Bipartisan bill would empower consumers to use Flexible Spending Accounts and Health Savings Accounts to purchase dietary supplements

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A newly proposed congressional bill aims to allow consumers to use Flexible Spending Accounts (FSAs) and Health Savings Accounts (HSAs) to purchase dietary supplements using pre-tax dollars, making supplement purchasing more economical. The bipartisan Dietary Supplements Access Act was introduced on July 20, 2023, by U.S. Representatives Darin LaHood (R–IL), Brendan Boyle (D–PA), John Curtis (R–UT), and Josh Gottheimer (D–NJ).

Currently, most dietary supplements are not eligible purchases under FSA and HSA plans. These plans generally only cover supplements that are prescribed by physicians for specific medical purposes, such as for prenatal care.

According to a 2023 HSA & FSA Reimbursement Study, a survey on U.S. consumer opinions on HSA and FSA accounts, up to 78% of Americans who currently have an FSA or HSA account said they would like the option of using these accounts to purchase dietary supplements. This survey was sponsored by industry associations the Council for Responsible Nutrition (CRN; Washington, DC) and the Consumer Healthcare Products Association (CHPA; Washington, DC) and was conducted by Ipsos in March 2023 on 1892 U.S. adults.

Allowing FSAs and HSAs to include general dietary supplement purchases would make supplements more affordable for more Americans. As such, the new bill has received support from major supplement industry associations, including CHPA, CRN, the American Herbal Products Association (AHPA; Silver Spring MD), the Natural Products Association (NPA; Washington, DC), and the United Natural Products Alliance (UNPA; Salt Lake City, UT). The groups' joint statement notes that the new legislation would give “millions of Americans increased health and wellness options for better self-care.”

Previous bills have been introduced also with the aim of making supplements eligible medical expenses under FSAs and HSAs.

In the joint association statement, Scott Melville, president and CEO of CHPA, said, “By allowing dietary supplements to be added to the list of qualified medical expenses, this bill builds on previous legislative efforts, including a bipartisan victory in 2020 that expanded FSA and HSA eligibility to include over-the-counter medicines and feminine hygiene products.”

Rep. Boyle noted in his statement that “Since HSAs, FSAs, and HRAs require a prescription for the reimbursement of vitamins, it makes sense to remove barriers to supplementing nutrient-deficient diets. This legislation will serve to remove many impediments to self-care with the goal of creating a sensible path toward better health for all.” He added that more than 22 million Americans have currently chosen to enroll in HSAs, indicating “substantial demand.”

As for critics of such proposals who are concerned about any loss in incoming federal tax dollars, the associations stated: “HSA plans are used by Americans from every income level, with the average HSA contribution being 2% of household income, according to findings from the Employee Benefit Research Institute (EBRI). While critics of similar legislation previously introduced in Congress expressed concern that expanding the allowable medical expenses to include dietary supplements would mean less overall tax revenue for the federal government due to more money flowing to these tax-free accounts, the Reimbursement Study revealed only 34% of FSA/HSA holders said they are likely to increase their current investment levels, and only 25% of non-account holders said the change would prompt them to open an account and contribute to it. Furthermore, findings from a 2022 VISA FSA Survey show that, over the past decade, FSA/HSA contribution amounts have remained static regardless of policy changes such as expanded eligibility for over-the-counter (OTC) consumer products.”

Other industry association leaders issued supportive statements. AHPA President Michael McGuffin said, “Putting consumers in charge of their health choices and allowing them to make informed decisions about their healthcare—as this legislation would do—makes good policy sense.”

UNPA President Loren Israelsen stated, “Taxpayers deserve the choice to control their own spending, and this long-overdue bill will provide greater incentives for adopting and maintaining healthy lifestyles.”

CRN President and CEO Steve Mister stated, “Dietary supplements play critical roles to fill nutrient gaps and promote overall health and wellness. They not only can reduce risks associated with chronic conditions but can also lead to billions in savings for America’s healthcare system, as evidenced by the CRN Foundation’s recent healthcare cost-savings study ‘Supplements to Savings.’”

NPA President and CEO Daniel Fabricant, PhD, stated, “Expanding access to nutritional supplements is an innovative solution that will keep more Americans healthy, which is the most cost-effective public health policy of all. With industry champions like Reps. LaHood, Boyle, Curtis, and Gottheimer sponsoring this legislation, we have a good foundation for advancing this bill through Congress.”