What a Health Savings Account covers
A Health Savings Account (HSA) lets you spend money on medical expenses without paying federal income tax on that money. The IRS publishes a list of what counts as a medical expense, and it is longer than most people expect — it includes not just doctor visits and prescriptions, but also dental work, vision care, mental health treatment, and some over-the-counter items.
The catch is that the expense has to be for you, your spouse, or a dependent you claim on your taxes. You cannot use HSA funds to pay for someone else's medical care unless they are your dependent. And the expense cannot be something your health insurance already paid for — you can only use HSA money for costs you are responsible for out of your own pocket.
If you spend HSA money on something that is not a may have access to medical expense, you owe income tax on that amount plus a 20 percent penalty. The IRS does audit HSA spending, so keeping receipts and records matters.
Key Takeaways
- HSA funds cover doctor visits, hospital stays, prescriptions, dental work, vision care, and mental health treatment without federal income tax.
- Many over-the-counter items may have access to — including pain relievers, allergy medicine, first aid supplies, and medical equipment — but only if you have a prescription or doctor's note for them.
- You cannot use HSA money for health insurance premiums, cosmetic procedures, or general wellness items like vitamins or gym memberships unless a doctor prescribes them for a specific condition.
- Keeping receipts and records is essential because the IRS can audit HSA spending, and non-may have access to expenses trigger both income tax and a 20 percent penalty.
Medical services and treatments covered by HSA
Doctor visits, hospital stays, surgery, and urgent care are all covered. This includes the cost of the visit itself, any tests or imaging the doctor orders, and any procedures performed. Mental health treatment — therapy, counseling, and psychiatric care — is covered whether you see a therapist in person or through telehealth.
Prescription medications are covered. Over-the-counter medications are covered only if a doctor writes a prescription for them or includes them in a written treatment plan. For example, if your doctor prescribes ibuprofen as part of your arthritis treatment, you can buy it with HSA funds; if you buy ibuprofen on your own for a headache, you cannot.
Dental work is covered — cleanings, fillings, root canals, extractions, and orthodontia all count. Vision care is covered too: eye exams, glasses, contact lenses, and laser eye surgery. Hearing aids and hearing tests are covered. Physical therapy, chiropractic care, and acupuncture are covered if a doctor refers you or if your state licenses the provider.
Over-the-counter items you can and cannot buy
The rule for over-the-counter items is simple: they are covered only if a doctor prescribes them or includes them in a written treatment plan. A prescription does not have to come from a pharmacy — a doctor's note saying "use ibuprofen 400 mg twice daily for knee pain" is enough.
Items that commonly may have access to include pain relievers (ibuprofen, acetaminophen, aspirin), allergy and cold medicine, antacids, anti-diarrheal medication, topical creams for rashes or pain, and first aid supplies like bandages and antiseptic. Glucose monitors and test strips for diabetes are covered. Crutches, braces, heating pads, and ice packs are covered if they are medical equipment rather than general wellness items.
Items that do not may have access to include vitamins and supplements (unless a doctor prescribes them for a specific deficiency), cosmetics, sunscreen, toothpaste, shampoo, deodorant, and general wellness products. Gym memberships and fitness equipment do not may have access to even if you use them for health reasons, unless a doctor prescribes exercise as treatment for a specific condition — and even then, the gym membership itself may not may have access to, only the cost of medically necessary physical therapy.
What HSA funds cannot cover
Health insurance premiums are generally not covered, with three exceptions: you can use HSA funds to pay premiums for COBRA coverage (continuation coverage after job loss), for health insurance while you are receiving unemployment benefits, and for long-term care insurance. You cannot use HSA funds to pay premiums for your regular employer or individual health insurance.
Cosmetic procedures are not covered unless they are medically necessary. A facelift is not covered; surgery to repair a deviated septum that affects breathing is covered. Teeth whitening is not covered; a root canal is. The distinction is whether the procedure treats a medical condition or is purely for appearance.
Anything related to general wellness that is not prescribed for a specific condition does not may have access to. This includes gym memberships, fitness classes, diet programs, and most supplements. Maternity clothes, baby formula, and childcare are not covered. Travel to receive medical treatment is not covered, though the medical treatment itself is.
How to document and track HSA spending
Keep receipts for everything you buy with HSA funds. The receipt should show what you bought, the date, the amount, and ideally the provider's name. If you use your HSA debit card, the transaction will appear on your statement, but the statement alone may not be enough proof if the IRS asks — you need the actual receipt showing what the charge was for.
For prescriptions, keep the pharmacy receipt. For doctor visits, keep the bill or explanation of benefits from your insurance. For over-the-counter items bought with a prescription, keep both the receipt and the prescription or doctor's note. If you are unsure whether something qualifies, ask your HSA administrator or your doctor before you buy it.
The IRS does not require you to submit receipts when you withdraw money from your HSA, but you must be able to produce them if audited. Audits can happen years after the purchase, so keep records for at least three to seven years. Many HSA administrators offer online portals where you can upload receipts and track which expenses you have documented.
Special situations: dependent care and other exceptions
If you have a dependent you claim on your taxes, their medical expenses are covered by your HSA. This includes your children, your spouse, and sometimes your parents or other relatives if you provide more than half their financial support and they live with you or meet other IRS tests.
If you are over 65, you can withdraw money from your HSA for any reason without the 20 percent penalty — you will owe income tax on non-medical withdrawals, but not the penalty. This makes HSA a useful retirement savings tool if you have other money to pay for medical expenses while you are younger.
If you are on Medicare, you cannot contribute new money to an HSA, but you can still withdraw money from an existing HSA for may have access to medical expenses. Some Medicare premiums and out-of-pocket costs may have access to, but not all — check with your HSA administrator about what Medicare-related expenses they cover.
Frequently Asked Questions
Can I use my HSA to buy vitamins or supplements?
Only if a doctor prescribes them for a specific medical condition, such as a vitamin D deficiency or iron deficiency. General wellness vitamins and supplements do not may have access to, even if you take them regularly for health. Keep the prescription or doctor's note if you buy them.
What happens if I spend HSA money on something that does not may have access to?
You owe federal income tax on that amount plus a 20 percent penalty. For example, if you spend $100 on something non-may have access to and you are in the 22 percent tax bracket, you would owe $42 in taxes and penalties combined. Keep receipts so you can prove what you bought if the IRS asks.
Can I use my HSA to pay for my spouse's medical expenses?
Yes, as long as you are married and file taxes jointly or separately. Your spouse's medical expenses count as may have access to expenses under your HSA. You do not need to be on the same health insurance plan.
Does my HSA cover therapy or counseling?
Yes. Mental health treatment, including therapy, counseling, and psychiatric care, is covered whether you see a provider in person or through telehealth. The cost of the visit and any prescribed medications are both covered.
Can I use HSA funds to pay for a gym membership if my doctor recommends exercise?
Usually not. Even if a doctor recommends exercise, a gym membership itself does not may have access to. However, if a doctor prescribes physical therapy at a clinic or with a physical therapist, that cost is covered. The distinction is between general fitness and medically prescribed treatment.