HSA Eligible Expenses

Since they were enacted in 2003, Health Savings Accounts (HSAs) have become an integral part of the consumer directed healthcare landscape for those with a high deductible health plan. As of December 2019, there were nearly 29 million HSA accounts, meaning that a lot of people rely on their pretax set-aside funds to help reduce their healthcare costs and amount of taxable income. One of the chief benefits of having an HSA is that account holders can use that money to pay for a wide range of eligible medical expenses for themselves, their spouses, and their tax dependents.

According to IRS Publication 502:

Medical expenses are the costs of diagnosis, cure, mitigation, treatment, or prevention of disease, and the costs for treatments affecting any part or function of the body. These expenses include payments for legal medical services rendered by physicians, surgeons, dentists, and other medical practitioners. They include the costs of equipment, supplies, and diagnostic devices needed for these purposes.

Medical care expenses must be primarily to alleviate or prevent a physical or mental defect or illness. They don’t include expenses that are merely beneficial to general health, such as vitamins or a vacation.

The following lists identify common expenses that are HSA eligible and non-eligible. In March 2020, the CARES Act approved over-the-counter medications and menstrual care expenses for purchase with an HSA.

HSA Eligible Expenses

  • Acupuncture
  • Alcoholism and Drug Addiction treatment
  • Ambulance services
  • Artificial teeth
  • Bandages
  • Birth control and contraceptive devices
  • Body scan (electronic)
  • Braille reading material
  • Breast feeding supplies/lactation expenses
  • Capital expenses (home improvements that accommodate a disabled person)
  • Chiropractor
  • COBRA coverage
  • Communication equipment for the deaf or speech impaired
  • Contact lenses and eyeglasses
  • Crutches (purchased or rented)
  • Dental treatments (most)
  • Diagnostic devices (blood sugar monitors, blood pressure monitors, etc)
  • Disabled dependent expenses for medical care
  • Eye exams
  • Eye surgery
  • Fertility treatments
  • Guide dog or other service animals
  • Hearing aid expenses (batteries, repairs, and maintenance)
  • Home for the Intellectually and Developmentally Disabled
  • Hospital services (including meals and lodging)
  • Insurance Premiums (if receiving unemployment benefits)
  • Insulin and diabetic supplies
  • Lead-based paint removal
  • Long-term care and services for chronically ill individual
  • Medical Conference expenses (if related to personal chronic illness)
  • Medicare B and D premiums
  • Menstrual care products
  • Nursing home and services
  • Organ transplants
  • Oxygen and oxygen equipment
  • Over-the-counter medications
  • Physical examination, Annual
  • Pregnancy test kits
  • Prescription drugs and medicine
  • Prosthesis (including artificial limbs and breast reconstruction surgery)
  • Psychiatric care
  • Psychoanalysis
  • Psychologist
  • Smoking cessation medicines and treatment plans
  • Special education
  • Therapy
  • Transportation expenses for medical treatments and services
  • Vaccinations
  • Vehicular expenses (for operational and design costs that accommodate a disabled person)
  • Weight loss program (requires physician’s diagnosis)
  • Wigs (for hair loss due to disease or medical treatment)
  • Wheelchairs
  • X-ray

Not Eligible

  • Controlled substances (Illegal under federal law, such as marijuana, laetrile, etc)
  • Cosmetic surgery not related to a deformity or illness (i.e., facelift, liposuction, etc)
  • Dancing lessons
  • Diaper services (unless related to effects of disease)
  • Electrolysis
  • Funeral expenses
  • Future medical care
  • Hair transplant or removal
  • Health club dues
  • Household help
  • Illegal operations and treatments
  • Maternity clothes
  • Medicines and Pharmaceuticals from another country
  • Nutritional supplements
  • Swimming lessons
  • Teeth whitening
  • Veterinary fees (unless for service animal)

For full HSA eligible expenses and guidelines, refer to IRS Publication 502 or contact your HSA administrator.

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