Is ChapStick or Lip Balm FSA or HSA Eligible?

Short answer

SPF 15+ broad-spectrum lip balm and medicated cold-sore treatments (with a Drug Facts label) are reimbursable outright from FSA, HSA and HRA accounts. Plain lip balm with no SPF and no drug information label is not reimbursable because it's a personal care item under IRS rules.

The difference is the purpose. Sunscreen with SPF 15 or higher counts as a medical expense under a long-standing IRS position, and any OTC medicine such as a cold-sore treatment counts since the CARES Act of 2020. But a lip balm you use for moisture or flavor has no medical purpose and isn't eligible.

Which lip balms are reimbursable

Lip balm eligibility depends on what the product is designed to do. Broad-spectrum sunscreen with SPF 15 or higher qualifies as a medical expense. Any medicated lip balm with a Drug Facts label, such as docosanol (a cold-sore treatment), is an OTC medicine and is reimbursable outright. Plain lip balm, flavored balm, or tinted balm with no SPF and no drug information label is a personal care item and is not reimbursable.

The test behind the table is Publication 502's definition: medical expenses are "the costs of diagnosis, cure, mitigation, treatment, or prevention of disease". Sun protection and a cold-sore medicine meet it. Moisture and flavor don't.

How to buy SPF or medicated lip balm

You can buy SPF 15+ lip balm or a medicated cold-sore treatment with any card at any store or online. No letter is needed. Just look at the label to make sure it says SPF 15 or higher (and broad spectrum) or check the Drug Facts label for the active ingredient. Burst files the reimbursement claim with your FSA, HSA or HRA administrator, and the administrator pays you out of your account by deposit or check.

Why plain lip balm is not reimbursable

The IRS excludes items used for personal purposes from medical expenses. According to Publication 502, "you can't include in medical expenses the cost of an item ordinarily used for personal, living, or family purposes" unless it treats a diagnosed medical condition. Plain lip balm falls into the personal-use category.

It's treated the same way as toothpaste or deodorant. A lip balm bought for moisturizing or flavor has no medical purpose and cannot be reimbursed.

Publication 502 gives the everyday example: "the cost of a toothbrush and toothpaste is a nondeductible personal expense". Plain lip balm sits in the same drawer.

Related items in the same family

The same rule applies to all sunscreen. Any broad-spectrum SPF 15 or higher sunscreen is reimbursable outright, whether it's a lotion, spray, stick or balm. Medicated treatments for skin conditions like cold sores, acne or eczema with a Drug Facts label are OTC medicines and are reimbursable. But regular moisturizers, lip glosses, and beauty lip products with no SPF and no drug label are personal care items and are not reimbursable.

Getting SPF lip balm reimbursed with Burst

Here's the practical route. Request a letter of medical necessity from Burst ($35 once, about two minutes). A licensed clinician reviews it and it's typically in your inbox within 24 hours. Burst files the reimbursement claim with your FSA, HSA or HRA administrator, who pays you out of your account by deposit or check. If there's no letter there's no charge, and a denied claim means your money back. The letter has to be dated on or before the purchase it covers, so do this step first.

Get reimbursed for my lip balm

Frequently asked questions

Is ChapStick FSA or HSA eligible?

Only certain ChapStick products are eligible. ChapStick with SPF 15 or higher is reimbursable outright. ChapStick cold-sore treatment with a Drug Facts label is reimbursable. Plain ChapStick is a personal care item and is not eligible.

What SPF level does my lip balm need?

SPF 15 or higher, and it must be broad spectrum. That's the threshold for any sunscreen to be a qualified medical expense. Check the label to confirm the SPF is 15 or higher.

Is medicated cold-sore treatment FSA or HSA eligible?

Yes. Any medicated cold-sore treatment with a Drug Facts label is an OTC medicine and is reimbursable outright from an FSA, HSA or HRA. Docosanol is the most common active ingredient.

Can I get a letter for plain lip balm?

No. Plain lip balm is a personal care item and cannot be reimbursed. The IRS rule is clear: a personal care item must be used primarily to prevent or alleviate a physical or mental disability. Plain lip balm has no medical purpose. If you need medicated treatment for a lip condition, choose a product with a Drug Facts label.

Is lip balm from my regular pharmacy FSA eligible?

It depends on the product type. SPF 15+ lip balm and medicated treatments with Drug Facts labels from any pharmacy are eligible. Plain moisturizing lip balm from any pharmacy is not eligible, regardless of where you buy it.

Do I need to buy a specific brand?

No. Any brand of SPF 15+ lip balm or medicated cold-sore treatment works. Burst doesn't have a preferred brand. Just check the label for SPF 15+ (broad spectrum) or a Drug Facts label to confirm eligibility.

Keep reading: Complete guide to FSA and HSA eligible items, What Can I Use My FSA Funds On?, What Can I Use My HSA Funds On?, and all guides on this topic.

Sources

• IRS Publication 502 - Medical and Dental Expenses (SPF sunscreen as a qualified medical expense, personal use items rule, medicated treatments and OTC medicines (CARES Act 2020))

• IRS Publication 969 - Health Savings Accounts and Other Tax-Favored Health Plans (FSA, HSA and HRA accounts cover the same qualified medical expenses)

• Healthcare.gov Glossary - FSA, HSA and HRA Information (Account types and qualified medical expense definitions)