The bill, which would extend coverage for dietary supplements starting in 2027, also applies to Health Reimbursement Arrangements (HRAs) and Archer Medical Savings Accounts (MSAs), subject to annual limits.
“Nutritional supplements are a crucial form of preventative care, keeping people healthier in the long run and, ultimately, driving down healthcare costs,” said Sen. Cramer. “But right now, the rules don’t fully reflect this reality. By modernizing how health savings accounts and flexible spending accounts can be used, this bill gives families more freedom, more choice, and more ability to invest in their own wellbeing.”
The Dietary Supplements Access Act would amend the Internal Revenue Code to designate over-the-counter dietary supplements as qualified medical expenses. Under the proposal, individuals could use up to $250 annually from their health accounts for supplements, while joint filers could use up to $500 per year.
“Dietary supplements are an important part of many Utahns’ health and wellness routines and are key to making America healthy again,” Sen. Curtis added. “By expanding access to supplements through HSAs and FSAs, our legislation empowers individuals to take greater ownership of their health while helping reduce long-term healthcare costs.”
A “companion measure” was also introduced in the House by Representatives Darin LaHood (R-IL-16), Brendan Boyle (D-PA-2), Claudia Tenney (R-NY-24) and Josh Gottheimer (D-NJ-5).
Dietary supplements and HSAs/FSAs
Almost 40 million Americans have nearly $147 billion in tax preferred HSAs, while 37 million Americans have FSAs through their employment. The IRS dictates how HSA/FSA dollars can be spent and that only purchases that are made to specifically prevent or treat a medical condition are eligible. Several products do not need a doctor’s approval to be purchased with these dollars, such as sunscreens, band aids and contact solutions. A revision to Publication 502 in 2000 excluded dietary supplements unless prescribed by a physician.
Allowing consumers to use their HSAs, FSAs and HRAs to purchase dietary supplements has long been a key objective for the dietary supplement trade associations, with the National Products Association (NPA) and the Council for Responsible Nutrition (CRN) carrying that message to lawmakers during visits to lawmakers on Capitol Hill in recent years.
Members of Congress have introduced bills that would achieve this goal, with the bipartisan Dietary Supplements Access Act being introduced in the House in July 2023 (H.R. 4794, introduced by Rep. Darin LaHood (IL-16), et al.), followed by a similar bill in the Senate in October 2023 (S. 3172, introduced by Sen. Kevin Cramer (R-ND)). Neither bill has advanced to become law.
Last year, dietary supplement trade associations wrote letters to the commissioner of the IRS to request changes to the tax code to permit the purchase of dietary supplements using HSAs and FSAs.
Industry supports ‘commonsense legislation’
The new bill is supported by dietary supplement trade associations, including NPA, CRN and the Consumer Health Products Association (CHPA).
Steve Mister, president & CEO of CRN, said that allowing Americans to use their own healthcare dollars for dietary supplements is a commonsense reform that aligns with today’s healthcare priorities.
“This legislation helps empower consumers to make health investments using the same tax-advantaged tools already available for many other wellness and medical expenses,” he said.
“At a time when more science is supporting the use of dietary supplements to maintain health and wellness, expanding HSA and FSA eligibility to include supplements is smart healthcare policy,” stated Scott Melville, CHPA president and CEO. “Giving consumers the ability to use their own pre-tax dollars to purchase supplements makes healthcare more affordable and accessible and empowers Americans to take a more proactive approach to their health and wellness. This legislation builds on bipartisan efforts to expand access to trusted self-care products, and CHPA applauds Senator Cramer for championing greater flexibility and affordability for consumers.”
Daniel Fabricant, PhD, president and CEO of NPA, called the act a “commonsense, pro-consumer bill that empowers Americans to take charge of their own health and wellness.”
“Millions of Americans use dietary supplements as part of their daily health routine, yet current tax law treats these products as a luxury rather than the legitimate health tool they are,” he added. “NPA commends the bipartisan, bicameral leadership of Senators Cramer and Curtis and Representatives LaHood, Tenney, Gottheimer and Boyle for championing this issue, and we urge Congress to move swiftly on this important legislation.”
The text for the bill can be read HERE.
