Washington, D.C.—How are flexible spending accounts (FSAs) and health savings accounts (HSAs) used, and how they should work in regard to purchasing dietary supplements? The Council for Responsible Nutrition (CRN) and the Consumer Healthcare Products Association (CHPA) set out to explore people's understanding of HSAs and FSAs through a jointly commissioned Ipsos survey.

CRN explained that, under current law, FSAs and HSAs allow employees to put aside money before it has been taxed to pay for certain healthcare costs related to medical care, prescription drugs, dental and vision care, over-the-counter medications, menstrual products, and other health-related items. The law does not routinely allow dietary supplements to be recognized as “qualified medical expenses.” The majority of consumers want to see that change, according to the survey.

78% of respondents who have an FSA or HSA want their accounts to include supplements as allowable reimbursements. 

“Although 75% of Americans use some type of dietary supplement, tens of millions of these same people, who invest into FSAs and HSAs, can’t then use that money to purchase, for example, children’s vitamins for their kids,” said Steve Mister, President & CEO of CRN, in a press release. “Our interpretation of this survey tells us people don’t want to be penalized any longer for being proactive about their health by purchasing products that will help to keep their families healthy.”

Scott Melville, President & CEO of CHPA, added, “Consumers deserve and want the ability to choose how to best use their money to stay healthy and practice self-care. With more Americans incorporating dietary supplements into their overall self-care plans, we must recognize the ever-increasing role they play in helping people improve their health and wellness. Today’s proactive consumers want flexibility to make pre-tax purchases of a range of health products, from OTC medicines and devices to dietary supplements, and these accounts should be a resource that encourages people to take charge of their health.”

Fast facts about FSAs and HSAs

• It is estimated that, in 2020, Americans put more than$30 billion into FSA accounts.
• At the beginning of 2022, Americans had approximately $100 Billion invested in HSAs^..
• 33% of FSA/HSA account owners mistakenly believe they can already use their pre-tax account savings to purchase vitamins and other dietary supplements for general health, according to the survey.
• Another 29% of FSA/HSA account owners in the survey said they “don’t know” whether these products are covered or not.  

CRN said expanding access to supplements continues to be a priority for both CRN and CHPA in 2023, with the anticipated introduction of new legislation in Congress. CRN reported: "While critics of previously introduced bills worried 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 survey actually revealed that 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 make them open an account and contribute to it."

Research also suggests there is a longer-term benefit of making it easier for consumers to get their supplements. As WholeFoods Magazine has reported, a 2022 CRN study revealed that the potential savings to the U.S. healthcare system from the use of specific dietary supplements by certain populations could reduce the direct and indirect medical costs associated with several common conditions by tens of billions of dollars annually.

“Americans are using dietary supplements and saving the country billions in healthcare costs,” said Mister. “Any tax-revenue hit the federal government would experience would be offset by the overall savings to the healthcare system. It makes sense for consumers—and the country.”