What You Can and Can’t Purchase With an HSA: Rules and Limits

You can use an HSA to buy almost anything the IRS treats as a qualified medical expense: doctor and hospital care, prescription and over-the-counter medications, dental and vision work, medical supplies, menstrual products, certain insurance premiums, medically necessary home modifications, and travel to get treatment. The governing definition is broad: costs for the diagnosis, cure, mitigation, treatment, or prevention of disease, and anything that affects a structure or function of the body.¹ What falls outside that definition, mainly cosmetic procedures and general wellness spending, is where the 20% penalty starts.

Doctors, Hospitals, and Diagnostics

Payments to physicians, surgeons, and other licensed medical professionals for diagnosis or treatment are the core of qualified spending. That covers specialist visits, mental health care from licensed psychologists or psychiatrists, and therapies such as physical therapy and acupuncture from certified practitioners.²

Hospital stays, medically necessary nursing services, and lab work such as blood tests and imaging all qualify. If your doctor orders an MRI or X-ray, you can pay for it directly from the HSA.

Over-the-Counter Medications and Supplies

Since 2020, HSA funds cover over-the-counter medications without a prescription. Pain relievers, allergy medications, cold remedies, and decongestants can go on the HSA card at the register.³

Everyday medical supplies qualify too:

First-aid supplies such as bandages, gauze, and first-aid kits
Thermometers, blood pressure monitors, and pulse oximeters
Diabetic supplies including glucose meters, testing strips, and lancets
Contact lens solution and other vision care supplies

Menstrual care products (tampons, pads, liners, cups, and similar items) were made permanently eligible under the CARES Act. No prescription or documentation is needed.³

Vitamins, nutritional supplements, and herbal remedies are a different story. They only qualify if a physician has diagnosed a specific condition and recommends the supplement as treatment. Weight-loss programs follow the same rule: your doctor must diagnose a condition such as obesity or heart disease. A Letter of Medical Necessity on file protects you if the IRS questions the purchase.²

Dental and Vision Care

Dental work qualifies as long as it serves a medical rather than purely cosmetic purpose. Routine cleanings, fillings, crowns, root canals, extractions, dentures, and dental implants are all eligible. Orthodontic treatment, including traditional braces, also qualifies.²

On the vision side, eye exams, prescription glasses, contact lenses, and corrective surgery such as LASIK are qualified expenses. Teeth whitening is considered cosmetic and does not qualify.

Reproductive and Preventive Health

HSA funds cover a broad range of reproductive health expenses: prescription birth control, over-the-counter pregnancy tests, breast pumps, and lactation supplies.⁴ Fertility treatments, including in-vitro fertilization, qualify when they address a diagnosed condition.

Preventive items your HSA can cover include sunscreen of SPF 15 or higher, and smoking cessation programs, nicotine patches, gum, and prescribed medications. These fit the IRS’s inclusion of expenses aimed at preventing disease, not just treating it.¹

Medical Travel and Lodging

Transportation costs for medical care qualify. For 2026, the IRS standard mileage rate for medical travel is 21 cents per mile.⁵ Bus, taxi, train, and ambulance fares also qualify when the trip is primarily for medical care.

Lodging away from home during treatment is capped at $50 per night per person. A companion’s lodging can qualify at the same $50 rate if the patient cannot travel alone, for example a parent accompanying a child to an out-of-town specialist. Meals during medical travel do not qualify.²

Home Modifications for Medical Needs

Some home improvements count as qualified medical expenses when their primary purpose is medical care. Because most accessibility modifications don’t increase the home’s value, you can include the full cost. Common examples:

Entrance and exit ramps
Widened doorways and hallways
Bathroom grab bars, railings, and support bars
Lowered kitchen cabinets and counters
Porch lifts and stairway modifications
Modified electrical outlets and warning systems

If a modification does increase your home’s value, an elevator being a common example, you can only count the portion of the cost that exceeds the increase in property value. Aesthetic upgrades beyond the medical need are not qualified.²

Who Your HSA Can Pay For

Your HSA isn’t limited to your own care. You can pay qualified expenses for:

Your spouse
Anyone you claim as a dependent on your tax return
Anyone who would qualify as your dependent except that they filed a joint return, had too much income, or you could be claimed on someone else’s return

For divorced or separated parents, a child is treated as the dependent of both parents for HSA purposes, regardless of which parent claims the child on the return.⁶

Insurance Premiums Your HSA Can Cover

Most health insurance premiums cannot be paid from an HSA, but there are specific exceptions at any age: long-term care insurance (subject to age-based limits), COBRA continuation coverage, and health coverage while receiving unemployment benefits.⁶

Once you turn 65, you can also use HSA funds tax-free for Medicare Part B, Medicare Part D, and Medicare Advantage premiums. Medigap (Medicare supplement) premiums do not qualify.⁶

What Doesn’t Qualify

Common items that cannot be paid with HSA funds:

Cosmetic procedures such as face lifts, hair transplants, liposuction, and teeth whitening, unless the procedure corrects a deformity from a congenital abnormality, accident, or disfiguring disease
Gym memberships and health club dues, even when a doctor recommends exercise
General wellness vitamins and supplements, unless prescribed for a diagnosed condition
Marijuana and other federally controlled substances, regardless of state law
General health activities such as dancing or swimming lessons recommended solely for well-being

The dividing line is specific medical purpose. Spending aimed at general health or appearance doesn’t qualify.²

What Happens If You Buy Something That Doesn’t Qualify

A non-qualified distribution gets added to your taxable income for the year, plus a 20% additional tax on the non-qualified amount.⁴ For someone in the 22% federal bracket, that’s roughly 42 cents lost on every dollar of ineligible spending.

Three situations waive the 20% penalty: reaching age 65, becoming disabled, or death of the account holder. Income tax on the non-medical amount still applies.⁶ After 65, non-medical withdrawals work like a traditional IRA distribution: taxed as ordinary income, no penalty.

Keep Receipts, and Know You Can Wait to Reimburse

The IRS can ask you to prove that any HSA withdrawal went to a qualified expense. For each transaction, keep documentation showing the provider or merchant, the date, a description of the item or service, and the amount paid. Explanation of Benefits statements from your insurer can back up the record.

There is no deadline for reimbursing yourself. You can pay a medical bill out of pocket today, let the HSA grow tax-free for years, and reimburse yourself later, as long as the expense occurred after you opened the account and you kept the receipt.⁶

1
Office of the Law Revision Counsel. 26 USC 213 – Medical, Dental, Etc., Expenses
2
Internal Revenue Service. Publication 502, Medical and Dental Expenses
3
Internal Revenue Service. IRS Outlines Changes to Health Care Spending Available Under CARES Act
4
Office of the Law Revision Counsel. 26 USC 223 – Health Savings Accounts
5
Internal Revenue Service. IRS Notice: 2026 Standard Mileage Rates
6
Internal Revenue Service. Publication 969, Health Savings Accounts and Other Tax-Favored Health Plans