How can I use my health savings account (HSA) funds?

If you are currently enrolled in an eligible high-deductible health insurance plan, contributing money to a health savings account (HSA) is a great way to save on medical costs. Any money in these funds can be used for medical expenses that your health insurance does not cover and can be applied to costs that you, your partner or your dependents incur.

Another bonus: These accounts are funded directly from your paycheck with pre-tax dollars. Employers and family members can also make contributions to your HSA.

So how exactly can you use your HSA funds? From co-pays to preventive care to alternative treatments, there may be much more covered than you realize. Here are some of the ways you can plan to use your saved money.

To remember, though: This is not an exhaustive list and rules around HSA eligibility change frequently. Before tapping your HSA to pay for medical expenses, it’s always a good idea to check with your insurance provider or the administrator of your savings account.

Medical costs: You can use your HSA funds on charges like co-pays, deductibles, co-insurance and lab fees. You can also pay for ambulance rides, diagnostic scans, hospital services and surgical procedures that are not cosmetic. In addition, HSAs can also be used to pay for preventive care costs including medical exams, check-ups, well visits, vaccinations and screenings.

Medications: Prescription medications have always been covered by HSA money, along with some over-the-counter (OTC) meds that had a doctor’s prescription. The Coronavirus Aid, Relief, and Economic Security (CARES) Act in March 2020 expanded that coverage to include OTC medications. Most vitamins and supplements cannot be purchased using HSA dollars, however, although there are some exceptions, such as prenatal vitamins.

Dental: You can use your HSA to help with dental expenses. This includes preventive care—exams and cleanings—as well as certain treatments like fillings, X-rays, braces and dental surgeries. Don’t try to buy your toothpaste, floss, mouthwash and other oral care products with your HSA card, however. These items are not covered. The same goes for any teeth-whitening procedures.

Vision: Eye exams, glasses, contacts, prescription sunglasses and surgeries can all be paid for with your HSA account. Even procedures like LASIK vision correction are often covered.

Maternal and women’s health: Your HSA money covers a wide variety of procedures and items for women, including:

• Breast pumps and other lactation supplies
• Birth control
• Menstrual care products
• Pregnancy tests
• Fertility treatments, including in-vitro fertilization
• Midwife and doula services
• Costs associated with childbirth

Hearing assistance: Hearing aids as well as telephone and television equipment for the hearing impaired can be purchased with money from your HSA. You can also get reimbursed for the cost difference between braille books or magazines and a normally priced item.

Medical equipment: This may include testing equipment, thermometers, crutches, wheelchairs and medical alert bracelets.

Mental health: You can use your HSA to help pay for psychiatric care, including visits to a psychologist, therapy sessions and prescription medication.

Alternative therapies: Some of the covered therapies include acupuncture and chiropractic services. Massage may be covered under your HSA benefits but only if it’s medically necessary.

Cessation programs: These can include drug and alcohol addiction programs, as well as smoking cessation therapies.

Expenses to assist with disabilities or special needs: Some eligible expenses include the cost of guide dogs, special education for disabled dependents and any modifications you might need to make to your home or car to accommodate family members with disabilities.

Additional expenses: If deemed medically necessary, other purchases that you may be able to cover through your HSA include sunscreen, lodging while you or family members seek medical care, various nursing home expenses, in-patient care meals, transportation to medical services, wigs, lead-based paint removal and weight loss programs that are medically necessary.

What can’t you purchase using HSA funds?

Some expenditures, even though related to health, may not necessarily be considered qualified medical expenses. Options that are not covered under your HSA can include but are not limited to:

• Cosmetic surgeries
• Gym and exercise services
• Protein powder
• Baby formula
• Diapers
• Baby-sitting for healthy babies
• Many personal care items

What to know before you spend your HSA money

Keep these tips in mind as you plan out your medical expenditures:

Some expenses may require a letter of medical necessity (LMN). This is proof from a doctor that the expense you are seeking reimbursement for is medically necessary. For example, certain HSA funds will cover massage therapy if it is deemed essential by your doctor.

Every HSA is different. Some insurance providers will need an LMN for certain expenses, while others may not. But covered expenses should generally be consistent, since those expenses are determined by the IRS. Also keep in mind that HSAs offer different options and benefits than other, often similarly-named accounts, such as medical savings accounts, flexible spending accounts (FSAs) and health reimbursement arrangements (HRAs). Talk to your employer’s benefits department or your health insurance provider to learn about your options, and be certain you understand the parameters of the type of account you are enrolled in.

Rules frequently change. It’s important to keep tabs on the guidelines. Eligible expenses are sometimes added, while others could be removed in future years. Always check in with your insurance provider or the company that manages your HSA before planning your medical spending.