Do You Have a Letter of Medical Necessity?

A letter of medical necessity (LOMN) is a document from your licensed healthcare provider recommending a particular treatment, product, or equipment for medical purposes. 
 
The LOMN is also required to reimburse medical procedures, supplies, or equipment when you use a health savings account (HSA) or flexible spending account (FSA).

Do You Have a Letter of Medical Necessity?
By Pierre Mouchette | Bits-n-Pieces

Health insurance typically covers various services and products, such as doctor visits, hospital stays, prescription drugs, and medical equipment.  But some items such as vitamins, supplements, and exercise equipment are not covered.
You can use your health savings account (HSA) or flexible spending account (FSA) to pay for certain expenses not covered by insurance.  However, suppose your expenses are not considered qualified medical expenses by the IRS. In that case, you may need a letter of medical necessity (LOMN) from your healthcare provider to verify that your products or services are necessary for your health.
 
What is The Purpose Of a Letter Of Medical Necessity?
A letter of medical necessity explains why your healthcare provider recommended a specific treatment or product.  The document verifies that your medical expense is for diagnosing, treating, or preventing a disease or medical condition.  If your expense does not meet these requirements, it will not be considered an eligible expense by the IRS.
For example, your doctor recommends that you take iron supplements to treat iron-deficiency anemia. You will need a LOMN to obtain reimbursement using an HSA or FSA.  These tax-advantaged accounts allow you to set aside pre-tax dollars to pay for qualified healthcare expenses.  Essentially, a LOMN is to prove that your costs are for medical purposes instead of general health.
 
When is a Letter of Medical Necessity Required?
You will need a LOMN for a medical procedure or product that an insurance provider excludes from coverage.  The following organizations may require a LOMN:

• Flexible spending account (FSA) provider
• Government healthcare insurance programs like Medicaid or Medicare
• Health savings account (HSA) provider
• Private insurance company

The IRS may need a letter of medical necessity for you to receive favorable tax treatment, which includes taking deductions for medical expenses when using HSAs.
 
What Are Some Items That Require a Letter of Medical Necessity?
Suppose it is not clear if your healthcare product or service is considered a qualified expense under your insurance plan or tax-advantaged medical account.  It is essential to contact your insurance provider to get a better understanding of what is covered.  If you have an FSA or HSA, you can call your account custodian to determine if the expenditure is allowed for reimbursement.  They may require a LOMN for certain purchases.
Other examples of medical necessity letters are:

• The IRS provides a list of qualified medical expenses.  Generally, expenditures not listed need a letter of medical necessity.  
• An insurance company may require a LOMN when a treatment or item is excluded from coverage. 
• Medicare has its template, called a certificate of medical necessity.  It is generally for claims involving durable medical equipment (DME).

 
Who writes a letter of medical necessity?
Generally, your healthcare provider writes and signs the LOMN.  It will help improve the odds of getting approval for a medical procedure or item.  However, a LOMN does not guarantee acceptance.
The healthcare provider who writes the LOMN must be the person who has treated you.  You should also check with your insurance plan provider to see what type of healthcare professional they want to submit the letter of medical necessity.
 
 
What Does a Letter of Medical Necessity Include?
Some insurance providers or account custodians may provide you with a template for your LOMN.  But, generally, your healthcare provider needs to include the following information:

• Patient name and medical history
• Diagnosis
• The medical treatment or item required (If you do not show why it is medically necessary, an insurance company, government, or benefits provider may reject the claim)
• Date, the letter of medical necessity, was written
• Duration of the treatment
• Relationship to the patient, contact information, and signature

 
What Does a Letter of Medical Necessity Contain?
It is essential to have a detailed description of the medical condition.  You should provide medical history, including any past treatments.  Next, you must show how the treatment or healthcare item will diagnose or improve an illness or injury.  You can provide clinical studies and research.  You also must state the length of time for the treatment or healthcare item.
The letter of necessity should not be a demand. The focus is instead on why the recommendation is medically necessary for the patient.
 
For How Long is a Letter of Medical Necessity Good?
A LOMN usually specifies the duration of the treatment or how long you will use the medical item.  If you exceed this, you will need to get a new letter of medical necessity.  If not, you may not get reimbursement for the expenses incurred after the LOMN expires.  If the letter of medical condition does not state a duration, it typically lasts one year.  After this, you will need to get a new LOMN.
 
Note:  the LOMN will need to be submitted to the insurance company.  If the insurance company denies the claim, you can then use the insurance company’s appeal process.