What a health savings account actually covers
A health savings account (HSA) covers medical, dental, and vision expenses that your health insurance does not pay for — but only specific ones. The IRS publishes a list of what counts as a may have access to medical expense, and if an expense is not on that list, you cannot use HSA money for it without paying taxes and a penalty.
The broadest rule is this: an HSA covers costs related to diagnosing, treating, or managing a medical condition. That includes doctor visits, prescription drugs, surgery, mental health care, and physical therapy. It also covers things you buy at a pharmacy or medical supply store — bandages, crutches, blood pressure monitors, hearing aids — as long as they treat or manage a health problem.
What trips people up is that "medical" does not mean "health-related." Vitamins, gym memberships, and weight loss programs are health-related, but the IRS does not count them as medical expenses. The distinction matters because using HSA money on non-may have access to expenses costs you money in taxes.
Key Takeaways
- An HSA covers doctor visits, prescription drugs, surgery, mental health care, dental work, and vision care — but only the portions your insurance does not pay.
- Medical supplies and equipment like crutches, wheelchairs, hearing aids, and blood glucose monitors count as may have access to expenses if they treat or manage a diagnosed condition.
- Vitamins, supplements, gym memberships, and cosmetic procedures do not count, even though they relate to health.
- If you use HSA money on a non-may have access to expense, you owe income tax on that amount plus a 20 percent penalty.
- The IRS publishes a full list of may have access to expenses, and you can ask your HSA provider whether a specific item counts before you spend the money.
Medical care and treatment your HSA covers
Doctor visits, hospital stays, surgery, and emergency care all count. This includes the copay or coinsurance you owe after insurance pays its share. If your insurance covers 80 percent of a surgery and you owe 20 percent, you can use your HSA for your 20 percent.
Prescription medications are covered. Over-the-counter drugs are covered only if you have a prescription for them — so ibuprofen you buy without a prescription does not count, but ibuprofen your doctor prescribes does. Mental health care, including therapy and psychiatric medications, counts as a may have access to expense.
Preventive care that your insurance covers at no cost to you — like annual checkups and cancer screenings — does not need HSA money because you do not owe anything. But if you see a specialist or need additional testing beyond what insurance covers, your HSA covers your share of that cost.
Dental and vision expenses covered by an HSA
Dental work counts fully: cleanings, fillings, root canals, extractions, crowns, and orthodontia like braces. You can use your HSA even if you do not have dental insurance through your employer. The same applies to vision care — eye exams, glasses, contact lenses, and surgery like LASIK all count.
Cosmetic dental or vision work does not count unless it is medically necessary. Teeth whitening is cosmetic and does not count. But if you need a crown because a tooth is broken or decayed, that counts even if the crown also improves the appearance of your smile.
Medical equipment and supplies you can buy with HSA funds
Items you buy at a pharmacy or medical supply store count if they treat or manage a diagnosed medical condition. This includes blood glucose monitors and test strips for diabetes, inhalers for asthma, bandages and wound care supplies, crutches, wheelchairs, hearing aids, and continuous positive airway pressure (CPAP) machines for sleep apnea.
Eyeglasses and contact lenses count. Orthopedic shoes count if they are prescribed to treat a foot condition — but regular shoes do not, even if they are comfortable. A mattress does not count, but a mattress designed specifically for people with pressure ulcers does.
The rule is whether the item is primarily medical. If it has a non-medical use, the IRS usually does not count it. A humidifier for general comfort does not count, but a humidifier prescribed by a doctor to treat a respiratory condition does.
What does not count, even though it seems medical
Vitamins and supplements do not count unless a doctor prescribes them to treat a specific diagnosed condition. A multivitamin you take for general health does not count. But if your doctor prescribes a specific supplement to treat a deficiency or condition, ask your HSA provider whether it qualifies — some do, depending on how the prescription is written.
Gym memberships, fitness classes, and weight loss programs do not count, even if your doctor recommends exercise. Cosmetic procedures do not count — this includes teeth whitening, hair removal, and plastic surgery done for appearance rather than medical need.
Over-the-counter drugs without a prescription do not count. This includes pain relievers, cold medicine, allergy medicine, and antacids you buy without asking a doctor. If you want to use your HSA for these, you need a prescription first.
Long-term care insurance and long-term care services do not count. Health insurance premiums do not count either, with one exception: if you are receiving unemployment benefits, you can use your HSA to pay for health insurance premiums while you are unemployed.
How to know if something counts before you spend the money
The IRS publishes a full list of may have access to medical expenses in Publication 502, which you can find on the IRS website. Your HSA provider also maintains a list and can answer questions about specific items.
Before you buy something you are unsure about, contact your HSA provider and describe the item and why your doctor recommended it. They can tell you whether it qualifies. Keep that answer in writing — if the IRS ever questions the expense, you will have documentation that you asked first.
Keep receipts for everything you buy with your HSA, along with any prescription or doctor's note that supports the purchase. The IRS does not require you to submit receipts when you withdraw money, but you must be able to prove the expense was may have access to if you are audited.
What happens if you use HSA money on a non-may have access to expense
If you withdraw money from your HSA and spend it on something that does not count, you owe income tax on that amount. You also owe a 20 percent penalty on top of the tax. So if you withdraw $100 for a non-may have access to expense and you are in the 22 percent tax bracket, you owe $22 in tax plus $20 in penalty — a total of $42 on a $100 withdrawal.
After age 65, the penalty goes away. You still owe income tax on non-may have access to withdrawals, but not the 20 percent penalty. This is one reason some people use their HSA as a retirement savings account — after 65, it works like a traditional IRA.
Frequently Asked Questions
Can I use my HSA to pay for my health insurance premium?
No, with one exception. You cannot use HSA money to pay premiums for your regular health insurance. But if you are receiving unemployment benefits, you can use your HSA to pay for health insurance premiums during the time you are unemployed. You also can use HSA money to pay for Medicare premiums and long-term care insurance premiums after age 65.
Does my HSA cover my copay or deductible?
Yes. Your copay is the fixed amount you owe at a doctor visit — your HSA covers that. Your deductible is the amount you must pay out of pocket before insurance starts paying — your HSA covers that too. Any cost-sharing amount your insurance plan requires, your HSA can pay for.
Can I use my HSA for my spouse's or child's medical expenses?
Yes, as long as they are your tax dependents or your spouse. You do not have to be covered by the same health insurance plan. You can use your HSA to pay for their doctor visits, prescriptions, dental work, and other may have access to expenses.
What if my doctor prescribes something but my insurance does not cover it?
If your insurance denies coverage, your HSA can still cover the expense if it is a may have access to medical expense. The fact that your insurance does not pay does not change whether the IRS counts it. You owe the full cost, but you can use HSA money to pay it.
Are over-the-counter pain relievers covered if I have a prescription?
Yes. If your doctor writes a prescription for ibuprofen, acetaminophen, or another over-the-counter drug, you can use your HSA to buy it. The prescription is what makes it count — without the prescription, it does not.