HRA-Eligible Medical Expenses

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1 HRA-Eligible Medical Expenses Before submitting a claim for HRA reimbursement of medical expenses, it is important to determine what is reimbursable and what is not reimbursable under your HRA plan. To be reimbursed by an employer, medical expenses must meet two criteria: 1. They must be allowed by the IRS. 2. They must be allowed by the company s plan document. This document will help you determine whether which medical expenses are allowed by the IRS. Please keep in mind that simply because medical services or over-the-counter (OTC) drugs are eligible for reimbursement under IRS guidelines, they are not necessarily approved for reimbursement under a company s HRA plan. The company may restrict which medical expenses it will reimburse. Generally, the company will specify which IRS-approved medical expenses are excluded from the plan. Employees should carefully review their HRA plan documents to determine which medical expenses will not be reimbursed. IRS-Guidelines Employees should carefully review their HRA plan documents to determine which medical expenses will not be reimbursed. Internal Revenue Service (IRS) Code Section 213(d) and IRS Publication 502 provide the guidelines for reimbursable and non-reimbursable medical expenses; however, some cases may not be completely clear-cut. IRS Publication 502 defines medical care for the purposes of deducting or reimbursing these expenses. The definition is as follows: (1) The term medical care means amounts paid A. For the diagnosis, cure, mitigation, treatment, or prevention of disease, or for the purpose of affecting any structure or function of the body, B. For transportation primarily for and essential to medical care referred to sub-paragraph (A), C. For qualified long-term care services (as defined in section 7702B (c)), or D. For insurance (including amounts paid as premiums under part B of title XVIII of the Social Security Act, relating to supplementary medical insurance for the aged) covering medical care referred to in sub-paragraphs (A) and (B) or for any qualified long-term care insurance contract (as defined in section 7702B (b)). The following lists of reimbursable and non-reimbursable medical expenses and OTC drugs were compiled by the Connecticut Business & Industry Association and are based upon IRS Code Section 213(d) and IRS Publication 502.

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4 Eligible Medical Expenses and OTC Drugs* Medical Expenses: Abdominal supports Abortion Acupuncture Air conditioner (when necessary for relief from breathing difficulty) Alcoholism treatment Ambulance Anesthetist Arch supports Artificial limbs Autoette (when used for sickness/disability relief) Birth control pills (by prescription) Blood tests Blood transfusions Braces Cardiographs Chiropractor Christian Science practitioner Contact lenses Contraceptive devices (by prescription) Convalescent home (for medical treatment only) Crutches Dental treatment Dental x-rays Dentures Dermatologist Diagnostic fees Diathermy Drug addiction therapy Drugs (prescription) Elastic hosiery (prescription) Eyeglasses Fees paid to health institute prescribed by a doctor FICA and FUTA tax paid for medical care service Fluoridation unit Guide dog Gum treatment Gynecologist Healing services Hearing aids and batteries Hospital bills Hydrotherapy Insulin treatment Lab tests Lead paint removal Legal fees Lodging (away from home for outpatient care) Metabolism tests Neurologist Nursing (including board and meals) Obstetrician Operating room costs Ophthalmologist Optician Optometrist Oral surgery Organ transplant (including donor s expenses) Orthopedic shoes Orthopedist Osteopath Oxygen and oxygen equipment Pediatrician Physician Physiotherapist Podiatrist Postnatal treatments Practical nurse for medical services Prenatal care Prescription medicines Psychiatrist Psychoanalyst Psychologist Psychotherapy Radium therapy Registered nurse Special school costs for the handicapped Spinal fluid test Splints Sterilization Surgeon Telephone or TV equipment to assist the hard-of-hearing Therapy equipment Transportation expenses (relative to health care) Ultra-violet ray treatment Vaccines Vasectomy Vitamins (if prescribed) Wheelchair X-rays

5 Over-the-Counter Drugs: Antacids Allergy medications Pain relievers Cold medicine Anti-diarrhea medicine Cough drops and throat lozenges Sinus medications and nasal sprays Nicotine medications and nasal sprays Pedialyte First aid creams Calamine lotion Wart removal medication Antibiotic ointments Suppositories and creams for hemorrhoids Sleep aids Motion sickness pills Ineligible Medical Expenses and OTC Drugs* Medical Expenses: Advancement payment for services to be rendered next year Athletic club membership Automobile insurance premium allocable to medical coverage Boarding school fees Bottled water Commuting expenses of a disabled person Cosmetic surgery and procedures Cosmetics, hygiene products and similar items Funeral, cremation, or burial expenses Health programs offered by resort hotels, health clubs, and gyms Illegal operations and treatments Illegally procured drugs Maternity clothes Non-prescription medication Premiums for life insurance, income protection, disability, loss of limbs, sight or similar benefits Scientology counseling Social activities Special foods and beverages Specially designed car for the handicapped other than an autoette or special equipment Stop-smoking programs Swimming pool Travel for general health improvement Tuition and travel expenses a problem child to a particular school Weight loss programs Over-the-Counter Drugs: Toiletries (including toothpaste) Acne treatments Lip balm (including Chapstick or Carmex) Cosmetics (including face cream and moisturizer) Suntan lotion Medicated shampoos and soaps Vitamins (daily) Fiber supplements Dietary supplements Weight loss drugs for general well being Herbs

6 IRS Language on Eligible and Ineligible Medical Expenses For further clarification, you may visit the websites provided below. Remember that all medical expenses incurred by employees with an HRA must comply with IRS Code Section 213(d) and IRS Publication 502. IRS Code Section 213(d): IRS Publication 502: Contact Us To learn more about our Employer Solutions and Affiliate Programs, call , us at or visit us online at

2017 FLEXIBLE SPENDING PLAN ELECTION EMPLOYER NAME: PEOPLE LEASE PLAN YEAR: JANUARY 1, 2017 THROUGH DECEMBER 31, 2017

2017 FLEXIBLE SPENDING PLAN ELECTION EMPLOYER NAME: PEOPLE LEASE PLAN YEAR: JANUARY 1, 2017 THROUGH DECEMBER 31, 2017 Employee Name: Date of Birth: Address: Marital Status: Sex: I decline to participate