Half Way House: FSA Eligibility

The cost of a half way house necessary for treatment of an addiction or other medical treatment may be eligible with a Letter of Medical Necessity (LMN) with a flexible spending account (FSA), health savings account (HSA) or a health reimbursement arrangement (HRA). Half way house reimbursement is not eligible with a limited care flexible spending account (LCFSA) or a dependent care flexible spending account (DCFSA).

What is a half way house?

A half way house, also known as a sober living house, are transitional living facilities that are designed to provide a safe, welcoming environment for individuals who are overcoming addictions to drugs, alcohol and other substances. Individuals who enter a half way house come to these facilities for a variety of reasons, be it as a result of a recent court order, transitioning from a treatment center, prison or living homeless who need assistance in beginning the recovery process. In most cases, half way houses will require residents to pass drug screening tests or breathalyzers to ensure that they are committed to their recovery and not a risk of compromising other residents' recoveries.

Half way houses are typically run by counselors who have professional substance abuse training, or individuals who have overcome their respective addictions or were once halfway house residents themselves. The facilities usually house both men and women, and they are located nearby to Alcoholics Anonymous or Narcotics Anonymous meetings to ensure that half way house residents can gain access to hands-on treatment while living in a communal setting of individuals who are working toward similar goals.

How do I obtain a Letter of Medical Necessity for a half way house?

Half way houses usually charge monthly rent payments for its residents, and while residency is sometimes contingent on court orders and other regulations, individuals who wish to cover the expense for him/herself, spouse or qualifying dependents must obtain a Letter of Medical Necessity (LMN) from a physician for reimbursement through an FSA, HSA or HRA.

If a doctor recommends a half way house as a necessary treatment for a drug/alcohol addiction, a Letter of Medical Necessity (LMN) must be obtained for reimbursement through an FSA, HSA or HRA. This letter must outline how an account holder's needs for help, related to their medical condition, necessitates a half way house residency and how the half way house will be used to alleviate the issue. If the treatment plan exceeds the current plan year, another LMN will have to be provided to the benefits administrator to cover the duration of the treatment.

Eligibility Table

Flexible Spending Account (FSA) Limited Care FSA Dependent Care FSA Health Savings Account (HSA) Health Reimbursement Account (HRA)

Eligible

Eligible with Rx

Eligible with LMN

Not Eligible

 


AZ-PROD-WEB01 11/22/2017 3:25:05 AM