A health savings account (HSA) covers any expense that counts as medical care under the IRS definition: costs for diagnosing, treating, preventing, or managing a disease or condition, including equipment and supplies needed for those purposes. The list is broader than most people realize, spanning everything from therapy sessions and dental implants to over-the-counter pain relievers and menstrual products.
The key rule is that the expense must address a specific medical need. Items that are “merely beneficial to general health,” like general-purpose vitamins or a vacation, don’t qualify.
Doctor Visits, Prescriptions, and Hospital Care
The most straightforward eligible expenses are the ones you’d expect: office visits with any licensed medical provider, prescription medications, lab work, imaging, surgery, and hospital stays. This includes specialists like dermatologists, allergists, cardiologists, and physical therapists. Chiropractic care, acupuncture, and ambulance services also qualify.
Prescription drugs are fully eligible regardless of what they treat. Insulin qualifies even without a prescription.
Over-the-Counter Medications and Supplies
Since the CARES Act took effect in 2020, you no longer need a prescription to use HSA funds on over-the-counter medications. Pain relievers like acetaminophen and ibuprofen, allergy medications, acid reflux treatments, cold and flu remedies, anti-fungal creams, acne treatments, and cough syrups all qualify. Children’s versions of these products are eligible too.
Menstrual products, including tampons and pads, were also added as eligible expenses under the same law. First-aid supplies like bandages, thermometers, and blood pressure monitors qualify as well.
Dental Expenses
HSA funds cover a wide range of dental care: cleanings, X-rays, fillings, extractions, crowns, dentures, dental implants, and root canals. Braces and other orthodontic work are eligible, and you can pay for orthodontia either as a lump sum or as you’re billed each month. If your dentist recommends a material upgrade beyond what insurance covers, the difference in cost is also reimbursable.
Teeth whitening and other purely cosmetic dental procedures are not eligible.
Vision and Eye Care
Eye exams, prescription eyeglasses, prescription sunglasses, and contact lenses are all eligible. So are contact lens solution and supplies. LASIK and other corrective eye surgeries qualify as legitimate medical expenses. Reading glasses are eligible even without a prescription.
Mental Health and Behavioral Health
Therapy and counseling sessions with a psychologist, psychiatrist, or licensed therapist are HSA-eligible. Psychoanalysis qualifies. So does inpatient treatment for alcohol or drug addiction at a therapeutic center. If a doctor recommends special education or tutoring for a child with learning disabilities caused by a mental or psychological condition, those costs can qualify too.
Items That Need a Letter of Medical Necessity
Some expenses sit in a gray area. They could be medical or they could be general wellness, depending on your situation. For these, you’ll need a letter of medical necessity from a licensed practitioner. The letter must name the patient’s specific medical condition, confirm the item or service treats that condition (not general health or cosmetic purposes), and state the expected duration of treatment. For chronic conditions, the practitioner can write “lifetime” as the duration.
Common examples include air purifiers (eligible if prescribed for asthma or allergies), ergonomic equipment (eligible if prescribed for a diagnosed back condition), and weight-loss programs (eligible if prescribed for a specific disease like obesity or diabetes, but not for general fitness).
What’s Not Eligible
The IRS draws a firm line at general health and cosmetic expenses. Gym memberships, nutritional supplements taken for general wellness, cosmetic surgery, teeth whitening, and non-prescription sunglasses don’t qualify. Health club dues are ineligible even if your doctor recommends exercise.
Insurance premiums are generally not eligible either. You typically cannot use HSA funds to pay your monthly health insurance premiums. There are narrow exceptions, including COBRA continuation coverage and premiums for health coverage while receiving unemployment benefits, but for most people with active employer-sponsored insurance, premiums are off the table.
Covering Your Spouse and Dependents
You can use your HSA to pay qualified medical expenses for your spouse and your tax dependents, even if they aren’t covered by your high-deductible health plan. The expenses still need to meet the same IRS eligibility rules. This means one person’s HSA can cover a family’s doctor visits, prescriptions, dental work, and other qualified costs.
What Happens If You Spend on Ineligible Items
If you withdraw HSA money for something that doesn’t qualify as a medical expense, you’ll owe income tax on that amount plus an additional 20% tax penalty. That penalty disappears once you turn 65, become disabled, or pass away. After 65, non-medical withdrawals are still taxed as ordinary income, but the extra 20% goes away, making the HSA function similarly to a traditional retirement account for non-medical spending.
2025 Contribution Limits
For the 2025 tax year, you can contribute up to $4,300 if you have self-only coverage under a high-deductible health plan, or up to $8,550 for family coverage. If you’re 55 or older, you can add an extra $1,000 as a catch-up contribution. Unused funds roll over year to year with no expiration, so there’s no “use it or lose it” pressure like with a flexible spending account.
Keeping Records
The IRS doesn’t require you to submit receipts when you make a withdrawal, but you should keep them. If you’re audited, you’ll need to prove each distribution went toward a qualified medical expense. Save itemized receipts, explanation-of-benefits statements from your insurer, and any letters of medical necessity. There’s no time limit on when the IRS can ask for documentation on a tax-free HSA distribution, so hold onto records indefinitely or at least until you’ve filed and cleared the relevant tax year.