Eligible Expenses

Eligible medical expenses are defined as those expenses paid for care as described in Section 213(d) of the Internal Revenue Code. Additionally, the IRS has allowed some over-the-counter drugs to qualify as eligible medical expenses.¹ For the detailed list of eligible medical expenses, please refer to the Technical Guidance section.

Health insurance may not be purchased with HSA funds. There are four situations that are exceptions whereby HSA funds can be used to pay for:

A health plan during any period of continuation coverage required under any federal law.
A qualified long-term insurance contract.
A health plan during a period in which the individual is receiving unemployment compensation under federal or state law.
For individuals over age 65, premiums for Medicare Part A or B, a Medicare HMO and/or the employee share of premiums for the employer-sponsored health insurance, including premiums for employer-sponsored retiree health insurance.

¹ Revenue Ruling 2003-102, 2003-38 I.R.B. 559