Scar Treatment: FSA Eligibility

Scar Treatment: requires a Letter of Medical Necessity (LMN) to be eligible with a Flexible Savings Account (FSA)
Scar treatment is eligible with a Letter of Medical Necessity (LMN) with a flexible spending account (FSA), health savings account (HSA) and a health reimbursement arrangement (HRA). Scar treatment reimbursement is not eligible with a limited-purpose flexible spending account (LPFSA) or a dependent care flexible spending account (DCFSA).

What is scar treatment?

Scar treatment is a method of removing scar tissue for cosmetic purposes. There are various methods of performing scar treatments, such as cryotherapy, surgery, and keloid prevention via gel pads or pressure treatment (WebMD).

Scar treatment is generally not considered eligible for reimbursement with a consumer-directed healthcare account because of its association with cosmetic procedures. If a medical professional deems a scar treatment procedure medically necessary, and provides a Letter of Medical Necessity (LMN), then the expense of scar treatment is eligible for reimbursement with a consumer-directed healthcare account.

Scar treatments that may be considered medically necessary vary by scar. The most common example is a contracture scar, which usually occur after a burn injury. Contracture scars contract the skin and impair movement. A major burn and its subsequent scarring may be debilitating and require scar treatment in order for the individual to return to a normal lifestyle. In such a case, a medical professional can be consulted to obtain an LMN for scar treatment.

Keloid scars extend beyond the original site of the injury and are the result of an overly aggressive healing process. They may impair movement similarly to contracture scars. Hypertrophic and acne scars are less likely to produce any debilitating effects, and scar treatments to remove them are more likely to be considered cosmetic in nature, and therefore ineligible for reimbursement with any consumer-directed healthcare accounts.