Does FSA Cover Plastic Surgery? When It’s Eligible

A Flexible Spending Account (FSA) is an employer-sponsored benefit that allows individuals to set aside pre-tax money from their salary to cover qualified out-of-pocket healthcare expenses. This tax advantage reduces an individual’s taxable income, providing savings on federal, state, and Social Security taxes. FSAs are designed to help make healthcare costs more manageable, including deductibles, copayments, and certain medical supplies. Many individuals wonder about the extent of FSA coverage, particularly concerning plastic surgery procedures.

General Rules for FSA Eligibility

All expenses eligible for FSA reimbursement must meet the Internal Revenue Service (IRS) definition of “medical care.” This definition encompasses 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. Expenses incurred solely for general health improvement or cosmetic purposes are typically excluded from this definition. The primary intent of the expense, whether medical or cosmetic, is the determining factor for FSA eligibility, dictating whether a procedure, including plastic surgery, can be covered.

Eligible Plastic Surgery Procedures

Certain plastic surgery procedures can be covered by an FSA if they are deemed medically necessary. This means the surgery’s purpose is to correct a physical defect or disfigurement resulting from a congenital abnormality, personal injury, or a disfiguring disease. For instance, reconstructive surgery performed after a mastectomy for breast cancer is generally considered medically necessary. Similarly, the repair of a cleft palate or scar revision from an accident would qualify for FSA reimbursement, as these procedures aim to restore function or correct a deformity.

Ineligible Plastic Surgery Procedures

Plastic surgery procedures performed purely for cosmetic reasons, without a medical necessity, are generally not eligible for FSA reimbursement. These procedures are intended to improve appearance and do not treat a disease or promote proper bodily function. Common examples include facelifts, liposuction, and breast augmentation performed solely for aesthetic enhancement. Rhinoplasty, or a “nose job,” is also typically ineligible if its primary purpose is cosmetic, rather than to correct a breathing issue or a deformity.

Substantiating Medical Necessity

To claim FSA reimbursement for a plastic surgery procedure, individuals must provide documentation to substantiate its medical necessity. This typically involves obtaining a Letter of Medical Necessity (LMN) from a qualified healthcare provider. The LMN should clearly state the diagnosed medical condition requiring the procedure, describe how the treatment will alleviate the condition, restore function, or correct a disfigurement, and include the specific treatment recommended and its expected duration. FSA administrators may request additional supporting medical records to verify the medical necessity of the procedure before approving the claim.