Does an FSA Cover Hearing Aids and Related Costs?

Flexible Spending Accounts (FSAs) allow individuals to pay for eligible healthcare expenses with pre-tax dollars, reducing taxable income. These employer-sponsored benefits let individuals set aside a portion of their salary to cover medical costs throughout the plan year. Understanding which expenses qualify for reimbursement is important for maximizing FSA benefits, especially for significant health-related purchases. This article clarifies whether hearing aids and their associated costs are covered by an FSA.

FSA Coverage for Hearing Aids

Hearing aids are eligible medical expenses for FSA reimbursement, as classified by the Internal Revenue Service (IRS). The IRS considers hearing aids medical devices used for diagnosis, cure, mitigation, treatment, or prevention of disease, or for affecting any structure or function of the body. The cost of the hearing aid device itself qualifies for FSA funds.

This eligibility extends to both prescription and over-the-counter hearing aids, following a 2022 IRS announcement. Using an FSA for hearing aids allows individuals to leverage pre-tax savings.

Specific Eligible Expenses

Beyond the hearing aid device, a range of related items and services also qualify for FSA reimbursement. These include:
Hearing aid batteries
Costs associated with repairs and maintenance for hearing aids, including cleaning solutions and storage cases
Replacement parts and earmolds
Audiology exams conducted for diagnosing hearing loss or for the proper fitting of hearing aids
Certain hearing aid accessories directly related to the device’s function, such as specialized cords or telecoils

Using Your FSA Funds

Accessing FSA funds for hearing aid expenses involves two methods: using an FSA debit card or submitting a claim for reimbursement. Many FSA plans provide a debit card for eligible medical expenses, usable directly at the point of sale with healthcare providers or merchants.

If a debit card is not available or accepted, individuals can pay out-of-pocket and submit a claim for reimbursement. This process requires detailed documentation, including itemized receipts that clearly show the date of service, the provider’s name, a description of the service or item, and the amount paid. For services processed through insurance, an Explanation of Benefits (EOB) form is often required. It is important to retain all receipts and documentation as proof of medical necessity, as the IRS requires substantiation for FSA card transactions.

Key FSA Rules

Flexible Spending Accounts are subject to specific rules. A primary rule is the “use it or lose it” provision, meaning funds must be used within the plan year or they will be forfeited. Many employers offer options to mitigate this rule, such as a grace period, which allows an extension of up to 2.5 months after the plan year ends to incur new expenses.

Alternatively, some plans offer a carryover option, permitting a limited amount of unused funds, such as up to $660 for 2025, to roll over into the next plan year. Employers typically offer either a grace period or a carryover, but not both. While hearing aids are medical devices, some accessories or specific situations may necessitate a doctor’s prescription or a Letter of Medical Necessity for FSA eligibility. Always review your specific FSA plan documents, as rules and eligible expenses can vary between administrators.