Medical Expenses Questions Addressed

The IRS has addressed questions about medical expenses related to nutrition,
wellness, and general health.

You may be wondering whether certain costs related to nutrition, wellness, and general health are medical expenses under section 213 of the Internal Revenue Code (Code) that may be paid or reimbursed under a health savings account (HSA), health flexible spending arrangement (FSA), Archer medical savings account (Archer MSA), or health reimbursement arrangement (HRA). This article addresses some of those questions.

The IRS has addressed these issues as part of the National Strategy on Hunger, Nutrition and Health. The National Strategy provides a roadmap of actions the federal government will take to end hunger and reduce diet-related diseases by 2030.

Generally, a deduction is allowed for expenses paid during the taxable year for medical care if certain requirements are met. Alternatively, medical expenses are eligible to be paid or reimbursed under an HSA, FSA, Archer MSA or HRA.

Medical expenses are the costs of diagnosis, cure, mitigation, treatment, or prevention of disease, and for the purpose of affecting any part or function of the body. These expenses include payments for legal medical services rendered by physicians, surgeons, dentists, and other medical practitioners. They include the costs of equipment, supplies, and diagnostic devices needed for these purposes. They also include the costs of medicines and drugs that are prescribed by a physician.

Medical expenses must be primarily to alleviate or prevent a physical or mental disability or illness. They don’t include expenses that are merely beneficial to general health.

Questions arise as to whether the cost of nutritional counseling, weight-loss programs, gym memberships, and treatment for substance use disorders are considered medical expenses that may be paid or reimbursed under an HSA, FSA, Archer MSA or HRA.

Here are a few of the questions and answers recently published by the IRS regarding payment or reimbursement by an HSA, FSA, Archer MSA, or HRA:

Is the cost of nutritional counseling a medical expense that can be paid or reimbursed by an HSA, FSA, Archer MSA, or HRA?

Yes, but only if the nutritional counseling treats a specific disease diagnosed by a physician (such as obesity or diabetes). Otherwise, the cost of nutritional counseling is not a medical expense.

Is the cost of a weight-loss program a medical expense that can be paid or reimbursed by an HSA, FSA, Archer MSA, or HRA?

Yes, but only if the program treats a specific disease diagnosed by a physician (such as obesity, diabetes, hypertension, or heart disease). Otherwise, the cost of a weight-loss program is not a medical expense.

Is the cost of food or beverages purchased for weight loss or other health reasons a medical expense that can be paid or reimbursed by an HSA, FSA, Archer MSA, or HRA?

Yes, but only if (1) the food or beverage doesn’t satisfy normal nutritional needs, (2) the food or beverage alleviates or treats an illness, and (3) the need for the food or beverage is substantiated by a physician. The medical expense is limited to the amount by which the cost of the food or beverage exceeds the cost of a product that satisfies normal nutritional needs. If any of the three requirements is not met, the cost of food or beverages is not a medical expense.

Is the cost of nutritional supplements a medical expense that can be paid or reimbursed by an HSA, FSA, Archer MSA, or HRA?

Yes, but only if the supplements are recommended by a medical practitioner as treatment for a specific medical condition diagnosed by a physician. Otherwise, the cost of nutritional supplements is not a medical expense.

Is the cost of a gym membership a medical expense that can be paid or reimbursed by an HSA, FSA, Archer MSA, or HRA?

Yes, but only if the membership was purchased for the sole purpose of affecting a structure or function of the body (such as a prescribed plan for physical therapy to treat an injury) or the sole purpose of treating a specific disease diagnosed by a physician (such as obesity, hypertension, or heart disease). Otherwise, the cost of a gym membership is for the general health of the individual and is not a medical expense.

Is the cost of exercise for the improvement of general health, such as swimming or dancing lessons, a medical expense that can be paid or reimbursed by an HSA, FSA, Archer MSA, or HRA?

No, because the exercise, even if recommended by a doctor, is only for the improvement of general health.

Is the cost of therapy a medical expense that can be paid or reimbursed by an HSA, FSA, Archer MSA, or HRA?

Yes, if the therapy is treatment for a disease. For example, an amount paid for therapy to treat a diagnosed mental illness is a medical expense, but an amount paid for marital counseling is not.

Is the cost of a program to treat a drug-related substance use disorder a medical expense that can be paid or reimbursed by an HSA, FSA, Archer MSA, or HRA?

Yes, because the program treats a disease (substance use disorder).

A Final Note

For more details about whether costs related to nutrition, wellness and general health are medical expenses, seePublication 502, Medical and Dental Expenses, and Tax Topic 502, Medical and Dental Expenses.

For more information about tax-favored health plans, contact your tax professional.

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