CPB Certified Professional Biller Certification Practice Exam 2026 - Free CPB Practice Questions and Study Guide

In the context of healthcare billing, FSA stands for Flexible Spending Account. This is a type of savings account that allows employees to set aside pre-tax earnings to pay for eligible healthcare expenses. The key advantage of an FSA is that it enables individuals to reduce their taxable income while providing a way to budget for out-of-pocket healthcare costs throughout the year.

Funds deposited into an FSA can typically be used for a variety of medical expenses, including copayments, deductibles, and some other health-related costs. Importantly, the money contributed to an FSA must be used within the plan year, as unspent funds generally cannot be rolled over to the next year, although some plans may allow a small amount of carryover or a grace period.

Recognizing the correct definition of FSA is crucial for understanding healthcare financial management and for assisting patients or clients in navigating their healthcare expenses efficiently. Understanding this can help billers ensure accurate handling of claims and patient inquiries related to the use of flexible spending accounts.