IRS FAQs Address Medical Expenses Related to Nutrition, Wellness and General Health

On March 17, 2023, the IRS published new frequently asked questions (FAQs) that address whether certain costs related to nutrition, wellness and general health, such as nutritional counseling, weight-loss programs, and mental health-related therapies, are medical expenses that may be paid or reimbursed under a HSA, health FSA, Archer MSA or HRA.

As background, IRC Code 213 defines the eligible expenses under a HSA, health FSA, Archer MSA or HRA. Code 213 defines eligible expenses as medical expenses that are the costs of the diagnosis, cure, mitigation, treatment, or prevention of disease and for the purpose of affecting any part or function of the body. Further, medical expenses must be primarily to alleviate or prevent a physical or mental disability or illness and not merely used to benefit general health.

The FAQs confirm whether the below services and items can be reimbursed by a HSA, health FSA, Archer MSA or HRA.

• Dental, eye and physical exams: Yes, because these exams diagnose whether a disease or illness is present.
• Smoking cessation programs: Yes, because it treats a disease.
• Program to treat a drug-related substance use disorder: Yes, because it treats a disease.
• Therapy: Yes, if the therapy is a treatment for a disease (e.g., to treat a diagnosed mental illness). Otherwise, it is not eligible (e.g., marital counseling).
• Nutritional counseling: Yes, but only if the nutritional counseling treats a specific disease diagnosed by a physician (e.g., obesity or diabetes).
• Weight-loss program: Yes, only if the program treats a specific disease diagnosed by a physician (e.g., obesity, diabetes, hypertension or heart disease).
• Food or beverages purchased for weight loss or other health reasons: Yes, but only if it meets certain requirements.
• Gym membership: Yes, only if the membership was purchased strictly for the purpose of affecting a structure or function of the body (e.g., a prescribed plan for physical therapy to treat an injury) or for the sole purpose of treating a specific disease diagnosed by a physician (e.g., obesity, hypertension or heart disease).
• Nutritional supplements: Yes, but only if the nutritional supplements are recommended by a medical practitioner as treatment for a specific medical condition diagnosed by a physician.

Though these FAQs do not introduce new rules, they are helpful reminders to employers as they educate their employees on the eligible expenses under their HSA, health FSA, Archer MSA or HRA plans. Further, these FAQs remind employers and cafeteria plan administrators of the importance of obtaining sufficient and appropriate substantiation before reimbursing claims.

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