by WEX Benefits
Good news for Americans struggling to manage high healthcare costs: As flexible spending accounts (FSAs) and health savings accounts (HSAs) become more mainstream, they are also getting more convenient to use with every passing year. Along with the rise in the number of Americans on high-deductible health plans (HDHPs), often paired with an HSA or FSA, so too is there a rise in the number of merchants who now accept benefits debit cards as a form of payment. Last year, Amazon began taking HSA/FSA cards, and WEX introduced the Health Shopper, an e-commerce website designed around shopping for HSA- and FSA-eligible items with purchasing and order fulfillment via the Amazon.com shopping experience.
The list of items eligible for purchase with these tax-advantaged accounts also tends to grow by at least a few items each year. Last year, for example, the IRS added a number of medicines and services deemed as preventative care for those with chronic illnesses. More recently, it included certain food allergy sensors, high-tech baby monitors and devices to improve posture.
The IRS also ruled that up to $117 of a health and ancestry service purchase from 23andMe may be eligible for reimbursement, as long as it is being used “for the diagnosis, cure, mitigation, treatment or prevention of disease.” The company sells at-home genetic tests that use saliva to reveal genetic lineage and certain health predispositions. Previously, to be reimbursed for these DNA tests, a Letter of Medical Necessity (LMN) would have been required to prove that the test was being used for medical reasons.
MarketWatch.com is reporting that an increasingly popular way to spend FSA and/or HSA dollars at the moment is on hand sanitizers, medical masks and thermometers (although hand sanitizers and medical masks require an LMN in order to be considered an eligible expense).
Since FSAs are use-or-lose accounts, many FSA participants spend their remaining funds at the end of their plan year on glasses and contacts, ibuprofen, bandages, first-aid kits, sunscreen, vitamins and more.
For a full list of HSA- and FSA-eligible medical expenses, and an explanation of how the IRS determines them, read our blog post.