List of HSA-Eligible Expenses: What Can You Use Your HSA For?

A list of HSA-eligible expenses helps employees understand which healthcare costs they can pay from a health savings account. These are costs of medical care, such as diagnosing or treating an illness, preventing disease, or treating a part or function of the body. They can apply to the account holder, their spouse, and eligible dependents, provided another source hasn’t already reimbursed the expense.

HSA distributions used for qualified medical expenses are generally free from federal income tax. Nonqualified withdrawals are taxable and may carry a 20% penalty before the age of 65, unless an exception applies. Employees should confirm eligibility before using HSA funds.

The following sections outline key HSA rules for employees. They use IRS Publication 502(opens in a new tab) and Publication 969(opens in a new tab) to help show how medical-care definitions work and how employees can confirm eligibility. HR teams can use this guidance to address common HSA questions. 

HSA-Eligible Expenses at a Glance

Common HSA-eligible items include medicines, vision supplies, and first aid supplies, alongside medical and dental services. This table groups representative expenses rather than attempting to cover every eligible purchase.

Recent law changes also affect certain expenses. The CARES Act expanded eligible expenses to include menstrual care products and removed the prescription requirement for OTC medicines. IRS guidance on that change(opens in a new tab) matters because Publication 502 focuses on itemized medical deductions, which follow different rules. An OTC medicine can qualify for HSA reimbursement even when it isn’t deductible as an itemized medical expense.

How Do These Expenses Compare With FSAs and HRAs?

Many of the same costs are also eligible expenses that qualify under a flexible spending account (FSA) or a health reimbursement arrangement (HRA). But each account follows its own rules, and an employer’s plan may limit what it reimburses. For example, a limited-purpose health FSA usually covers only dental and vision expenses.

Understanding these differences helps employees avoid assuming that one account works the same as another. HSA and FSA rules vary on timing, documentation, and reimbursement. And HRA compatibility adds another layer. Employees should check their specific plan details before coordinating payments across accounts.

What Expenses May Be HSA Eligible in Certain Circumstances?

Some expenses qualify only when they treat a diagnosed medical condition. The medical purpose matters more than the product category or how someone describes the purchase. The following examples can show when an expense meets HSA rules:

• Weight-loss programs: A program may qualify when it treats a specific disease diagnosed by a physician, such as obesity or diabetes. Losing weight for appearance or general well-being doesn’t meet that standard.

• Massage therapy: Treatment for a medical condition may qualify. A relaxation massage or spa visit for general comfort doesn’t become medical care simply because it reduces stress.

• Vitamins and supplements: These may qualify when a medical practitioner recommends them to treat a diagnosed medical condition. Routine supplements taken to maintain general health generally don’t qualify.

• Home modifications: Changes primarily made for medical care, such as an accessibility ramp or support bars, may qualify. An increase in the home’s value can reduce the eligible amount, and aesthetic additions don’t qualify.

• Nutrition counseling: Counseling may qualify when it treats a physician-diagnosed disease. General advice about eating well doesn’t meet the medical-care definition.

The IRS wellness expense FAQs(opens in a new tab) explain these distinctions. Documentation from a healthcare professional, sometimes called a letter of medical necessity (LMN), may help establish the medical purpose. But it doesn’t automatically turn a personal or general-wellness purchase into an eligible expense.

What Expenses Are Not HSA Eligible?

Purchases for ordinary personal care or general wellness generally don’t qualify for HSA reimbursement. Common examples of items that don’t qualify include:

• General fitness: Gym memberships and exercise classes purchased for overall health rather than a qualifying medical purpose

• Cosmetic services: Teeth whitening and procedures intended only to improve appearance

• Everyday personal care: Toothpaste, toiletries, and other ordinary grooming products

• General-wellness products: Vitamins, supplements, and products bought to feel healthier

• Most health insurance premiums: Regular premiums aren’t qualified HSA expenses

Some premium payments qualify under narrow exceptions. Those include COBRA continuation coverage, health coverage while receiving unemployment compensation, and qualified long-term care insurance premiums within applicable age-based limits. Once the account holder is 65 or older, certain Medicare and other health coverage premiums may also qualify, but Medigap premiums don’t. Review Publication 969’s premium rules(opens in a new tab) before making a payment.

These rules also apply to health-related devices. For example, a smartwatch isn’t automatically eligible simply because it tracks health data. Current IRS guidance considers whether a wearable was purchased and used primarily to help diagnose, prevent, or treat a specific disease rather than for general wellness or personal use.

How To Know Whether an Expense Qualifies for HSA Funds

Confirming HSA eligibility requires several specific checks. The following steps help determine whether the expense meets medical-care rules and qualifies for tax-free reimbursement:

1. Identify the expense: Find the service or item in current IRS guidance. If it isn’t listed, apply the medical-care definition rather than relying on a retailer’s category label.

2. Check special conditions: For a supplement or wellness-related service, establish the qualifying medical purpose and obtain supporting professional documentation when needed. An LMN supports the facts but doesn’t override the rules.

3. Confirm the person and date: The expense must be for the account holder, spouse, or an eligible dependent and generally must have been incurred after the HSA was established.

4. Check prior reimbursement: Don’t reimburse an amount already paid by insurance, an FSA, an HRA, or another source. The same expense also can’t support both a tax-free HSA distribution and an itemized medical deduction.

5. Keep records and resolve uncertainty: Retain itemized receipts, explanations of benefits, and relevant medical documentation. Use IRS guidance and qualified tax advice when the answer remains unclear.

These checks work together. For example, a dental filling qualifies as medical care, but an employee whose insurer paid part of the bill can use HSA funds only for the remaining unreimbursed portion. Eligibility and reimbursement amount are separate steps.

HSA coverage can be confusing because the account processes payments even when an item isn’t tax-qualified. A successful card transaction alone doesn’t establish eligibility. Employees still need records supporting how the funds were used.

Help Employees Understand and Use Their HSA Benefits

HR teams can make HSA guidance more useful by pairing the common-expense list with a few conditional examples. Explain why a prescribed treatment and a general-wellness purchase can receive different treatment, then show employees where to check an unfamiliar expense.

Employees may also ask how HSA payments fit into their broader benefits. Resources on pre-tax payroll deductions, how health FSAs work, and nontaxable fringe benefits can clarify those connections. They also help employees understand their benefits without mistaking a payroll deduction for approval of a purchase.

Justworks PEO helps small businesses access benefits and manage benefits administration. For a practical resource to share with employees, visit the Justworks HSA Help Center, which explains account eligibility, contributions, qualified expenses, and rollover basics.

This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, legal or tax advice. If you have any legal or tax questions regarding this content or related issues, then you should consult with your professional legal or tax advisor.

FAQ

Can Employees Use HSA Funds for Medical Expenses Incurred Before Opening the HSA?

No, the expense must be incurred after the HSA is established. The date of medical care matters, not simply when the employee pays the bill. Rollovers from an earlier HSA can preserve that earlier establishment date under IRS rules.

What HSA Documentation Should Employees Keep for Eligible Expenses?

Employees should keep itemized receipts or invoices showing the service or purchase, date, and amount. They should also retain records of insurance payments and HSA reimbursements. Documentation establishing a conditional expense’s medical purpose can also help confirm eligibility.

How Can HR Help Employees Understand Which Expenses Are HSA Eligible?

Use specific examples when employees ask, “What are HSA-eligible expenses?” Explain common categories, flag purchases needing additional review, and direct personal tax questions to a qualified advisor. Keep IRS links available alongside the benefits materials employees already use.

What Medical Expenses Are Eligible for HSA Reimbursement?

Medical, dental, and vision care qualify when the person, timing, and reimbursement rules are met. Check conditional purchases individually rather than treating this list as automatic approval.