The IRS issued two information letters to assist participants and plan sponsors in determining whether herbs for treating a medical condition and service animals for individuals with mental health disabilities may be reimbursed from a health FSA as a medical expense. The letter provides the following:  

  • An herb may qualify as a medical care expense if the individual can substantiate that he or she has a medical condition, purchased the herb to treat or alleviate the medical condition, and would not have purchased the herb but for the medical condition.  
  • Expenses related to buying, training, and maintaining a service animal to assist individuals with mental health disabilities may qualify as medical care expenses if the individual shows that he or she is using the service animal primarily for medical care to alleviate a mental defect or illness and would not have paid the expenses but for that defect or illness.