Can You Use an FSA for Plastic Surgery?

A Flexible Spending Account (FSA) allows employees to set aside pre-tax money from their paycheck to pay for eligible healthcare expenses. This can reduce taxable income, providing a financial benefit for medical, dental, and vision costs. Understanding which expenses qualify for reimbursement is important, especially when considering procedures like plastic surgery. This article clarifies when plastic surgery procedures might be eligible for FSA reimbursement.

IRS Guidelines on Cosmetic vs. Medical Expenses

The Internal Revenue Service (IRS) distinguishes between “medical care” and “cosmetic surgery” for tax purposes, directly influencing FSA eligibility. The IRS generally defines medical care as amounts paid for the diagnosis, cure, mitigation, treatment, or prevention of disease, or for the purpose of affecting any structure or function of the body. This broad definition covers a wide range of health-related services and products.

However, the IRS specifically states that expenses paid for cosmetic surgery or other similar procedures are generally not considered medical expenses. This exclusion applies unless the surgery is necessary to ameliorate a deformity arising from, or directly related to, a congenital abnormality, a personal injury, or a disfiguring disease. Therefore, procedures solely aimed at improving appearance, without a medical necessity, are not eligible for FSA reimbursement.

Qualifying Medically Necessary Procedures

Building upon IRS guidelines, certain plastic surgery procedures can qualify as medically necessary expenses for FSA reimbursement. Reconstructive surgery following a mastectomy, for instance, often qualifies as it addresses a deformity resulting from a disease. Procedures to correct congenital abnormalities, such as a cleft lip or palate, are also typically eligible.

Surgery to repair disfigurement caused by a personal injury, such as from an accident or burn, generally qualifies for FSA reimbursement. Functional rhinoplasty, a nose surgery primarily intended to improve breathing difficulties rather than altering appearance, can be an eligible expense. The determining factor for eligibility is the primary purpose of the procedure: it must treat a medical condition, restore bodily function, or correct a significant physical impairment, not merely enhance one’s looks.

Documentation for FSA Reimbursement

If a plastic surgery procedure is medically necessary, specific documentation is required to support an FSA claim. A Letter of Medical Necessity (LMN) from a physician is essential. This letter must state the diagnosis and explain how the surgery addresses a medical condition.

You will also need documentation containing diagnostic codes. A comprehensive treatment plan outlining the proposed procedure and its expected medical outcomes is important. Detailed itemized bills from the surgeon and facility, showing the services rendered and costs incurred, are also necessary.

Submitting Your FSA Claim

After gathering all necessary documentation, you can submit your FSA claim. Some FSA plans provide a debit card, which can be used at the point of service if the provider accepts it for qualified medical expenses. For reimbursement of out-of-pocket payments, you will need to complete a claim form provided by your FSA administrator.

You must attach all the previously gathered documentation, including the Letter of Medical Necessity and itemized bills, to this claim form. The completed form and supporting documents are then sent to your FSA administrator, often through an online portal, mail, or fax. After submission, the administrator will process the claim, and if approved, reimbursement will be issued via direct deposit or a check.