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When is a Letter of Medical Necessity (LMN) Is Required?
A Letter of Medical Necessity is required whenever the expense is not automatically considered medical under IRS §213(d) and needs documentation to prove it’s specifically for treatment of a diagnosed medical condition — rather than lifestyle, cosmetic, or general health.
Why Retailers Label Items as “FSA/HSA Eligible”
When you see products labeled as “FSA/HSA eligible” at Amazon, CVS, Walgreens, or other retailers, it’s easy to assume they’ll be automatically reimbursed through your account. In reality, the IRS maintains a broad list of eligible expenses under Section 213(d), but some of those items are only reimbursable if they treat a diagnosed medical condition. That’s where a Letter of Medical Necessity (LMN) from your provider comes in.
Retailers use the broad label for simplicity and marketing. If they listed items as “eligible with LMN,” it could confuse or discourage shoppers. To keep checkout simple, retailers rely on systems like IIAS, which automatically flag eligible products by their SKU codes. This means your FSA or HSA card may approve the purchase — even though your plan administrator could later require an LMN before reimbursing you.
Take Invisalign, for example. It’s often marked as “HSA/FSA eligible,” but the IRS only allows reimbursement if prescribed to correct a dental condition, not for cosmetic purposes. Ultimately, retailers market broadly, while administrators enforce compliance. The key takeaway: just because an item is labeled eligible doesn’t mean it’s automatically approved. Always check if an LMN is required before submitting your claim.
