Health Care Flexible Spending Accounts (FSA) and Health Savings Accounts (HSA)

While the cost of compression garments and compression bandaging supplies may appear to be expensive, having the right supplies to treat your lymphedema or other medical condition, and maintaining your overall health and lifestyle is priceless! Even if you have health insurance, the annual deductible and co-payment may still create a situation where getting the compression items that you need seem cost-prohibitive. In this situation you need to consider the available alternatives to using insurance for getting your supplies.

One option that might make sense and help you better be able to afford compression garments and bandaging supplies may be that of using a Health Care Flexible Spending Account (FSA) or Health Savings Account (HSA) which allows you to purchase these items using pre-tax dollars.

Health Care Flexible Spending Accounts (FSA) and Health Savings Accounts (HSA)

If insurance coverage is not available, or if the annual deductible and co-payment amount still represent a sizeable out-of-pocket payment, explore using a Health Care Flexible Spending Account (FSA) or Health Savings Account (HSA) to pay for your compression supplies and garments.

Both, a Health Care Flexible Spending Account and Health Savings Account, help you set aside pre-tax dollars to purchase qualified medical expenses. While it may appear confusing, using an FSA or HSA is really quite straightforward and simple, and may make economical sense to help getting the supplies that you need to treat your medical condition.

Here are some frequently asked questions regarding an FSA or HSA and how to use them to purchase medical supplies and garments:

What Is The Difference Between An FSA And HSA Account?

A Health Care Flexible Spending Account (FSA) is an employer-established benefit account allowing you to set aside pre-tax dollars through payroll deductions to cover eligible medical expenses. The unused funds in the FSA are forfeited at the expiration of the current benefit period.

A Health Savings Account (HSA) is a type of savings account that you own and allows you to set aside pre-tax dollars to cover qualified medical expenses. The funds in an HSA can accumulate over time. You can spend the funds, tax-free, on qualifying medical expenses.

What Is The Benefit Of Using An FSA Or HSA To Purchase Needed Medical Supplies?

Both an FSA and HSA allow you to save money on a pre-tax basis for qualified medical expenses, however an HSA is more flexible than an FSA, as it allows you to save and invest your pre-tax funds for future use.

How Do I Use My FSA Or HSA To Make A Purchase?

To use an FSA or HSA to purchase your medical supplies or compression garments, you can:

Check with your FSA/HSA adiministrator to confirm eligibility
Purchase from a company, such as Bandages Plus that accepts FSA and HSA payments
Use your FSA/HAS debit card to pay for the items, or
Pay for the items directly and submit receipts to your administrator for reimbursement
Keep all relevant documentation to support your purchase

Who Determines Which Medical-Related Items Are Eligible?

SIGIS (Special Interest Group for IIAS Standards) has developed a list of health care over-the-counter items and other services that are considered eligible under the Internal Revenue Code to determine whether a product or service does or does not qualify as a medical expense and therefore may be purchased using your FSA/HSA account. This list is known as the Eligible Products List for IIAS Approval.

How Do I Know If The Items I Want To Purchase Qualify For My FSA or HSA Account?

Eligible items and supplies can be purchased with FSA and HSA funds if they meet certain criteria:

Must be for medical care or products, and are primarily for a medical purpose. This includes products with or without a prescription that diagnose, alleviate or treat existing or imminent injuries, illnesses or medical conditions, or are used in the prevention of a disease, or for the purpose of affecting the structure or function of the body.
The expense incurred would not have been paid “but for” the disease or illness that it will help treat.
Garments and supplies qualify if the primary purpose of the product is for medical care, and it is not intended for “normal” or general health use that is not a medical necessity.

What Medical Conditions Qualify For Using My FSA or HSA Account?

The following are some examples of health issues that qualify as a medical condition that are subject to eligibility for using an FSA or HSA account:

lymphedema
edema
deep vein thrombosis (DVT)
diabetic leg ulcers
venous insufficiency
varicose veins

What Are Examples Of Qualifying Items Or Medical Expenses?

Although not comprehensive, the following is a list of some examples of qualifying items or medical expenses for using your FSA or HSA account:

Compression Garments:

Medical grade compression garments 30-40 and above
Compression garments of any compression that treat condition-specific medical conditions such as:

lymphedema
chronic venous insufficiency
deep vein thrombosis (DVT)
embolism
leg ulcers
plantar fasciitis

First Aid Dressings and Wound Care Supplies:

Items which protect and treat wounds, such as:

saline wound washes
bandages and wound dressings
tapes and bandages (unless marketed as performance enhancing)

Health Supports

Medium and long stretch elastic bandages
Orthopedic supports
Abdominal supports
Athletic tape (unless marketed solely for performance enhancements)

What Types Of Expenses Do Not Qualify For My FSA Or HSA Account?

In general, the following types of expenses are not eligible for use with your FSA or HSA account:

Any expense that you would have paid regardless of an existing medical condition
Any expense that is cosmetic or is merely beneficial to your general health, or personal hygiene

What If The Item I Want To Purchase May Be Considered Either, A Medical Necessity Or Non-Medical Necessity?

Dual-purpose items are products that may have both a medical purpose as well as a personal hygiene, cosmetic or general health purpose. To qualify as a medical expense (i.e., may be purchased with an FSA or HSA account), these types of items must treat a medical condition and cannot be used to improve or maintain general health unless prescribed by a licensed health care professional to treat a specific illness, condition or injury.

Do I Need A Prescription For My Purchase?

You do not need to provide a statement from a medical provider or indicate a diagnosis in order to receive reimbursement as long as the item is on the Eligible Products List for IIAS Approval.

What If I Am Still Unsure Whether My Item Qualifies?

If you are not sure, or simply want to ensure your compression garments or bandaging supplies are eligible for reimbursement, you'll need to provide a prescription from a healthcare practitioner. This prescription should indicate the medical necessity of the item, such as for conditions like chronic venous insufficiency, lymphedema, or deep vein thrombosis prevention, etc.