Is Microneedling an HSA-Eligible Expense?
Uncover the conditions under which microneedling qualifies as an HSA-eligible medical expense and the necessary steps for coverage.
Health Savings Accounts (HSAs) offer a tax-advantaged way to save and pay for qualified medical expenses. Microneedling, a procedure that involves creating tiny punctures in the skin, has gained popularity for various skin concerns. This article addresses whether microneedling can be considered an HSA-eligible expense.
Understanding HSA-Eligible Expenses
For an expense to qualify for HSA reimbursement, it must meet the Internal Revenue Service (IRS) definition of a “qualified medical expense.” According to IRS Publication 502, these are costs 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 ensures that a wide array of healthcare services and products can be covered. However, expenses incurred solely for cosmetic purposes, aimed at improving appearance without addressing a medical condition, are generally not considered qualified medical expenses.
The IRS specifically excludes procedures that are not medically necessary and are performed purely for aesthetic enhancement. If a procedure is directed at improving a patient’s appearance and does not meaningfully promote the proper function of the body or prevent or treat illness or disease, it typically falls outside the scope of HSA coverage.
When Microneedling Qualifies as a Medical Expense
Microneedling can be an HSA-eligible expense, but only when performed to treat a specific medical condition or disease, rather than for cosmetic improvement alone. The procedure must address a health-related purpose to meet IRS criteria. For instance, microneedling may qualify if prescribed by a physician as a medical treatment for severe acne scarring, scarring resulting from an injury or surgery, or certain dermatological conditions.
While using microneedling to reduce fine lines or improve skin texture for purely aesthetic reasons would not be eligible, its use for conditions like significant scarring from past acne or trauma could be. The medical necessity must be established and documented by a qualified healthcare provider. Without a direct link to the diagnosis, cure, mitigation, treatment, or prevention of a disease, microneedling remains a cosmetic procedure ineligible for HSA funds.
Required Documentation for Reimbursement
To claim microneedling as an HSA expense, specific documentation is required to substantiate its medical necessity. A Letter of Medical Necessity (LMN) from a qualified healthcare provider, such as a dermatologist, is important. This letter must outline the patient’s diagnosed medical condition and explain how the microneedling procedure is medically necessary to treat or alleviate that condition. It should detail the recommended treatment plan and affirm that the procedure is not solely for cosmetic purposes.
In addition to the LMN, individuals must retain detailed, itemized receipts for the microneedling services. These receipts should clearly show the date of service, the procedure performed, and the cost incurred. Maintaining meticulous records, including the LMN and all receipts, is important for tax purposes and in the event of an IRS audit, as these documents prove the distribution was for a qualified medical expense.
Submitting Your HSA Claim
Once all necessary documentation, including the Letter of Medical Necessity and itemized receipts, has been gathered, you can proceed with submitting your HSA claim. Most HSA administrators offer convenient methods for claim submission, often through an online portal or via mail. When submitting, indicate the amount of reimbursement requested and how you wish to receive the funds, such as direct deposit or a check.
It is important to keep copies of all submitted documentation for your personal records. The IRS recommends retaining records of all distributions for as long as your tax return is open to audit, typically three years, or as long as your HSA account remains open, whichever period is longer. While some HSA providers may not require immediate submission of supporting documents, maintaining these records is the individual’s responsibility to validate the qualified nature of the expense if requested by the IRS.