The Complete Merchant's Guide to FSA/HSA Eligibility

Turn confusing IRS rules into a competitive advantage for your Shopify store.

Most Shopify merchants selling health or wellness products don't realize just how much of their catalog could be eligible for FSA/HSA spending. And even when they do, the eligibility rules are confusing, fragmented, and not designed for e-commerce.

Between IRS §213(d) tax code, SIGIS databases, and IIAS filters, merchants are left guessing. Worse, this creates uncertainty for shoppers — who won't add to cart if they don't know whether their FSA/HSA will work.

That's where Burst changes the game.

Why Eligibility Feels So Hard

Traditionally, merchants had to navigate:

• SIGIS (Special Interest Group for IIAS Standards): SKU-level database built for big-box retailers like CVS/Walmart. Most Shopify brands aren't in it.

• IIAS (Inventory Information Approval System): A point-of-sale filtering system for in-store purchases. Not designed for online DTC flows.

• IRS §213(d): The actual rulebook of what counts as a medical expense. Dense, technical, and not mapped to Shopify SKUs.

Result: For DTC merchants, mapping products to SIGIS or running IIAS checks is nearly impossible — and doesn't actually solve the shopper experience problem.

SIGIS/IIAS vs. Burst Eligibility: Side-by-Side

Takeaway: SIGIS/IIAS was designed for pharmacies in the 1990s. Burst was designed for Shopify brands in 2025.

How Burst Simplifies Eligibility

Burst's eligibility engine cuts through the complexity:

• No SIGIS mapping, no IIAS codes, no SKU headaches

• Products are automatically categorized into three buckets:

  • ✅ Clearly eligible

  • 📄 LMN required (Letter of Medical Necessity)

  • ❌ Not eligible

• Updates happen automatically as IRS guidance evolves

👉 Merchants don't need to know the buckets themselves. Burst's Shopify app tags every product for you.

Pro tip: Want to check a product's eligibility bucket yourself? Just prepend its product URL with: getburst.com/[product-url]

Example:
getburst.com/yourstore.com/products/sunscreen-spf30

Why Shopper Education Matters

Even with perfect eligibility categorization, shoppers won't buy what they don't understand.

Your job as a merchant isn't to make them tax experts — it's to make them confident.

Best Practices for Shopper Education

1. Add clear badges

• ✅ “FSA/HSA Eligible” for clearly eligible products

• 📄 “FSA/HSA Eligible with LMN” for LMN-required SKUs

• ❌ Skip badges for ineligible products (avoid confusion)

2. Create dedicated collections

• Example: “Shop with Your FSA/HSA” or “Pre-Tax Savings Collection”

• Group all clearly eligible + LMN products in one place

3. Update product descriptions

• “This product qualifies for FSA/HSA reimbursement.”

• “This product is eligible with a Letter of Medical Necessity (automated by Burst).”

4. Build a quick FAQ section

• How do I use my FSA/HSA here?

• Do I need a doctor's note?

• How long does reimbursement take?

Why This Matters for Conversion

• Clarity builds trust → Shoppers add more to cart

• Badges reduce confusion → Lower cart abandonment

• Collections drive discovery → Higher AOV as shoppers browse more SKUs

• Education reduces CX tickets → Fewer “Is this covered?” questions for your team

Common Merchant Mistakes

• Not labeling products at all → Leaves shoppers guessing, kills conversions

• Over-promising eligibility → Leads to denied claims and frustration

• Avoiding LMN-required products → Misses high-margin revenue opportunities

How Burst Handles It End-to-End

With Burst:

• Products are automatically tagged in Shopify (✅, 📄, ❌)

• Badges and collections update dynamically

• Shoppers are guided post-purchase with eligibility + reimbursement instructions

• LMNs are generated automatically (<24 hrs) for products that need them

👉 Want to skip the SIGIS/IIAS mess and make eligibility automatic? See how Burst works for brands.

Next Steps

1. Install Burst's Shopify app

2. Let Burst auto-tag your catalog into the 3 buckets

3. Add badges + build an eligibility collection

4. Use Burst's post-purchase flows to educate shoppers automatically

The Bottom Line: FSA/HSA eligibility doesn't need to be a SIGIS/IIAS nightmare. With Burst, it's automated, transparent, and conversion-driving.

References

[1] IRS Publication 502, “Medical and Dental Expenses.”
[2] Burst. “Boost sales with friction-free FSA/HSA checkout.” getburst.com