Your health savings account (HSA) or flexible spending account (FSA) can pay for more than you might think — including prescriptions, over-the-counter medicines, dental care, and vision expenses. Knowing what qualifies helps you spend pre-tax dollars wisely and reduce out-of-pocket costs all year.
Find the lowest price on any eligible prescription at RxDiff before you fill using your FSA or HSA funds.
FSA eligible expenses are medical costs the IRS determines qualify for reimbursement from a flexible spending account. The IRS defines these as expenses that treat, prevent, or diagnose a medical condition. Qualified costs include prescription medications, over-the-counter medicines, medical equipment, dental care, and vision care. General health and wellness purchases that don't treat a specific condition typically don't qualify. IRS Publication 502 is the definitive reference for what counts.
A flexible spending account is an employer-sponsored benefit that lets you set aside pre-tax dollars for qualified medical costs. You contribute before taxes, reducing your taxable income. The FSA administrator reimburses you for qualified costs during the plan year. Most account funds must be used by year-end — check your plan for grace periods or carryover rules.
HSA eligible expenses follow the same IRS qualified medical expense rules as FSA expenses. The key difference: a health savings account is paired with a high-deductible health plan (HDHP) and funds roll over indefinitely. You can use HSA funds for qualified medical expenses tax-free at any time, including in retirement. Annual contribution limits are set by federal law and can change, so check current IRS guidance.
Health reimbursement arrangements (HRAs) are a third employer-sponsored option, separate from both FSAs and HSAs. An HRA is funded entirely by an employer and reimburses qualified medical expenses up to a plan limit. Unlike either account, employees generally cannot contribute to an HRA themselves.
Yes — prescribed medicines generally qualify as FSA and HSA expenses when used to treat, prevent, or diagnose a condition. This includes maintenance medicines, antibiotics, inhalers, insulin, and specialty medicines. Present an FSA or HSA debit card at the pharmacy counter, or pay out of pocket and submit a receipt to the account administrator.
Using an FSA or HSA to pay for prescriptions provides a tax benefit based on your marginal tax rate. That benefit can supplement a coupon from GoodRx or a price comparison from RxDiff; confirm that the purchase qualifies before paying.
Since the CARES Act, many over-the-counter medicines are eligible without a prescription. Pain relievers, allergy medicines, antacids, cold medicines, and other OTC products may qualify. Check current plan rules and use an FSA or HSA debit card when the account administrator permits it.
General health products such as vitamins taken for wellness rather than a diagnosed condition typically do not qualify without a letter of medical necessity. When uncertain, check the plan administrator's eligible-expense database before purchasing.
Dental expenses that treat or prevent disease are generally FSA and HSA eligible, including cleanings, fillings, crowns, braces, and extractions. Cosmetic procedures such as teeth whitening are not eligible. Vision expenses including eye exams, prescription glasses, prescription contacts, and LASIK surgery may qualify. Non-prescription reading glasses generally do not.
Dependent care flexible spending accounts (DCFSAs) cover childcare and dependent-care costs, separate from health care FSAs. Care expenses for children under 13 and qualifying dependents who cannot care for themselves may qualify. Contribution limits and rules differ from health care accounts, and funds cannot be mixed between account types.
An FSA is usually an employer-sponsored account with plan-specific deadlines and limited rollover. An HSA requires eligibility through a high-deductible health plan, but funds roll over and may be invested for future expenses. Both accounts can cover qualified medical expenses, including prescriptions.
Find a current price for an FSA- or HSA-eligible prescription before you fill.
Compare Prescription Prices on RxDiff →For authoritative information, visit IRS Publication 502 medical expenses.
Are prescription medicines FSA and HSA eligible?
Most prescribed medicines qualify when used for a medical purpose. Use an FSA or HSA debit card, or submit receipts to the account administrator. Confirm that the expense is covered under your plan.
What over-the-counter items are FSA eligible?
Many OTC medicines qualify without a prescription under current federal rules. Products used only for general wellness may need a letter of medical necessity. Check with the administrator when uncertain.
What is the difference between an FSA and an HSA?
An FSA is employer-sponsored, doesn't require a specific health plan, but most funds expire annually. An HSA requires enrollment in a high-deductible health plan but funds roll over fully, can be invested tax-free, and grow for retirement use. Both cover the same IRS-qualified medical expenses including prescriptions.
Can I use my FSA for dental and vision expenses?
Yes — dental expenses that treat or prevent disease (cleanings, fillings, crowns) and vision expenses (eye exams, prescription glasses, contacts, LASIK) are FSA and HSA eligible. Cosmetic dental procedures like teeth whitening are not eligible.
What is a letter of medical necessity for FSA purposes?
A letter of medical necessity is a document from your healthcare provider confirming that a specific product or service is medically necessary to treat your condition. Some FSA expenses — particularly dual-use items or general health products — require this letter before your administrator will reimburse them.
What happens to unused FSA funds at year end?
Most FSA plans have a use-it-or-lose-it rule. Funds not used by year-end are forfeited. Some employers allow a grace period of up to 2.5 months or a carryover of up to $660 (2026 limit), but not both. Check your specific plan. Use year-end balances on eligible prescriptions, OTC items, or dental and vision care before the deadline.
Medical & Tax Disclaimer: This content is for informational purposes only and does not constitute tax or financial advice. FSA and HSA eligibility rules are set by the IRS and may change. Consult your account administrator or a tax professional for guidance specific to your situation.