Can you use a health savings account (HSA) for prescriptions?

Key takeaways

• Health savings accounts allow you to pay for both prescription medications and over-the-counter drugs like pain relievers and antacids using pretax dollars.
• Since 2020, federal law has expanded eligible purchases to include nonprescription medications and menstrual care products, which most insurance plans do not cover.
• You can maximize savings by comparing your insurance copayment against discount card prices, as costs that go through insurance typically count toward your deductible, while discount card purchases may not.

Overview

If you have a health savings account (HSA), you can use it to buy prescription medications.

You can also use your HSA to buy nonprescription or over-the-counter (OTC) medications, like Tylenol, Tums, Maalox, and Zyrtec. The Coronavirus Aid, Relief, and Economic Security (CARES) Act expanded HSA eligibility to include these drugs and also allowed the use of HSA funds for menstrual care products.

Many health insurance plans don’t typically cover OTC medications or menstrual care products.

In this article, we may use some terms to help you when selecting the best insurance plan:

• Deductible: This is an annual amount you must spend out of pocket within a certain time period before an insurer starts to cover costs.
• Coinsurance: This is a percentage of a service cost that you’ll need to cover yourself.
• Copayment: This is a fixed dollar amount that you pay when receiving certain services, including filling prescriptions.

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What is an HSA?

An HSA is a financial account you can set up if you have a high deductible health plan (HDHP), and you can use it for eligible medical expenses. Banks and insurance companies typically offer HSAs, but they’re not available to people enrolled in Medicare plans.

You can add pretax money to your HSA. For example, if you make $28,500 per year and put $2,500 in your HSA, you will be taxed as though you make $26,000 instead.

Plus, your HSA deposits can earn tax-free interest. And your HSA contributions can carry over from year to year, even if you retire or change jobs.

You can only set up and make deposits to an HSA if you have an HDHP.

For 2026, an HDHP must have a deductible of at least $1,700 for individual coverage or $3,400 for family coverage. Annual out-of-pocket expense maximums cannot be higher than $8,500 for single coverage in 2025 or $17,600 for family coverage.

Out-of-pocket expenses may include copayments, coinsurance, and deductibles, but do not include premium costs.

The Internal Revenue Service (IRS) also confirmed that the 2025 contribution limit will increase to $4,400 for an individual and $8,750 for a family.

Using your HSA for prescription drugs

When a doctor prescribes a medication, they’ll call the prescription into your preferred pharmacy, send it electronically, or give you a written prescription to take to a pharmacy.

The pharmacy will fill your prescription. You can use prescription discount cards, like the Optum Perks Discount Card, to ensure the best price for your medications. You can use the HSA to pay for your items, and many HSAs will come with a debit card.

If you don’t have an HSA debit card or choose not to use it, you can pay for your items as you usually would. But remember to save the receipt as a record for your self-reimbursement from your HSA.

Health plan prescription coverage

If you have coverage for prescription medications through your health insurance plan, you may find that it’s more cost-effective to use your insurance.

You can check your plan’s drug list, also called a formulary, to see if the drugs a doctor prescribes are included in your plan. If they’re included, you may only have to pay a copayment for your medications.

Formularies are typically split into different tiers, with the most common or lower cost medications in lower tiers. It’s important to check your drug list with your insurer directly, as they can differ from plan to plan and insurer to insurer.

Also, if you use your insurance, eligible costs will count toward your deductible. This may not be possible when using a discount card or coupon. But you can check your plan rules with your plan provider.

If you need help covering the cost of medications, the free Optum Perks Discount Card could help you save up to 80% on prescription drugs. Plus, you can now get them delivered to your home in as little as 3 days. Search for your medication here.

What does an HSA cover?

Along with prescription drugs, your HSA covers eligible medical expenses as defined by the IRS, including:

• medical care
• vision and dental care expenses, plus hearing aids
• qualified capital expenses, such as special medical equipment installed in your home
• mental health care
• qualified diagnostic devices, like a blood sugar test kit, to monitor your blood sugar level
• laboratory fees
• qualified long-term care services

For a detailed list, the IRS publishes a directory of medical expenses.

Summary

If you have an HSA, you can use it to pay for your prescriptions, including discounted prescriptions, when using a discount card or coupon.

You can also use it for other eligible medical expenses, like medical care, mental health care, dental and vision care, and OTC medications.

Download the free Optum Perks Discount Card to save up to 80% on many prescription medications. Plus, you can now get them delivered to your home in as little as 3 days. Search for your medication here.