The IRS has issued FAQs that specify when sure prices associated to diet, wellness, and common well being are medical bills below Code § 213 which may be paid or reimbursed below a well being FSA, HSA, or HRA. As background, Code § 213 defines medical care as quantities paid for the analysis, treatment, mitigation, therapy, or prevention of illness, or for the aim of affecting a construction or perform of the physique. The FAQs clarify that medical bills should be primarily to alleviate or stop a bodily or psychological incapacity or sickness, and don’t embody bills which are merely useful to common well being.

The FAQs verify that the prices of dental, eye, and bodily exams are medical bills that may be paid or reimbursed by a well being FSA, HSA, or HRA as a result of these exams diagnose whether or not a illness or sickness is current. The prices of smoking cessation applications and applications that deal with drug-related substance use or alcohol use problems are additionally medical bills as a result of they deal with a illness. For the price of remedy to be a medical expense, the remedy should deal with a illness—thus, quantities paid for remedy to deal with a identified psychological sickness are medical bills, whereas quantities paid for marital counseling aren’t. Likewise, the prices of dietary counseling and weight-loss applications are medical bills provided that the counseling or program treats a selected illness identified by a doctor (e.g., weight problems or diabetes); in any other case, these prices aren’t medical bills. The price of a health club membership is a medical expense provided that the membership was bought for the only real objective of affecting a construction or perform of the physique (e.g., a prescribed plan for bodily remedy to deal with an harm) or treating a selected illness identified by a doctor (e.g., weight problems or coronary heart illness). Nonetheless, the price of train for the development of common well being just isn’t a medical expense, even when really useful by a health care provider.

The FAQs additionally clarify the circumstances below which the price of meals or drinks bought for weight reduction or different well being causes will qualify as medical bills, and that the price of non-prescription medicine could be paid or reimbursed by a well being FSA, HSA, or HRA although this stuff (aside from insulin) aren’t deductible below Code § 213. The FAQs verify that the price of dietary dietary supplements just isn’t a medical expense until the dietary supplements are really useful by a medical practitioner as therapy for a selected medical situation identified by a doctor.

EBIA Remark: These FAQs don’t break new floor or embody any surprises. Nonetheless, they might be useful to these on the “entrance traces” of cafeteria plan administration, who’re typically requested to clarify the explanations for plan working guidelines and selections. In addition they remind directors of the significance of acquiring enough and acceptable substantiation earlier than reimbursing claims and spotlight the challenges concerned with sure bills. For extra info, see EBIA’s Cafeteria Plans handbook at Sections XX.D (“Bills Reimbursed Should Be for Medical Care”), XX.L (“Well being FSA Bills That Are Troublesome to Administer”), and XX.M (“Desk of Frequent Bills, Exhibiting Whether or not They Are for ‘Medical Care’”). See additionally EBIA’s Shopper-Pushed Well being Care handbook at Sections XV.C (“What Is an HSA-Certified Medical Expense?”) and XXIV.B (“HRAs Could Reimburse Solely Code § 213(d) Bills”).

Contributing Editors: EBIA Employees.