Does Insurance Cover CBD?
Otherwise known as Obamacare, this act states that it was implemented in an effort to boost the nation’s economy via mandating a majority of the population to purchase their own health insurance plans if not provided one as a benefit of employment.
According to the Center on Budget and Policy Priorities, this goal has been met, at least with regard to Medicaid since the projected costs of operating this federal program in 2019 was $794 billion, yet is now 21.5 percent less than anticipated, or $623 billion. 
Though, if you ask the general public their thoughts on this program, the response is more mixed.
For some, this act was a blessing because it afforded people the opportunity to purchase health insurance at a reasonable rate regardless of any pre-existing health conditions. For others, specifically those who had previously gone without insurance in an effort to save cash, it created an additional financial burden or face the risk of being assessed a fine.
Either way, this act has forced United States citizens to really question their insurance policy and the benefits it provides. And one benefit a number of people are wondering about is whether insurance providers are required to pay for CBD (cannabidiol) when it is taken for its health benefits. In other words, does health insurance cover CBD oil?
In the past, this lack of accepted medical use and safety has been, in part, due to a lack of research thanks to hemp’s illegal status. However, actions being taken by federal agencies such as the U.S. Food and Drug Administration (FDA) could begin to change this reasoning, particularly by this agency approving the first ever prescription drug to include a marijuana derivative.
This was in June of 2018 and that drug was Epidiolex. Epidiolex can now be prescribed to help reduce difficult-to-control seizures in patients suffering from two fairly rare forms of epilepsy: Dravet syndrome and Lennox-Gastaut syndrome.
While this is one step closer to the legalization of medical marijuana, it doesn’t change the fact that this particular drug is still illegal on a federal level and, therefore, enforceable by the Drug Enforcement Administration (DEA). This is even though some states have legalized medical marijuana and/or marijuana used for recreational purposes.
Does this mean that you can’t get any help with covering the cost of products that contain cannabinoids such as CBD ? According to what some people are discovering, the answer is no.
The store further states that “the IRS [Internal Revenue Service] has yet to issue guidance on the eligibility status of CBD oil and products,” so maybe some HSA plans are taking this absence of guidance as implied approval of CBD -containing products?
The IRS Publication 502, which is titled “Medical and Dental Expenses,” states that controlled substances such as marijuana are not deductible as a medical expense and neither are nonprescription drugs and medicines, with the exception of insulin.
Can i use my hsa account for cbd oil
With the rise of natural and organic remedies and the change in public perception surrounding cannabis, it’s no surprise that CBD has become increasingly popular in the last few years. You’ll see its benefits touted by everyone from professional athletes to the arthritic elderly, promoting it as a milder alternative to prescription pain medication.
But the legality surrounding CBD is still undefined by the IRS, which has implications for FSA eligibility. Regardless, here’s what you might want to know about CBD (after speaking with your doctor, of course).
What is CBD?
CBD or cannabidiol is extracted from a specific variety of cannabis, usually hemp. Hemp plants contain little to no traces of THC, the psychoactive element found in marijuana.
A common misconception is that since CBD is related to marijuana, it will get you “high.” But because most forms of commercial CBD have no THC in them, you won’t feel that traditional sense of high after ingestion.
CBD is technically legal in all 50 states as long it’s derived from hemp. THC-derived CBD is legal in the following states: Alabama, Georgia, Indiana, Iowa, Kansas, Kentucky, Mississippi, North Carolina, South Carolina, Tennessee, Texas, Virginia, Wisconsin and Wyoming.
Of course, there are experts with more details on the subject. The National Organization for the Reform of Marijuana Laws (NORML) has more information on what CBD products are legal in your state.
What is CBD used for?
Proponents of CBD claim its benefits include reduced anxiety, inflammation, arthritis and overall pain relief. Unlike prescription medication, there are few adverse side effects from CBD. Patients generally cannot become addicted to CBD, which can make it preferable to traditional pain pills. In 2018, the FDA approved a CBD-based drug to treat seizures for people with a rare type of epilepsy.
CBD usually comes in a few different forms, including oil, tablets and creams. Many veterinarians even sell CBD products for animal anxiety.
Where to find CBD
You can find CBD products anywhere from gas stations to health food stores. Unfortunately, regulation of CBD products can be lax in many states, leading to questions about the quality and purity of individual products.
To find quality CBD products, some people suggest buying products manufactured in Colorado, where regulation is stricter. You can also look up a CBD product’s certificate of authenticity to make sure it’s been properly tested.
(Again, we’re not medical professionals – always speak with your doctor before making any changes to your medical routine.)
So, can you use an FSA for CBD?
CBD products are probably not considered HSA- or FSA-eligible, though there hasn’t been any formal guidance from the IRS on the matter. This is similar to medical marijuana, which is also not HSA or FSA-eligible even if you’re taking it for a diagnosed disorder or to reduce the effects of chemotherapy.
While medical marijuana is legal in 33 states and the District of Columbia, including the 10 states where both recreational and medical marijuana are legal, it is not yet federally legal, and therefore not eligible for reimbursement. It appears that CBD products — even if they’re not derived from marijuana — are being categorized similarly.
As of today, if you use your HSA for medical marijuana or CBD, you’ll pay income tax and an extra 20% penalty on any forbidden distributions from your account. If you use an FSA, you’ll likely be asked to pay back your account. Because of this, remember to always buy CBD products with your regular debit or credit card to avoid any confusion and penalties.
From FSA basics to the most specific account details, in our Asked and Answered column, our team gets to the bottom of your most-pressing flex spending questions. It appears on Wednesdays, exclusively on the FSAstore.com Learning Center. And for the latest info about your health and financial wellness, be sure to follow us on Facebook, Instagram and Twitter.