Account is an employer-funded benefit designed to support the overall well-being of employees. LSAs provide a set amount of funds that can be used to pay for a wide variety of wellness-related expenses, including those associated with postnatal care.

The specific expenses covered by an LSA can vary depending on the employer's plan, but they generally encompass a broad range of categories that promote physical, mental, and emotional health.

Examples of LSA-eligible expenses

LSAs can cover a diverse array of wellness expenses, such as:

• Fitness memberships and classes
• Nutritional counseling and meal planning services
• Stress management programs
• Mental health support, like therapy or counseling
• Childcare or dependent care assistance
• Postnatal services, such as lactation consultations or postpartum doula support

The flexibility of LSAs allows you to choose the services and resources that best suit your individual needs and preferences.

How LSAs differ from other benefits like FSAs and HSAs

While LSAs, Flexible Spending Accounts (FSAs), and Health Savings Accounts (HSAs) all provide a way to pay for health-related expenses, there are some key differences.

FSAs and HSAs are typically used to cover medical expenses, such as doctor visits, prescription medications, and medical equipment. These accounts are also subject to specific IRS regulations and restrictions.

In contrast, LSAs are designed to support a broader definition of wellness and are not limited to strictly medical expenses. They offer more flexibility in terms of eligible expenses and are not subject to the same IRS rules as FSAs and HSAs.

Another difference is that LSA funds are provided entirely by the employer, whereas FSAs and HSAs may involve employee contributions. LSA funds are also generally considered taxable income, while FSA and HSA contributions can be made on a pre-tax basis.

Benefits of using an LSA for postnatal care

Using an LSA to cover postnatal care expenses offers several advantages for both you and your employer. One of the most significant benefits is the flexibility to choose the services and providers that best meet your needs.

With an LSA, you have the freedom to select the specific types of postnatal support you want, whether that's lactation consulting, postpartum doula services, or mental health counseling. This allows you to tailor your care to your unique situation and preferences.

Employers also benefit from offering LSAs for postnatal care. By providing this type of comprehensive support, companies can improve employee well-being and increase retention rates. When you feel supported and valued by your employer during the challenging postnatal period, you're more likely to remain loyal to the organization and return to work with a positive outlook.

Tax advantages for employers

In addition to boosting employee satisfaction and retention, LSAs can also provide tax advantages for employers. While the specifics may vary depending on the jurisdiction and the structure of the plan, employers may be able to deduct the cost of LSA contributions as a business expense. This can help offset the expense of providing this valuable benefit to employees.

Attracting top talent with comprehensive benefits

Offering an LSA that covers postnatal care can also help companies attract top talent. In today's competitive job market, candidates are increasingly looking for employers that offer comprehensive benefits packages that support their overall well-being.

By including postnatal care in your LSA, you demonstrate a commitment to supporting employees during a critical life stage, which can set your company apart from others and make it a more attractive place to work.

Ultimately, using an LSA for postnatal care can have far-reaching benefits for both you and your employer. It provides you with the flexibility and support you need during a challenging time while also helping your company foster a positive, inclusive work environment that values employee well-being.

How does an LSA work for postnatal expenses?

When it comes to using your LSA for postnatal care, the process is relatively straightforward. Your employer will determine which specific expenses are eligible for reimbursement under the plan. This may include services such as lactation consulting, postpartum doula support, or even certain baby gear and supplies.

Employer determines eligible expenses and contribution amounts

Your employer will also set the contribution amounts for your LSA. This is the total amount of money available to you for reimbursement of eligible expenses. Contribution amounts can vary depending on factors such as your position within the company, length of employment, or other criteria determined by your employer.

Employees submit claims for reimbursement

To use your LSA funds for postnatal expenses, you'll need to submit a claim for reimbursement. This typically involves providing documentation of the expense, such as a receipt or invoice, along with any necessary forms or paperwork required by your employer.

Once your claim is submitted, it will be reviewed to ensure that the expense is eligible under your LSA plan. If approved, you'll receive reimbursement for the cost of the service or item, up to the available balance in your LSA.

Options for rollover or "use it or lose it" policies

It's important to note that LSA plans can vary in terms of how funds are handled at the end of the plan year. Some employers may allow you to roll over unused funds to the next year, while others may have a "use it or lose it" policy, meaning that any unspent money will be forfeited at the end of the year.

Be sure to familiarize yourself with your company's specific LSA policies so that you can make the most of your available funds and avoid losing any money that could be used to support your postnatal care needs.

What types of postnatal expenses are typically covered by LSAs?

LSAs can cover a wide range of postnatal expenses that support your physical and emotional well-being during the postpartum period. While the specific expenses eligible for reimbursement may vary depending on your employer's plan, here are some common categories of postnatal care that are often covered by LSAs.

Postpartum doula services

Postpartum doulas provide invaluable support to new parents as they navigate the challenges of life with a newborn. These trained professionals can offer guidance on everything from infant care and feeding to emotional support and household management.

Many LSAs cover the cost of postpartum doula services, allowing you to access this important resource without the added financial strain.

Meal delivery or grocery stipends

Proper nutrition is essential for postpartum recovery and breastfeeding, but finding the time and energy to prepare healthy meals can be a challenge with a new baby at home.

Some LSAs offer reimbursement for meal delivery services or grocery stipends, making it easier for you to access nourishing food during this demanding time.

Mental health support (therapy, meditation apps)

The postpartum period can be an emotionally challenging time, and many new parents experience symptoms of depression, anxiety, or other mental health concerns.

LSAs often cover expenses related to mental health support, such as therapy sessions with a licensed provider or subscriptions to meditation and mindfulness apps that can help you manage stress and maintain emotional well-being.

Fitness classes or equipment for postpartum recovery

Engaging in gentle, appropriate exercise can be beneficial for postpartum recovery, helping to strengthen your body and improve your overall sense of well-being.

Many LSAs cover the cost of fitness classes specifically designed for postpartum individuals, such as postnatal yoga or Pilates. Some plans may also reimburse you for the purchase of home fitness equipment, like resistance bands or exercise balls, that can be used for postpartum recovery workouts.

Lactation consulting and supplies

For those who choose to breastfeed, having access to professional lactation support can make a significant difference in your success and comfort with the process.

LSAs often cover the cost of lactation consulting services, whether in-person or virtual, to help you establish and maintain a healthy breastfeeding relationship with your baby. Some plans may also reimburse you for the purchase of breastfeeding supplies, such as nursing pillows, breast pumps, or milk storage containers.

By covering these various aspects of postnatal care, LSAs provide a comprehensive support system for new parents during a time when self-care and recovery are paramount. Be sure to explore the specific postnatal expenses eligible under your employer's LSA plan to maximize the benefits available to you.

How to maximize your LSA for postnatal care

To get the most out of your LSA for postnatal expenses, it's important to understand your employer's specific plan details and prioritize your spending based on your unique needs.

Review your employer's specific plan details

Start by carefully reviewing your employer's LSA plan documents to familiarize yourself with the eligible expenses, contribution limits, and any deadlines for submitting claims. This will help you create a plan for using your LSA funds in a way that aligns with your postnatal care priorities.

Prioritize expenses based on your unique needs

Consider your individual circumstances and prioritize the postnatal expenses that will have the greatest impact on your well-being. For example, if you're struggling with breastfeeding, you may want to prioritize lactation consulting services. If you're experiencing symptoms of postpartum depression, mental health support may be your top priority.

Keep detailed records and submit claims promptly

To ensure smooth reimbursement of your postnatal expenses, keep detailed records of all eligible purchases, including receipts, invoices, and any necessary documentation from healthcare providers. Submit your claims promptly to avoid missing any deadlines and to ensure you have access to your reimbursed funds as soon as possible.

Coordinate with other benefits like FSAs or HSAs

If you have access to other benefits like Flexible Spending Accounts (FSAs) or Health Savings Accounts (HSAs) , coordinate your postnatal expenses across these different accounts to maximize your savings and ensure you're using each account for its intended purpose. For example, you may want to use your FSA for medical expenses like prenatal vitamins or postpartum check-ups, while reserving your LSA for wellness expenses like postpartum doula services or fitness classes.

By taking a strategic approach to your LSA spending and coordinating with your other benefits, you can create a comprehensive support system for your postnatal care needs, ensuring a smoother transition into parenthood and a greater sense of overall well-being during this transformative time.

Is an LSA the best way to cover postnatal expenses?

While an LSA can be a valuable tool for covering postnatal care expenses, it's important to consider other benefit options that may be available to you, such as Flexible Spending Accounts (FSAs), Health Savings Accounts (HSAs), and Health Reimbursement Arrangements (HRAs).

FSAs and HSAs are tax-advantaged accounts that allow you to set aside pre-tax dollars for qualified medical expenses. This means that you can save money on taxes while paying for eligible postnatal care costs. However, these accounts have specific eligibility requirements and contribution limits set by the IRS.

HRAs, on the other hand, are employer-funded accounts that reimburse you for qualified medical expenses. Like LSAs, HRAs are entirely funded by your employer, but they are specifically designed for medical costs and may have more restrictions on eligible expenses.

When deciding whether an LSA is the best option for your postnatal care needs, consider factors such as:

1. Tax implications: LSA funds are generally considered taxable income, while FSA and HSA contributions are made on a pre-tax basis.
2. Flexibility: LSAs typically offer more flexibility in terms of eligible expenses, covering a broader range of wellness-related costs beyond strictly medical expenses.
3. Rollover options: Some LSAs may allow you to roll over unused funds to the next year, while FSAs and HRAs often have "use it or lose it" policies.
4. Coordination with other benefits: Consider how an LSA would work in conjunction with your other health benefits, such as health insurance, to ensure you're maximizing your coverage and savings.

Understanding the pros and cons of Lifestyle Spending Accounts can help you make an informed decision about whether this benefit is the best fit for your postnatal care needs.

Ultimately, the best way to cover postnatal expenses will depend on your unique circumstances, including your available benefits, tax situation, and specific care needs. Review your employer's benefit offerings and consult with your HR representative or a financial advisor to determine the most advantageous approach for you and your family.

5 tips for implementing an LSA program that supports new parents

As an employer, you have the power to create an LSA program that truly supports the unique needs of new parents in your workforce. Here are five tips to help you design and implement an effective LSA for postnatal care:

Survey employees to identify top postnatal needs

To ensure your LSA program addresses the most pressing concerns of new parents, conduct a survey to gather insights on their specific postnatal needs. This feedback will help you prioritize the eligible expenses and services that will have the greatest impact on your employees' well-being.

Offer generous contribution amounts for meaningful impact

When determining the contribution amounts for your LSA, consider offering a substantial sum that can make a real difference in your employees' postnatal journey. Generous contributions demonstrate your commitment to supporting new parents and can help alleviate the financial stress often associated with this life stage.

Provide clear guidance on eligible expenses and claims process

To maximize utilization of the LSA benefit, provide clear, easy-to-understand guidance on eligible postnatal expenses and the claims submission process. Create a comprehensive list of covered services and items, and offer step-by-step instructions for submitting claims to ensure a smooth experience for your employees.

Communicate the benefit regularly to boost awareness and utilization

Regularly communicate the availability and value of the LSA benefit to your employees, particularly those who are expecting or have recently become parents. Use various channels, such as email, company intranet, and employee forums, to raise awareness and encourage utilization of this valuable resource.

Gather feedback and adjust the program as needed

As with any employee benefit, it's important to gather feedback from your team members to assess the effectiveness of your LSA program. Regularly survey participants to understand how well the benefit is meeting their postnatal needs and identify areas for improvement. Use this feedback to make data-driven adjustments to your LSA, ensuring it continues to provide meaningful support for new parents in your organization.

By following these tips, you can create an LSA program that not only supports the well-being of new parents but also fosters a culture of empathy, inclusivity, and work-life balance within your organization. LSAs offer a range of benefits for both employers and employees, making them a valuable tool for attracting and retaining top talent in today's competitive job market.

A Lifestyle Spending Account (LSA) can provide flexible support for postnatal care, covering services like lactation consulting, postpartum doulas, and mental health resources. Forma helps employers design LSAs that support new parents while simplifying benefit administration. Schedule a consultation with one of our experts today.