Distilled water is typically not eligible for reimbursement with a Flexible Spending Account (FSA) or Health Savings Account (HSA). However, it may qualify when purchased specifically for use with certain eligible medical devices.
Why Is Distilled Water Not Generally FSA/HSA Eligible?
Distilled water is considered a grocery or household item rather than medical care under IRS Code Section 213(d). When purchased for drinking, cooking, formula preparation, or household use, it does not diagnose, treat, or prevent a medical condition and is therefore not eligible.
Under IRS guidance in IRS Publication 502, eligible expenses must be primarily for medical care. General household supplies and food or beverage products are excluded.
What’s Not Covered?
Distilled water purchased for drinking or hydration
Distilled water used for baby formula preparation
Distilled water for humidifiers unrelated to medical equipment
Bulk distilled water for household or appliance use
LMN and Exceptions
Distilled water may qualify when it is required for the operation of an eligible medical device, such as:
CPAP or BiPAP machines
Certain respiratory therapy devices
Medically prescribed humidifiers or nebulizers
In these cases, the distilled water is considered a necessary supply for the functioning of durable medical equipment (DME), which may make it eligible.
To pursue reimbursement:
Confirm that the medical device itself is FSA/HSA eligible.
Retain receipts showing the distilled water purchase.
Be prepared to demonstrate that the water is used specifically for the medical device if requested by your administrator.
An LMN is not typically required when distilled water is clearly tied to eligible medical equipment. However, if purchased in larger quantities or in ambiguous circumstances, your administrator may request documentation.
When purchased for general use or convenience, distilled water remains ineligible for FSA or HSA reimbursement.
