Americans have long relied on health savings accounts (HSAs) and flexible savings accounts (FSAs) to cover a variety of health and wellness items. However, recent guidance from the IRS has raised concerns about certain companies providing misleading information about eligible expenses.
The issue at hand involves companies offering “letters of medical necessity” to purchase health-related items like gym memberships, fitness trackers, and dietary supplements. While these letters are written by doctors, the IRS questions the validity of their advice, stating that medical letters must result from face-to-face interactions with patients.
Companies that provide these services claim that notes based on self-reported health information can convert non-medical expenses into medical expenses. However, the IRS is pushing back, stating that unless consumers meet strict criteria, they cannot use HSA and FSA funds for general health and wellness items.
This recent development has sparked debate among experts, with some believing that the IRS is overstepping its boundaries and setting unreasonable standards for medical necessity. In particular, the agency's stance on using funds for food, exercise, and other wellness interventions has raised questions about the prioritization of treatment options.
Despite the controversy, the popularity of using HSA and FSA funds for health and wellness products continues to grow. Retailers like Walmart and Target offer a variety of eligible items, and websites like HSA Store promote the use of these funds for products like fitness trackers and massage guns.
While the IRS has published guidelines on eligible expenses, the grey areas remain a point of contention. As consumers navigate these rules, companies like Truemed offer services to help obtain legitimate medical letters for reimbursement. Overall, the debate around HSA and FSA funds underscores the importance of clear guidelines and transparency in healthcare financing.