Cord Blood Storage: HSA Eligibility

Cord Blood Storage: requires a Letter of Medical Necessity (LMN) to be eligible with a Health Savings Account (HSA)

Cord blood storage is sometimes eligible with a Letter of Medical Necessity (LMN) from a physician if it is to treat an existing or imminently probable disease with a flexible spending account (FSA), health savings account (HSA) or a health reimbursement arrangement (HRA). Cord blood storage reimbursement is not eligible with a limited care flexible spending account (LCFSA) or a dependent care flexible spending account (DCFSA).

What is cord blood storage?

While the vast majority of blood storage is conducted for public use, individuals can pay for the services of a cord blood bank in anticipation of treating an existing or imminently probable disease that may develop over the course of their child's life. When a baby is born, parents will have the option to store the blood found inside the umbilical cord of a newborn baby, which is rich in blood stem cells, which have the ability to reproduce themselves into other types of cells. These cells can play a vital role in treating medical conditions like leukemia, sickle cell anemia or lymphoma, as injecting these cells can replenish a patient's blood supply with new, healthy cells. Cord blood cells can also be used to help the body recover from intensive cancer treatments like chemotherapy or radiation (ViaCord).

When a child is born, parents will have the option of paying to preserve this cord blood for their family member's future use by paying to store it in a private cord blood bank, having it disposed of or donating it to a public bank so it can be freely used by medical professionals to treat a wide range of potential medical conditions (American Pregnancy Association). While benefits administrators can vary in their rulings of whether blood storage is an eligible medical expense, a Letter of Medical Necessity (LMN) from a physician is recommended for reimbursement. This will outline how blood storage will be used to treat an existing medical condition, or if a child has shown a predisposition for a certain illness that is imminently probable, it will most likely be eligible for reimbursement through a consumer-directed healthcare plan.

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Specifically Not Covered

Cord blood storage as a precautionary measure to treat a disease that may or may not develop in the future is not eligible.