Does FSA Cover Humidifiers? What You Need to Know

Flexible Spending Accounts (FSAs) offer a valuable benefit, allowing individuals to set aside pre-tax dollars from their paycheck to cover qualified medical expenses. Understanding which expenses qualify for reimbursement through an FSA is essential for maximizing this benefit and managing personal finances effectively.

Understanding Humidifier Coverage

Humidifiers are generally not considered eligible expenses for Flexible Spending Accounts unless they are deemed medically necessary. These devices typically fall under the category of general health and comfort items, which are not covered by FSA guidelines for routine use. However, if a humidifier is specifically recommended by a healthcare provider to treat or mitigate a diagnosed medical condition, it may then qualify for reimbursement.

Medical necessity in this context means the humidifier is primarily for the diagnosis, cure, mitigation, treatment, or prevention of a disease, or for affecting any part or function of the body. For instance, a humidifier could be considered medically necessary for conditions such as asthma, severe allergies, chronic dry skin, or respiratory infections where increased humidity is part of a prescribed treatment plan.

Documentation and Reimbursement Process

To seek reimbursement for a humidifier through your FSA, comprehensive documentation of its medical necessity is required. This typically involves obtaining a Letter of Medical Necessity (LMN) or a prescription from a licensed healthcare provider. This letter serves as official certification that the humidifier is an integral part of treating a specific medical condition, rather than for general health improvement.

The LMN should contain specific details, including the patient’s diagnosed medical condition, a clear description of why the humidifier is needed for treatment, and the anticipated duration of its use. It must be signed by the healthcare provider who made the recommendation. In addition to the LMN, you will need an itemized receipt for the humidifier purchase, clearly showing the date of purchase, the vendor, and the cost. Both the LMN and the itemized receipt must be submitted to your FSA administrator, often through an online portal, mail, or fax, to process the reimbursement claim.

General FSA Principles

Flexible Spending Accounts operate under specific rules established by the Internal Revenue Service (IRS), which impact how funds must be managed. A prominent rule is the “use-it-or-lose-it” provision, meaning any unspent funds remaining in your FSA at the end of the plan year are typically forfeited. This rule underscores the importance of carefully estimating your annual healthcare expenses when determining your FSA contribution.

However, many employers offer exceptions to this rule, such as a grace period or a carryover option, though not both. A grace period can provide up to an additional 2.5 months after the plan year ends to incur and use remaining FSA funds. Alternatively, some plans allow a limited amount of unused funds to be carried over into the next plan year; for example, the IRS permitted a carryover of up to $640 for 2024, with this amount subject to annual adjustments. It is important to confirm with your specific FSA administrator which, if any, of these options your plan offers to avoid losing your pre-tax contributions.