Your Complete Guide to Using FSA Funds for Medical Supplies in 2025
If you have a Flexible Spending Account (FSA) through your employer, you're sitting on tax-free dollars that can cover hundreds of essential medical supplies-yet many people with FSAs never realize the full scope of what they can purchase. The reality? Most ostomy supplies, diabetic products, catheterization equipment, and incontinence items qualify for FSA reimbursement, potentially saving you 25-35% compared to paying out-of-pocket.
This guide breaks down exactly which medical supplies are FSA-eligible, how to maximize your account benefits, and what documentation you need to get reimbursed without hassle.
Understanding FSA Basics: How Flexible Spending Accounts Work
Before diving into eligible products, let's clarify FSA fundamentals for anyone new to these accounts or refreshing their understanding.
What Is an FSA?
A Flexible Spending Account is an employer-sponsored benefit allowing you to set aside pre-tax dollars from your paycheck to pay for qualifying medical expenses. Money goes into your FSA before federal, state, and Social Security taxes are calculated, reducing your taxable income.
The tax advantage is significant. If you're in the 25% federal tax bracket, every $1,000 in FSA contributions saves you approximately $300-350 in taxes (including state and Social Security taxes in most states).
Key FSA Rules to Remember
Annual contribution limits for 2025 are $3,200 per employee. If both spouses have FSA access through separate employers, each can contribute up to the maximum, potentially setting aside $6,400 tax-free annually for medical expenses. Use-it-or-lose-it rules require spending FSA funds within the plan year. However, many employers now offer one of two flexibility options: a $640 carryover to the next year, or a 2.5-month grace period into the following year. Check your plan documents to understand your specific rules. Run-out periods typically give you 30-90 days after the plan year ends to submit claims for expenses incurred during the previous year. This means you can buy supplies in December and have until March to submit receipts.The CARES Act Changes: More Products Now FSA-Eligible
The 2020 CARES Act expanded FSA eligibility significantly, removing the prescription requirement for many over-the-counter items. This change remains in effect for 2025 and made hundreds of medical supplies immediately FSA-eligible without needing a doctor's note.
Major categories affected:- Over-the-counter medications (pain relievers, cold medicine, allergy treatments)
- First aid supplies
- Feminine hygiene products (menstrual pads, tampons, cups)
- Adult incontinence products
- Diabetic supplies (test strips, lancets, monitors)
However, one critical requirement remains: medical necessity. FSA-eligible products must treat, diagnose, or prevent a specific medical condition. Products purchased purely for general wellness or convenience don't qualify.
Ostomy Supplies: What Your FSA Covers
If you live with a colostomy, ileostomy, or urostomy, virtually all supplies directly related to your ostomy care qualify for FSA reimbursement.
Pouching Systems and Barriers
One-piece and two-piece pouching systems are fully FSA-eligible, including both drainable and closed-end pouches. This covers your primary pouches regardless of manufacturer or specific features.
Skin barriers and wafers qualify whether you use flat, convex, pre-cut, or cut-to-fit options. Extended wear barriers, standard adhesive barriers, and specialty barriers for sensitive skin all fall under FSA coverage.
Barrier rings and seals used to protect peristomal skin and improve pouch seal are eligible. This includes moldable rings, convex inserts, and adhesive strips.
Ostomy Accessories That Qualify
Ostomy powders for managing peristomal skin irritation are FSA-eligible. These include stoma powders from all major manufacturers used to absorb moisture from damaged skin.
Barrier films and protective wipes that create a protective layer between skin and adhesives qualify for reimbursement. Both spray and wipe formats are covered.
Adhesive remover products designed for gentle pouch removal without skin trauma are eligible. Spray, wipe, and liquid formats all qualify.
Ostomy belts and support garments that help secure pouches and prevent leakage are covered as durable medical equipment.
Pouch deodorizers and irrigation supplies qualify when used for medical ostomy management rather than general hygiene purposes.
Ostomy scissors, measuring guides, and disposal bags count as eligible supplies when used specifically for ostomy care.
Explore FSA-eligible ostomy supplies including pouching systems, barriers, and accessories.
What Ostomy Items Don't Qualify
Clothing modifications like special undergarments without medical purpose, decorative pouch covers, or fashion accessories don't meet FSA requirements unless prescribed by a physician for specific medical necessity.
Fragrance or cosmetic products used around the stoma for aesthetic rather than medical reasons aren't eligible.
Diabetic Supplies: Comprehensive FSA Coverage
Diabetes management supplies represent one of the most commonly reimbursed FSA categories, with nearly all essential monitoring and treatment supplies qualifying.
Blood Glucose Monitoring Supplies
Glucose meters and monitors are FSA-eligible regardless of brand or features. This includes basic meters, smart meters with Bluetooth connectivity, and talking meters for visually impaired users.
Test strips for glucose monitoring qualify without limits. Whether you test twice daily or eight times daily, all strips purchased for medical monitoring are reimbursable.
Lancets and lancing devices used to obtain blood samples for testing are eligible. This covers single-use lancets, adjustable lancing devices, and alternate-site testing lancets.
Continuous glucose monitors (CGMs) and their supplies now qualify as FSA-eligible under updated IRS guidance. This includes sensors, transmitters, and receivers for CGM systems.
Insulin Delivery Supplies
Insulin syringes in all gauge sizes (28G-31G) and lengths are FSA-eligible. Whether you purchase individually packaged syringes or bulk boxes, all qualify for reimbursement.
Insulin pen needles for use with insulin pen devices are covered, including ultra-short needles (4mm) through longer options (8mm-12mm).
Insulin pumps and pump supplies qualify as durable medical equipment under FSA rules. This includes infusion sets, reservoirs, cartridges, and insertion devices.
Alcohol prep pads used for sanitizing injection sites before insulin administration are eligible supplies.
Diabetes Management Accessories
Sharps containers for safe disposal of used lancets and syringes qualify as medical waste management supplies.
Glucose tablets and gels for treating hypoglycemia (low blood sugar) are FSA-eligible as medical treatment supplies.
Diabetic testing control solution used to verify meter accuracy qualifies for reimbursement.
Insulin cooling cases and diabetic supply organizers designed for safe insulin storage meet FSA requirements as durable medical equipment.
Browse FSA-eligible diabetic supplies including glucose monitors, test strips, and insulin delivery products.
Diabetic Supplies That Don't Qualify
General nutritional supplements marketed for blood sugar control but not prescribed for diabetes treatment don't meet FSA requirements.
Diabetic cookbooks, food scales, or meal planning apps fall under general wellness rather than medical treatment.
Standard gym memberships aren't FSA-eligible even though exercise helps manage diabetes, unless specifically prescribed for disease treatment with detailed documentation.
Urological Supplies: Catheters and Related Products
Individuals requiring catheterization for urinary retention, neurogenic bladder, or other urological conditions can use FSA funds for virtually all related supplies.
Intermittent Catheters
Straight tip intermittent catheters in all French sizes and lengths qualify for FSA reimbursement. This includes male-length (16"), female-length (6-8"), and pediatric catheters.
Coude tip catheters with curved tips designed to navigate urethral strictures or enlarged prostates are FSA-eligible.
Hydrophilic catheters with specialized coatings that activate with water are covered as advanced medical devices.
Closed system catheters featuring integrated collection bags qualify as complete catheterization systems.
Pre-lubricated catheters ready to use immediately from the package are eligible regardless of lubrication method (gel or hydrophilic coating).
External and Indwelling Catheters
External catheters (condom catheters) for male incontinence management are FSA-eligible as medical devices.
Foley catheters and indwelling catheter supplies including drainage bags, leg straps, and catheter securement devices all qualify.
Catheter insertion trays containing sterile supplies for safe catheterization are eligible as complete medical kits.
Catheterization Accessories
Catheter lubricants and lidocaine gels designed for comfortable insertion qualify as medical supplies.
Drainage bags including leg bags, bedside bags, and overnight drainage systems are FSA-eligible.
Catheter leg straps and securement devices that prevent catheter movement and urethral trauma qualify for reimbursement.
Catheter valve systems allowing bladder control without continuous drainage are covered as advanced medical devices.
Incontinence Products: FSA Eligibility Guidelines
Adult incontinence products qualify for FSA reimbursement when used to treat diagnosed medical conditions causing urinary or bowel incontinence.
Absorbent Incontinence Products
Adult briefs and protective underwear designed for moderate to heavy incontinence are FSA-eligible when medically necessary.
Incontinence pads and liners for light to moderate protection qualify for reimbursement.
Underpads (chux) protecting bedding and furniture from incontinence are covered as medical supplies.
Belted undergarments and fixation pants designed to hold pads securely qualify as adaptive medical equipment.
Incontinence Care Accessories
Skin barrier creams and ointments preventing moisture-related skin breakdown from incontinence are FSA-eligible.
Incontinence cleansing wipes and no-rinse cleansers for personal hygiene management qualify when used for medical incontinence care.
Odor-control products specifically designed for medical incontinence management are eligible.
Documentation Requirements for Incontinence Products
Many FSA administrators request a Letter of Medical Necessity (LMN) for incontinence products to confirm medical rather than convenience use. Your healthcare provider can provide this simple documentation stating you have a diagnosed condition requiring incontinence management supplies.
Year-End FSA Strategies: Don't Lose Your Funds
As the plan year approaches its end, strategic purchasing ensures you maximize FSA benefits without forfeiting unused funds.
Stock Up on Shelf-Stable Supplies
Estimate quarterly needs and purchase accordingly. If you use 90 ostomy pouches per quarter, purchasing 180 pouches in December gives you a six-month supply while using expiring FSA funds. Check expiration dates before bulk buying. Most medical supplies have 2-3 year shelf lives, but verify before purchasing large quantities. Prioritize expensive supplies first. Use remaining FSA funds on higher-cost items like glucose monitors, CGM supplies, or premium catheters before spending on everyday items.Plan for Predictable Expenses
Schedule routine medical appointments before year-end if you have remaining FSA funds, allowing you to apply FSA dollars toward copays and deductibles.
Refill prescriptions early if your plan year ends mid-prescription cycle.
Purchase backup supplies like extra glucose meters, thermometers, or blood pressure monitors while funds remain.
Smart Shopping Tips
Document medical necessity for any borderline products. A simple note from your doctor confirming you need specific supplies for a diagnosed condition prevents disputes.
Use detailed product descriptions when submitting manual claims. "Ostomy pouching system for ileostomy management" is better than just "medical supplies."
FSA Shopping: Best Practices for Purchases
Understanding FSA Card vs. Reimbursement
FSA debit cards link directly to your account, allowing immediate purchases at medical providers and retailers coded for FSA transactions. These cards simplify the process but may flag certain purchases for substantiation.
Manual reimbursement requires you to pay out-of-pocket, then submit itemized receipts to your FSA administrator for reimbursement. This method works for any eligible purchase regardless of retailer.
Online medical supply retailers like Best Buy Medical Supplies typically process FSA card transactions smoothly since the business is coded for medical equipment sales.
What Information You Need to Submit Claims
Itemized receipts showing:- Date of purchase
- Merchant name and address
- Item descriptions (not just "medical supplies")
- Individual item costs
- Total amount paid
Common FSA Claim Denials and How to Avoid Them
"Insufficient documentation" - Always provide itemized receipts showing exactly what you purchased, not just credit card statements. "Product not FSA-eligible" - Sometimes occurs when product descriptions are vague. Resubmit with clearer documentation of the item's medical purpose. "Missing prescription" - Occurs when administrators incorrectly think supplies need prescriptions. Cite the CARES Act changes and relevant IRS codes (IRC 213(d)) in your appeal. "Not medically necessary" - Common with incontinence products. Provide a Letter of Medical Necessity from your physician documenting your condition.FSA vs. HSA: Understanding the Difference
Some people confuse FSAs with Health Savings Accounts (HSAs). While both offer tax advantages for medical expenses, they function differently.
Key FSA Characteristics
Employer-owned accounts - Your employer technically owns your FSA. If you leave your job, you typically forfeit remaining funds unless you elect COBRA. Annual deadline pressure - The use-it-or-lose-it rule (with possible limited carryover or grace period) requires careful spending planning. No investment options - FSA funds sit in the account without earning interest or investment returns. Available regardless of insurance type - You can have an FSA with any health insurance plan your employer offers.Key HSA Characteristics
Employee-owned accounts - You own your HSA permanently. Funds roll over indefinitely and follow you between jobs. No spending deadlines - Unused HSA funds remain available for future medical expenses without annual pressure to spend. Investment opportunities - Many HSAs allow investing balances above certain thresholds, potentially growing tax-free for retirement medical expenses. High-deductible health plan requirement - You must be enrolled in an HDHP to contribute to an HSA.Both account types cover the same medical supplies discussed in this guide. FSA and HSA funds are interchangeable for purchasing ostomy supplies, diabetic equipment, catheters, and incontinence products.
Special Situations: FSA Use for Dependents and Family Members
Your FSA can cover eligible medical expenses for your spouse and dependents, significantly expanding the account's value.
Dependent Coverage
Tax dependents qualify for FSA reimbursement regardless of age. This includes children under 27 covered on your health insurance, plus older dependents you claim on your taxes.
Adult children with disabilities may remain FSA-eligible dependents past age 26 if they meet IRS dependency requirements.
Elderly parents you claim as dependents can have their medical supplies covered by your FSA, including incontinence products, diabetic supplies, or other needs.
Domestic Partner Considerations
Legally married spouses automatically qualify for FSA coverage of their medical expenses.
Domestic partners generally only qualify if they meet IRS dependent requirements, which typically means you provide more than 50% of their financial support and claim them as a dependent on your taxes.
FSA Planning for Chronic Conditions: Long-Term Strategy
Managing chronic conditions requiring ongoing medical supplies makes FSA accounts particularly valuable for long-term savings.
Multi-Year FSA Contribution Planning
Year one: Establish baseline - Track actual supply spending carefully for 12 months to understand true costs. Year two: Optimize contribution - Set FSA contributions slightly below your annual spending to avoid forfeiture risk while maximizing tax savings. Year three and beyond: Adjust as needed - Increase contributions if your condition requires additional supplies; decrease if treatment improves or insurance coverage changes.Coordinating FSA with Insurance Benefits
Supplement insurance-provided supplies with FSA funds. If insurance covers 90 ostomy pouches monthly but you need 120, use FSA dollars for the additional 30.
Bridge insurance coverage gaps during benefit year resets or when you've exhausted allowances.
Cover out-of-pocket costs like deductibles and copays for medical appointments related to your condition.
Pay for premium products not covered by insurance, such as upgrading from basic catheters to closed-system options for convenience.
The Bottom Line
Flexible Spending Accounts offer significant tax savings on medical supplies you're purchasing anyway. The key to maximizing benefits is understanding eligibility, planning contributions carefully, and keeping organized records.
Key takeaways:- Virtually all ostomy, diabetic, catheter, and medically-necessary incontinence supplies are FSA-eligible
- The CARES Act eliminated prescription requirements for most products
- Calculate annual supply needs before setting contribution amounts
- Keep detailed records including itemized receipts and medical necessity documentation
- Use remaining funds strategically on shelf-stable supplies before year-end
- FSA cards simplify purchasing at medical supply retailers
Browse our complete selection:
- Ostomy supplies - Pouching systems, barriers, accessories
- Diabetic supplies - Glucose monitors, test strips, syringes
- Urology products - Catheters, drainage bags, supplies
- Incontinence products - Protective underwear, briefs, pads
Don't leave tax-free money on the table. Your FSA exists to make essential medical supplies more affordable-use it strategically to reduce your annual healthcare costs by 25-35%.