Employees can use the HSA to pay for Code §213(d) medical expenses, expenses such as expenditures for medical care, to the extent that such amounts are not reimbursed by insurance or any other source. Medicines and drugs (other than insulin) can be qualified medical expenses only if they are prescribed. Under the CARES Act, employers can also allow for reimbursement of OTC drugs.
With certain exceptions, qualified medical expenses do not include payments for health insurance premiums or coverage contributions toward self-funded health coverage. However, the expense for coverage under any of the following will be an HSA-qualified medical expenses: HSA funds may not be used to pay insurance premiums (or contribute toward self-funded health coverage) except as follows:
- continuation coverage for the HSA account holder, or for his or her spouse or tax dependent;
- a qualified long-term care insurance contract;
- health care coverage while the individual (i.e., the HSA holder or his or her spouse or dependent) is receiving unemployment compensation under federal or state law;
- for account holders age 65 or over, premiums for Medicare and other healthcare coverage other than Medicare Supplement.
Have any questions regarding this notice? Don’t hesitate to contact your Total Benefit Solutions health insurance specialists today at (215)355-2121.