What You Can Buy With Your HSA Card

If you're asking, "What can I buy with my HSA card?" you're likely seeking to maximize the value of your Health Savings Account (HSA). An HSA is a versatile tool that allows individuals with high-deductible health plans to save pre-tax dollars for qualifying medical expenses. Understanding what purchases are eligible under your HSA can help you make the most of this financial resource. Let's explore the types of purchases you can make with your HSA, including common expenses, less obvious options, and rules for using your HSA card.

Common Eligible Expenses

To start, it's important to understand which medical expenses are generally covered by an HSA. Here’s a list of typical items and services:

Medical Services

• Doctor Visits: Fees for general practitioners, specialists, and outpatient care are eligible.
• Hospital Services: Includes the cost of hospital stays and related services such as surgery.
• Mental Health Services: This includes psychologist or psychiatrist visits and therapy sessions.

Prescription Medications

• Rx Medications: Any prescribed medications required for treating a medical condition are covered.
• Insulin: Even if it is not prescribed, insulin is a qualifying expense.

Vision and Dental Care

• Eye Care: Expenses for eye exams, prescription glasses, and contact lenses qualify.
• Dental Care: Includes check-ups, cleanings, fillings, and orthodontic work.

Medical Equipment

• Mobility Aids: Items like crutches, wheelchairs, and walkers are covered.
• Monitoring Devices: Blood pressure cuffs or blood sugar meters fall under eligible purchases.

Less Obvious and Overlooked Purchases

The IRS has a comprehensive list of eligible expenses, and some common but less obvious ones include:

Over-the-Counter (OTC) Medications

Following the CARES Act, HSAs can cover over-the-counter drugs and medicines without a prescription, such as:

• Pain relievers (e.g., ibuprofen, acetaminophen)
• Cold and flu medicines
• Allergy medications

Feminine Care Products

• Menstrual Care Products: Tampons, pads, liners, and other menstrual products have been approved for purchase through an HSA.

Health and Fitness

• Prescription Orthopedic Shoes: If prescribed by a healthcare provider, these are eligible.
• Health Monitors: Items like blood pressure monitors and glucose meters are covered.

Alternative Treatments

If prescribed by a healthcare professional:

• Chiropractic Care: Visits to a licensed chiropractor qualify.
• Acupuncture: Treatments from a licensed acupuncturist are eligible.

Understanding HSA Rules

To use your HSA effectively, it's crucial to understand the following rules:

Contribution Limits

• Annual Limits: As of 2023, individuals can contribute up to $3,850 while families can contribute up to $7,750 to their HSA.
• Catch-Up Contributions: Those 55 and older can contribute an additional $1,000 annually.

Qualified Medical Expenses

• IRS Guidelines: The IRS provides Publication 502, detailing qualified medical and dental expenses. It's advisable to consult this resource for a detailed list of eligible expenses.

Tax Advantages

• Triple Tax Benefit: Contributions are pre-tax, growth is tax-deferred, and withdrawals for eligible expenses are tax-free.

Penalties for Non-Qualified Purchases

• Withdrawal Penalties: If you withdraw funds for non-eligible expenses before age 65, you will incur a 20% penalty plus income tax liability.
• Post-65 Rule: After 65, withdrawals for non-medical expenses are taxed as income but without penalties.

Tips for Maximizing HSA Benefits

Keep Detailed Records

• Receipts and Documentation: Maintain all receipts and documentation of expenses in case of an IRS audit.
• Itemized Statements: Organize digital or paper statements to track eligible expenses.

Invest Wisely

• Long-Term Growth: Explore investment opportunities with your HSA funds. Many HSA administrators offer mutual funds, stocks, and other investment options to grow your savings.

Use Tools and Apps

• Expense Trackers: Many apps help categorize and manage your medical expenses efficiently.
• HSA Provider Portals: Utilize online portals from your HSA provider for management and tracking.

FAQs: Addressing Common Questions and Misconceptions

Can I Pay for Family Members’ Medical Expenses?

Yes, you can use your HSA to pay for your spouse's and dependents’ qualified medical expenses, even if they are not covered under your high-deductible health plan.

Are Fitness and Wellness Activities Eligible?

Generally, gym memberships and wellness activities are not covered, unless prescribed to treat a specific medical condition.

Can I Use My HSA While Traveling Abroad?

You can use your HSA for eligible medical expenses incurred abroad, provided they comply with IRS guidelines. It's advisable to keep detailed records and receipts in English for documentation purposes.

What Happens To My HSA if I Change Jobs?

You own your HSA, so it goes with you when you change jobs or even if you become unemployed. The funds stay in your account and can be used for future medical expenses.

Using Your HSA Card Wisely

Your HSA card functions much like a debit card for eligible expenses. When using your card:

• Verify Eligibility: Always ensure the expense is eligible under IRS rules.
• Check Balances Regularly: Keep track of your account balance to avoid overdrafts, which can lead to fees.
• Stay Informed: Regularly consult your HSA administrator's website and IRS publications for updates on eligible expenses.

To make the most out of your HSA, it is wise to familiarize yourself with eligible expenses and strategically use your funds for qualified medical costs while planning for future healthcare needs. You can also explore related topics on our website to ensure you're maximizing your HSA's potential.