Lawmakers ask IRS to expand health savings accounts to include nutritional supplements

By Danielle Masterson contact

- Last updated on GMT

© Getty Images / Lecic
© Getty Images / Lecic

Related tags: Fda, Npa, DHSEA, Crn, Dietary supplement, publication 502

The bipartisan effort is picking up steam as more senators join the cost-reducing effort.

As prescription medications and other healthcare costs soar, more Americans are looking to alternatives to and seeking ways to promote health rather than treat ailments.

The Council for Responsible Nutrition Consumer Survey on Dietary Supplements recently revealed the highest overall dietary supplement usage to date. Underscoring the vital role supplementation plays in the lives of most Americans, the survey found that 77% of Americans report they consume dietary supplements. Despite the health benefits, most people pay out-of-pocket. 

Congressman Buddy Carter (R-GA) and other lawmakers recently asked Internal Revenue Services (IRS) Commissioner Charles P. Rettig to allow selected categories of nutritional supplements to be considered “medical expenses” under Health Savings Accounts (HSAs), Flexible Spending Accounts (FSAs) and Health Reimbursement Arrangements (HRAs).

Additional members of Congress who signed the letter include: Rep. Glenn Grothman, (R-WI), Rep. Barry Loudermilk (R-GA), Rep. Brian Mast (R-FL), Rep. Bill Posey (R-FL), Rep. Adrian Smith (R-NE), Rep. Christopher Smith (R-NJ) and Rep Mark Walker (R-NC). 

A defining moment 

The senators said allowing nutritional and dietary supplements to be considered “medical expenses” would promote consumer choice, better health and modernize Publication 502, the document which defines medical and dental expenses consumers pay for.

The IRS hasn’t changed the definition of “medical care” since 1954. The senators cite the Nutrition Labeling and Education Act as well as DSHEA as a means of updating the definition of “medical care” to include dietary supplements. 

“I applaud the recent action by forward-thinking lawmakers in Congress to ask the Internal Revenue Service to allow science-based nutritional supplements with FDA-approved structure function claims to be considered in the medical expenses category and be allowed for purchase using HSA, FSA, and HRA funds,”​ Dan Grubler,  Ph.D. founder and CEO of Health Unveiled, told NutraIngredients-USA. 

“Giving people more ways to save money in their preventative health care costs is a commonsense solution that can reduce costs for patients and taxpayers,”​ said Daniel Fabricant, Ph.D., president and CEO of National Products Association (NPA). “Too much of our focus in this country is on disease treatment rather than prevention. This simple change in our regulations promotes the proactive, preventive approach that we need to support if we wish to improve Americans’​ health and healthcare costs.”

Moving beyond a Letter of Medical Necessity

The letter states, “You can include in medical expenses the cost of nutritional supplements, vitamins, herbal supplements, ‘natural medicines,’ etc., provided that such products are labeled with a health claim authorized by the Food and Drug Administration, bear statements describing how they are intended to affect the structure or function of the human body, or bear statements characterizing the mechanism by which the product acts to maintain such structure or function."

The selected categories include nutritional and dietary supplements that carry health claims or structure/function claims. Examples include “calcium builds strong bones,” “antioxidants maintain cell integrity,” “adequate calcium and vitamin D as part of a healthful diet, along with physical activity, may reduce the risk of osteoporosis in later life,” and more.

Currently, nutritional supplements are only be eligible for reimbursement with a FSA, HSA, and HRA with a Letter of Medical Necessity from a doctor. Certain vitamins, such as glucosamine, chondroitin and prenatal vitamins are eligible for FSA, HSA and HRA reimbursement with no restrictions.

A list of all deductible medical expenses and any updates on Publication 502 can be found here​. 

More voices join the bipartisan choir 

Following the senators’ November 12th letter​, several more senators joined the call to action. On November 19th, senators Tim Scott (R-SC), Kyrsten Sinema (D-AZ), along with Mike Braun (R-IN), Rand Paul (R-KY), John Boozman (R-AR) and Senator Mike Lee (R-UT) also requested ​the IRS expand HSAs to include dietary supplements. 

“We are blessed to live in a nation where we have enough of what we need, but we need to empower folks to be able to make the best choices as it relates to their wellbeing and that of their families,”​ said Senator Scott. “I applaud my colleagues for joining me in taking action to enable Americans to make proactive choices that will improve their overall health and expand their access to more nutritious options in the future.”

Gubler, a natural products chemist, told NutraIngredients-USA, “Cutting-edge scientific advancements in recent years have confirmed that natural molecules from plants have the ability to support everyday human health and wellness.

If we are going to fight back against the health plagues sweeping the earth—many of which are self-inflicted due to poor lifestyle factors—it is imperative that people are allowed to use every science-based method, without penalty, in preventing, supporting, and treating human health"

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