You can use HSA funds for medical expenses that your insurance doesn't cover, and for some costs that insurance does cover but you choose to pay out of pocket

A Health Savings Account lets you spend money on may have access to medical expenses without paying federal income tax on that money. The IRS maintains a specific list of what counts as may have access to, and it's broader than most people think — it includes dental work, vision care, mental health treatment, and many over-the-counter items. The catch is that if you spend HSA money on something that's not on the IRS list, you'll owe income tax on that amount plus a 20% penalty.

The may have access to expenses fall into a few categories: things your insurance plan won't pay for at all, things your insurance covers but you're paying out of pocket anyway, and specific items the IRS allows even if insurance would cover them. Understanding which bucket your expense falls into matters, because the tax consequences are different.

Key Takeaways

  • You can spend HSA money on deductibles, copays, coinsurance, and any medical expense your insurance doesn't cover.
  • Dental work, vision care, hearing aids, and mental health treatment are all may have access to expenses, even if your insurance doesn't cover them.
  • Over-the-counter medications like pain relievers and allergy medicine are may have access to, but only if you have a prescription or doctor's note for them.
  • You cannot use HSA funds for cosmetic procedures, gym memberships, vitamins, or insurance premiums (with rare exceptions for COBRA and long-term care).
  • Keep receipts and documentation for every HSA purchase in case the IRS asks you to prove the expense was may have access to.

Medical expenses your insurance plan covers

If your insurance pays for something, you can still use your HSA to cover your share of the cost — your deductible, copay, or coinsurance. This is one of the most common uses of HSA money. You're not double-dipping; you're using pre-tax money to pay the portion of the bill that falls to you.

This applies to any service your plan covers: doctor visits, hospital stays, surgery, lab work, imaging, prescription drugs, and therapy. The fact that your insurance is paying part of the bill doesn't make your portion ineligible. You can also use HSA money to pay the full cost of a service if you choose to pay out of pocket instead of using insurance.

Medical expenses your insurance doesn't cover

Many insurance plans have gaps. They might not cover dental work, vision care, hearing aids, or mental health treatment. If your plan doesn't cover it, you can use HSA money to pay for it in full — and it's still a may have access to expense.

This is where HSAs become especially valuable. Someone with a high-deductible health plan might have no dental coverage at all; they can use their HSA to pay for cleanings, fillings, root canals, and crowns. The same applies to glasses, contact lenses, eye exams, and hearing aids. Mental health services, including therapy and psychiatric care, are may have access to expenses whether or not your insurance covers them.

Fertility treatment, including IVF and related procedures, is also may have access to. So are acupuncture, chiropractic care, and some alternative treatments — though the IRS has specific rules about which ones, so check before you spend.

Over-the-counter medications and supplies

You can use HSA money for over-the-counter pain relievers, allergy medicine, cold medicine, antacids, and similar items — but only if you have a prescription or a written note from your doctor saying you need it. Without that documentation, the IRS considers it ineligible.

Medical supplies like bandages, thermometers, blood pressure monitors, and glucose monitors are may have access to without a prescription. First aid kits and heating pads count too. The rule is roughly: if it's a supply or device meant to treat a medical condition, it's likely may have access to. If it's a general wellness product, it's not.

Sunscreen, cosmetic products, and vitamins are not may have access to, even if you buy them at a pharmacy. Toothpaste and toothbrushes are not may have access to either, though dental work itself is.

What you cannot use HSA money for

Cosmetic procedures — including teeth whitening, Botox, and elective plastic surgery — are not may have access to expenses. The exception is if the procedure is medically necessary to treat an injury or disease; reconstructive surgery after an accident or burn would be may have access to, but cosmetic enhancement would not.

Gym memberships and fitness classes are not may have access to, even if your doctor recommends exercise. General wellness products like vitamins and supplements are not may have access to. Cosmetic dental work like veneers or bonding for appearance only is not may have access to, though dental work to treat decay or disease is.

Insurance premiums are generally not may have access to, with two exceptions: you can use HSA money to pay premiums for COBRA continuation coverage (if you've lost employer coverage), and you can use it to pay premiums for long-term care insurance. You cannot use it for your regular health insurance premium, your car insurance, or any other type of insurance.

How to document HSA spending

The IRS doesn't require you to submit receipts when you spend HSA money, but you must keep them. If the IRS audits your account, you'll need to prove that every dollar you withdrew was spent on a may have access to expense. A receipt showing what you bought, when, and how much you paid is your proof.

For large expenses or anything that might be questioned — like mental health treatment or alternative medicine — keep the receipt plus any documentation from your provider showing what service was rendered. If you paid out of pocket and reimbursed yourself from your HSA later, keep the receipt and a record of when you withdrew the money.

Many HSA providers offer debit cards that you can use at pharmacies and medical offices, which creates an automatic record. Others require you to submit receipts to get reimbursed. Either way, the burden is on you to keep the documentation.

Frequently Asked Questions

Can I use my HSA to pay for my spouse's or child's medical expenses?

Yes. You can use your HSA to pay for may have access to medical expenses for your spouse and any dependent you claim on your tax return, even if they're not covered by your health plan. This is one reason HSAs are valuable for families — one person's account can cover the whole household's may have access to expenses.

What happens if I spend HSA money on something that's not may have access to?

You'll owe federal income tax on that amount, plus a 20% penalty. So if you withdraw $500 for a non-may have access to expense and you're in the 22% tax bracket, you'd owe roughly $110 in taxes and penalties. Keep receipts so you can prove an expense was may have access to if questioned.

Can I use HSA money for prescription glasses or contacts?

Yes. Glasses, contact lenses, eye exams, and corrective surgery like LASIK are all may have access to expenses. You can use your HSA to pay for any of these, whether or not your insurance covers them.

Is therapy or counseling a may have access to HSA expense?

Yes. Mental health treatment, including therapy, counseling, and psychiatric care, is may have access to whether or not your insurance covers it. You can use HSA money to pay for copays, deductibles, or the full cost if you pay out of pocket.

Can I use my HSA for my pet's medical care?

No. Veterinary expenses are not may have access to, even if your pet is a service animal. The IRS considers pet care a personal expense, not a medical expense for the account holder.