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First published: February 1, 2026 / Last updated: February 27, 2026

What is a Letter of Medical Necessity (LMN) and when do you need one?

A Letter of Medical Necessity (LMN) is a document from a licensed healthcare provider that explains why a specific product or service is medically necessary to treat, diagnose, or prevent a medical condition.

If you use a Health Savings Account (HSA) or a Flexible Spending Account (FSA), an LMN can be the difference between an expense being reimbursable or not.

What is a Letter of Medical Necessity?

An LMN is a written statement from a healthcare provider (such as a physician, nurse practitioner, or specialist) that:

  • Identifies a diagnosed medical condition
  • Explains how a specific item or service treats or manages that condition
  • Confirms the expense is not primarily for general health or personal use

Many health-related items fall into a gray area under IRS rules. An LMN helps show that an expense meets the definition of a qualified medical expense.

When do you need a Letter of Medical Necessity?

You typically need an LMN when an item is dual-purpose, meaning it could be used for general wellness but may also be used to treat a specific medical condition.

Common examples include:

  • Fitness trackers or smartwatches
  • Massage therapy
  • Special exercise programs
  • Supplements or vitamins
  • Orthopedic shoes or inserts

Without an LMN, these expenses are usually considered personal and not eligible for HSA or FSA reimbursement.

Key point: An LMN does not automatically make an expense eligible. It supports eligibility when the item is clearly tied to treating or managing a specific condition.

Example: is an Apple Watch HSA-eligible?

On its own, an Apple Watch is generally not considered an HSA-eligible expense because it is primarily a consumer fitness and lifestyle device.

However, if your provider recommends an Apple Watch to monitor a specific medical condition (for example, heart rhythm irregularities) it may qualify with a valid LMN that clearly explains the medical purpose.

You can read the full breakdown here: Are Apple Watches HSA-eligible?

Important: The LMN must explain the medical purpose. General goals like "fitness," "wellness," or "weight loss" are usually not enough by themselves.

What should a Letter of Medical Necessity include?

While formats vary, a strong LMN usually includes:

  • Patient name
  • Diagnosed medical condition
  • Description of the recommended product or service
  • Explanation of how it treats or manages the condition
  • Length of time the expense is medically necessary
  • Provider signature and date
Pro tip: Put the provider's credentials on the letterhead (for example, license type and practice details). Some administrators may also ask for identifiers like an NPI number, especially for higher-cost or recurring expenses.

Some administrators require the LMN to be renewed annually, especially for ongoing expenses.

Example Letter of Medical Necessity

[Doctor's Name]
[Doctor's Address]
[Doctor's City, State ZIP Code]

[Date]

[Insurance Company Name]
[Insurance Company Address]
[City, State ZIP Code]

Re: [Patient's Name]
[Insurance Policy Number]

To Whom It May Concern:

I am writing to certify that [Item Name] is medically necessary for the treatment and monitoring of [Patient Name]'s diagnosed medical condition: [Diagnosis].

The [Item Name] will be used to: [Explain how the device supports diagnosis, treatment, monitoring, or management of the condition.]

This device is a required component of the patient's treatment plan and is not intended for general wellness or fitness use.

Sincerely,

[Doctor's Name]
[Doctor's Title]
[Doctor's Contact Information]

Enclosure(s): [List any relevant medical results included as evidence of medical necessity]

Do you need to submit the LMN?

In many cases, you do not submit an LMN at the time of purchase. Instead:

  • Keep the LMN with your tax records
  • Save receipts for the related expenses
  • Provide documentation only if your HSA or FSA administrator requests it
Reminder: HSAs are generally enforced through self-reporting. If you are ever audited, the LMN and your receipts are what support that the expense was qualified.

Final thoughts

A Letter of Medical Necessity does not make everything HSA-eligible, but it can unlock reimbursement for expenses that genuinely treat a medical condition.

When in doubt, ask your healthcare provider whether an LMN is appropriate and keep thorough documentation. It is one of the simplest ways to stay compliant while getting the most value from your HSA.

Sources

Disclaimer

This page is for educational purposes only and is not tax or legal advice. Check with your HSA administrator or a qualified tax or legal professional if you have questions about your specific situation.

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