My wife and I each contributed the maximum amount to Flexible Spending Accounts through our respective jobs. By doing it that way, even though insurance didn't cover the procedure, the dollars spent were completely tax free. When you open a flexible spending account, you agree to contribute a specific amount (up to $5000) over the course of the calendar year. If, for example, you get paid 26 times each year and your FSA is for $5000, $192.31 is held out of each check, pre-tax. Because you are being taxed on fewer dollars, your take home pay doesn't actually decrease by $192.31. Additionally, if you've agreed to contribute 5k over the course of the year, and you turn in a bill or a receipt for 5k for a procedure that has been performed -- for example on January 20 -- you get reimbursed within 2 weeks for the entire amount. You have access to the entire amount from day 1 of the year, even though you won't have contributed enough to cover it until the end of the year. Here's an IRS link: http://www.irs.gov/publications/p969/ar02.html#d0e1967. And yes, it works if you have surgery in Mexico -- and you can also use it to pay for fills.