What an HSA covers: the basic rule

An HSA (Health Savings Account) covers medical, dental, and vision expenses that would otherwise come out of your pocket. The IRS maintains a list of what counts as a may have access to medical expense. The key is that the expense must be for diagnosis, treatment, or prevention of a disease or condition — not for general wellness or cosmetic reasons.

You can use HSA money to pay for the expense itself, or to reimburse yourself for an expense you already paid out of pocket. You do not have to use the money in the year you earn it; HSA funds roll over indefinitely, which makes them different from Flexible Spending Accounts (FSAs).

Key Takeaways

  • HSA funds cover doctor visits, prescription medications, dental work, vision care, and medical equipment — but only if you have a high-deductible health plan.
  • Over-the-counter medications like pain relievers and cold medicine are covered only if you have a prescription from a doctor.
  • Cosmetic procedures, gym memberships, and general wellness products are not covered, even if they improve your health.
  • You can use HSA money to pay now or reimburse yourself for past medical expenses, and unused money stays in your account year to year.
  • The IRS publishes a detailed list of covered expenses; when you are unsure, checking that list or asking your HSA provider is faster than guessing.

Medical expenses HSAs definitely cover

Doctor visits, hospital stays, and surgery are covered. This includes the cost of the visit itself, lab work, imaging (X-rays, MRIs, ultrasounds), and anesthesia. If your doctor orders a test or procedure, the HSA can pay for it.

Prescription medications are covered. Over-the-counter medications like ibuprofen, acetaminophen, antihistamines, and cough syrup are covered only if a doctor writes you a prescription for them — buying them off the shelf does not count. Insulin is an exception: you can buy insulin over the counter without a prescription and still use HSA funds.

Mental health care is covered: therapy, psychiatry visits, and inpatient treatment for mental illness all may have access to. Dental work is covered, including cleanings, fillings, root canals, and orthodontia. Vision care is covered: eye exams, glasses, contact lenses, and laser eye surgery all count.

Medical equipment and supplies that may have access to

Durable medical equipment — items prescribed by a doctor that you will use repeatedly — is covered. This includes wheelchairs, crutches, hearing aids, blood pressure monitors, glucose meters, and continuous positive airway pressure (CPAP) machines. The equipment must be prescribed or recommended by a doctor.

Supplies for managing a diagnosed condition are covered. Diabetics can use HSA funds for test strips, lancets, and glucose tablets. People with asthma can cover inhalers and peak flow meters. Bandages, braces, and compression stockings prescribed by a doctor are covered.

Dental supplies like replacement toothbrushes are not covered, but dental floss and mouthwash prescribed by a dentist for a specific condition may be. When the item is borderline, your HSA provider can tell you whether they will reimburse it before you spend the money.

What HSAs do not cover

Cosmetic procedures are not covered unless they treat an injury or disease. Botox for wrinkles does not count. Botox for chronic migraines, prescribed by a neurologist, does count. The difference is whether a doctor is treating a medical condition or improving appearance.

General wellness is not covered. Gym memberships, fitness classes, diet programs, and vitamins are not covered, even if they improve your health. Sunscreen is not covered. Toothpaste and regular toothbrushes are not covered. These are considered general health maintenance, not treatment of disease.

Childcare, babysitting, and nanny services are not covered, even if they allow you to work. Long-term care insurance premiums are not covered. Travel to a medical appointment is not covered (though the medical appointment itself is). Maternity clothes are not covered, but the hospital bill for delivery is.

Over-the-counter items: the prescription rule

The rule changed in 2020. Before that year, you could use HSA funds for most over-the-counter items without a prescription. Now, you need a prescription from a doctor for almost all of them.

The main exception is insulin. You can buy insulin over the counter and use HSA funds without a prescription. For everything else — pain relievers, allergy medicine, heartburn medication, cold medicine — you need a doctor to write a prescription first. Some people keep a standing prescription on file with their pharmacy for items they use regularly, which makes reimbursement simpler.

How to know if something is covered

The IRS publishes Publication 502, which lists hundreds of covered and non-covered expenses. It is searchable and specific: you can look up "acupuncture" or "weight loss program" and get a yes or no answer. Your HSA provider also maintains a list and can answer questions about specific items before you buy them.

When you are unsure, ask your HSA provider in writing or through their website portal. Keep their answer in case you are audited. If you pay for something and later find out it was not covered, you can withdraw that money from the HSA, but you will owe income tax on it plus a 20 percent penalty.

Frequently Asked Questions

Can I use my HSA to pay my health insurance premium?

No, not your regular monthly premium. You can use HSA funds to pay premiums for COBRA coverage (if you lose your job), long-term care insurance, or health insurance while you are unemployed. You cannot use it for your current employer's health plan premium.

Are prescription glasses and contacts covered?

Yes. Eye exams, glasses, contact lenses, and contact lens solution are all covered. Laser eye surgery (LASIK or PRK) is also covered. The eye care must be for vision correction or treatment of an eye condition, not cosmetic.

What if I use my HSA card for something that turns out not to be covered?

You will owe income tax on that amount plus a 20 percent penalty. If you realize the mistake quickly, contact your HSA provider and ask about reversing the transaction. Keep receipts so you can prove what you spent the money on if the IRS asks.

Can I use HSA money for my spouse's medical expenses?

Yes, if your spouse is on your tax return as a dependent. You can also use it for any dependent child, parent, or other relative you claim on your taxes. The person does not have to be on your health plan.

Does my HSA cover preventive care like vaccines and screenings?

Yes. Preventive care — annual physicals, cancer screenings, vaccinations, blood pressure checks — is covered. These are considered medical expenses because they prevent or detect disease, even though you are not currently sick.