How HSA Eligibility Is Determined
Qualified medical expenses under HSA rules must serve to diagnose, treat, mitigate, or prevent a physical or mental condition, rather than supporting general wellness. HSA funds are only available for eligible expenses after the account is established; other withdrawals face income tax plus a 20% penalty before age 65. The IRS provides guidance in Publication 502 (Medical and Dental Expenses) and Publication 969 (Health Savings Accounts). Keep receipts and Explanation of Benefits forms in case of an audit.
What You Can Legally Pay with Your HSA
Clinical services form the core of eligible spending: primary and specialist visits, hospital stays, emergency care, laboratory work, diagnostic imaging such as X-rays, MRIs, and ultrasounds, preventive screenings like mammograms and cholesterol panels, and telehealth consultations with licensed physicians. All FDA-approved prescription medications qualify, including drugs for chronic conditions such as hypertension, diabetes, asthma, and high cholesterol, as well as short-term treatments for acute illness.
The CARES Act expanded eligibility to include menstrual products and many over-the-counter items without a prescription, such as pain relievers, antacids, allergy and cold medications, first aid supplies, and acne treatments used for medical purposes. Mental health care is fully covered, including psychiatrists, psychologists, and licensed therapists, outpatient counseling, substance use treatment, and psychiatric medications. Dental care such as cleanings, fillings, braces, extractions, and dentures qualifies, along with vision expenses like eye exams, glasses, contacts, and LASIK. Cosmetic treatments such as teeth whitening do not.
Women's health services are broadly eligible, covering well-woman and gynecological exams, Pap smears, clinical breast exams, pelvic exams, hormone replacement therapy medications, infertility treatments including IVF, prenatal care, and menstrual products. Weight loss care qualifies only when physician-prescribed for a diagnosed condition such as obesity or metabolic syndrome, including supervised programs, GLP-1 medications like semaglutide and tirzepatide, physician-ordered nutritional counseling, and bariatric surgery. General gym memberships and self-directed diets do not qualify.
Chronic disease management is fully covered, including blood glucose and blood pressure monitors, insulin, asthma inhalers, nebulizers, CPAP machines, hearing aids, and in-home medical equipment. Transportation to medical care is also eligible: mileage to appointments, public transit costs, and overnight lodging for necessary medical travel when you cannot return home the same day.
What You Cannot Pay with Your HSA
Ineligible expenses include general gym memberships not prescribed for a specific condition, cosmetic surgery, teeth whitening, unprescribed vitamins and supplements, most health insurance premiums, toiletries, and non-prescription sunglasses. Using HSA funds for these purposes triggers taxes and penalties.
2026 Update: HSA Funds Can Now Cover Direct Primary Care Memberships
Beginning January 1, 2026, eligible patients may use HSA funds toward Direct Primary Care memberships. Sina Medical Direct Primary Care memberships start at $90 per month and cover unlimited primary care visits, chronic disease management, women's health services, weight loss programs, and 24/7 physician access with no copays or per-visit fees. Labs and medications are available at discounts of up to 90% off retail.
To preserve HSA contribution eligibility, DPC membership fees generally should not exceed $150 per month for individuals or $300 for families, though existing HSA balances may cover higher costs. Consult a tax professional to verify how the rules apply to your specific plan.
Frequently Asked Questions
HSA funds may cover eligible expenses for a spouse and tax-dependent children, even if they are not enrolled under your plan. Using funds for ineligible expenses before age 65 results in income tax plus a 20% penalty; after 65 the penalty ends, but non-medical withdrawals remain taxable as ordinary income, and mistakes should be corrected by reimbursing the account. Telehealth with a licensed physician qualifies, and Sina Medical Direct Primary Care offers telemedicine across Illinois for primary care, chronic disease management, women's health, and weight loss.
Physician-prescribed alternative therapies such as acupuncture, nutritional consulting, and physical therapy may qualify when treating a diagnosed condition, though general wellness services without a diagnosis usually do not. Licensed mental health services qualify without a formal referral, including psychotherapy, psychiatric evaluations, and medications, as long as treatment addresses a diagnosed condition rather than general wellness coaching.
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