What can you buy with HSA (and FSA) funds?

Most of us don’t want to shell out hard-earned cash to pay for things that keep us healthy enough to earn that cash. So if you’re a fan of saving money—and who isn’t?!—you probably jump at any opportunity to save on medical expenses.

A Health Savings Account (HSA) or Flexible Spending Account (FSA) helps us do just that.

HSAs and FSAs allow us to reserve pre-tax funds to pay for qualified medical expenses. That means we can save up to 40% on doctor copays, prescriptions and other health services.

If we’re savvy, we can also save on lesser-known qualified expenses.

Read on for the nitty gritty on how to use an HSA or FSA for optimum financial health. Plus, how qualifying patients may be able to get the Letter of Medical Necessity needed for fitness, rehabilitation therapy and other items and services to qualify—online!

What is an HSA—and how do I get one?

HSA accounts are a type of tax-advantaged savings account that can be used to pay for qualified medical expenses. They’re available to those with a High Deductible Health Plan (HDHP).

High deductible plans have low monthly premiums but high deductibles—the amount you pay out of pocket before your insurer will cover all medical care costs. For 2025, the IRS defines an HDHP as having an annual deductible of at least $1,650 for a single person or $3,300 for a family. Out-of-pocket expenses can’t exceed $8,300 for a single person or $16,600 for a family.

If you have Medicare coverage, you can’t contribute to an HSA. (If you opened one before going on Medicare, you’ll have to use those funds or let them sit.) You also can’t have an HSA if you have a health plan that covers services without a copay or deductible.

You can get an HSA through your insurer, banks, credit unions, and other financial institutions.

FSAs are similar to HSAs in that you can reserve pre-taxed funds for medical expenses. But they’re only available to those who get their insurance through their workplace. Employers can open FSAs and offer them to employees as a benefit program. For 2025, employees can contribute up to $3,300 to their FSA. Some employers match a portion of the contributions as a health incentive.

How do FSA and HSA contributions save me money?

These accounts are sometimes referred to as having a triple tax advantage because they can help you save money on taxes in three ways.

First, any pre-payroll funds you or your employer contribute to your FSA are not subject to income tax. With an HSA, any funds you deposit can be deducted from your yearly tax return. Both routes lower your taxable income. (The 2025 HSA contribution limit is $4,300 for individuals and $8,550 for families. Individuals can deposit $3,300 to their FSA, and some employers match a portion as a health incentive.)

Secondarily, HSA accounts incur interest. While you can only deposit a limited amount every year, unused funds roll over to the following year. So with time, you can earn interest on increasingly saved funds. Most accounts offer nominal interest rates, so they’re generally not used for incurring growth. But again—anything left in your account remains untaxed.

Some HSA providers also allow you to invest a portion of your banked funds. Many limit this avenue, though. So check with your HSA manager if you’re curious.

The third (and most significant) tax advantage? You can withdraw funds for qualified medical expenses. And because those funds remain un-taxed, you’ll pay less for your medical costs.

What are the FSA/HSA withdrawal rules?

FSA funds can only be used for medical expenses. If you withdraw HSA funds for medical expenses, you won't pay any fees, taxes or penalties on the withdrawn funds.

You can withdraw HSA funds for any reason. But if you’re under 65 and you withdraw funds for non-medical expenses, you’ll pay a 20% HSA withdrawal penalty fee on the amount. You’ll also pay income tax on the amount you withdraw.

After age 65, you’ll pay income tax on HSA funds you withdraw for non-medical costs. But you won’t be penalized for withdrawing the funds as you might be with other retirement accounts.

What can HSA be used for?

The IRS determines what qualifies as a medical expense. General qualified health care expenses include insurance premiums (HSA only), annual exams, lab fees, scans, eye exams, dental treatments and surgeries.

Further qualified medical expenses include:

• Abortions
• Birth control pills, patches, etc.
• Pregnancy tests and fertility procedures
• Vasectomy procedures
• Breast pumps and supplies
• Breast reconstruction surgery
• Acupuncture services
• Chiropractic services
• Alcoholism and drug addiction services (in-patient treatment, transportation to AA etc.)
• Ambulance services
• Home improvement for disability accommodations
• Eye exams, surgeries, eyeglasses and contact lenses
• Guide dogs or other service animals
• Dental treatments
• Crutches, walkers, wheelchairs and other ambulatory devices
• Hearing aids
• Weight loss programs
• Braille books and magazines and televisions with captioning
• Psychology, psychiatry or therapy sessions
• Nursing and other home services

Some of the above only qualify if you have a related medical condition. For example, you can only use HSA funds to buy a television with closed captioning if you are deaf or have other hearing loss.

On top of the above, you can use HSA funds to buy a broad range of devices and supplies. Often collected online in “HSA stores,” these can include smart scales to help with weight management, heating pads to temper arthritis pain and Covid-19 protective items like masks, hand sanitizer, tests or air purification systems.

If you have any questions about whether or not an upcoming purchase may qualify, talk to your HSA administrator.

Can I use my FSA or HSA for gym membership?

If you exercise to prevent or treat a medical condition like high blood pressure, back pain, high cholesterol, a mental illness or heavy weight, you may be able to use HSA funds to pay for fitness expenses! Tax reductions could help you save up to 40% on gym memberships, fitness class fees, personal training sessions, health apps and more.

The caveat? For those expenses to qualify, you need a Letter of Medical Necessity from a licensed provider detailing how exercise is a treatment for your condition.

Fortunately, Dr. B may be able to help you skip the waiting room and get a Letter of Medical Necessity online! Just take a $15 consultation—no appointment or video meeting required. We’ll connect you with a licensed provider. If you qualify, they’ll email your letter within three working hours.

Learn more from Dr. B about using HSA funds for gym and other fitness fees—including how to use Flexible Spending Account (FSA) funds for fitness, too.

Can I use my FSA or HSA for massage?

If you get a massage to work out the soreness from an awesome workout, you can’t use your HSA to pay for it.

But if you have a medical condition, injury or disability and a provider states that a massage may ease or treat related symptoms, HSA withdrawal rules may qualify the expense as medically necessary!

You’ll need a provider to write a Letter of Medical Necessity before you can file rehabilitation therapy receipts for HSA reimbursement. So if you have a condition like chronic pain, fibromyalgia, headache, PTSD, stress, sleep disorders and many more, learn more about HSAs and medical massage from Dr. B.

Or take a $15 rehab consultation to find out if you can get a Letter of Medical Necessity for massage online!

Sources:

Folks, Jason. IRS bumps up 2025 FSA contribution limits. HealthEquity.

Health Insurance Marketplace. (2023). What’s a health savings account?

Internal Revenue Service. (2023). Administrative, procedural, and miscellaneous tax forms and instructions. 26 CFR 601.602.

Internal Revenue Service. (2023). Publication 969: Health savings accounts and other tax-favored plans.

Internal Revenue Service Department of the Treasury. (2023). Publication 502: Medical and dental expenses.