Health spending account (HSA) guide: eligible expenses

Overview

A Health Spending Account (HSA) offers a tax-efficient method to cover a broad spectrum of health and dental expenses. For those with existing coverage through a traditional insurance group plan, it's advisable to utilize that primary coverage initially. The HSA serves as a supplementary resource, covering any remaining balances, including deductibles, co-payments, and expenses not covered by your primary insurance plan.

When submitting claims, always include the "Explanation of Benefits" from your insurance provider, which details the payment made towards each expense. Digital copies of this document are acceptable and can be found online from your insurance provider's online self-serve client portal.

If you don't have an insurance plan, you can submit your expenses directly to your HSA provider.

Eligible Expenses

Most eligible expenses can be for services in Canada or outside Canada, but some must be in Canada (for example, attendant care, and fees paid to a fertility clinic or donor bank). This list is a guide only, and the Canada Revenue Agency (CRA)’s guidelines prevail in cases of discrepancy.

Prescription Medications:

Eligible:

• Medications prescribed by a licensed medical practitioner and dispensed by a pharmacist. Official prescription receipts are required and must reference the patient name, drug name, drug DIN identification number, prescribing doctor name, amount paid and date.
• Injection fees and insulin treatments.

Not Eligible:

• Over-the-counter items like vitamins and naturopathic remedies.

Vision Care:

Eligible:

• Prescription eyewear, including eye glasses, sunglasses, and contact lenses. These can be purchased either in-store, or online. Related expenses such as taxes and shipping are also eligible.
• Clip-on sunglasses and non-prescription sunglasses are eligible when submitted with prescription eye glasses and contact lenses respectively.
• Services from eye care professionals (Ophthalmologist, Optometrist and Optician) including eye exams, laser eye surgery, and vision therapy.

Not Eligible:

• Over-the-counter items like contact lens solution and generic reading glasses.

Dental Services:

Eligible:

• All dental and orthodontic services provided by licensed practitioners.
• Braces and clear aligners.

Not Eligible:

• Cosmetic procedures (e.g. teeth whitening, home bleaching kits, dental veneers, others) are not eligible as they are considered non-essential.
• Cosmetic procedures are only eligible if deemed medically necessary and accompanied by a doctors note confirming same.

Wellness and Specialist Care:

Eligible:

• Any service performed by a qualified medical practitioner (one authorized to practise in the province, territory or country where the service is provided, as recognized by the CRA), including the following. Some are recognized only in certain provinces, so check with your plan administrator.
  • Acupuncturists
  • Allergists
  • Chiropractors
  • Cosmetic Surgeon (procedures that are not purely cosmetic)
  • Dermatologist (procedures that are not purely cosmetic)
  • Dieticians
  • Homeopaths
  • Kinesiologists
  • Naturopaths
  • Physiotherapists
  • Podiatrists/Orthopedists (foot orthotics)
  • Psychiatrists
  • Psychologists
  • Registered Massage Therapists
  • Social Workers
• Fees paid to a weight-loss clinic, to the extent the treatment is given by a medical practitioner.
• If a procedure is required as a result of a medical condition or considered “medically necessary” for mental wellness reasons, a doctor’s note will be required for its consideration.

Maternity and Reproductive Health:

Eligible:

• Baby Breathing Monitors (prescription from a medical practitioner required)
• Breast pumps
• Freezing and storage of eggs or sperm
• Gynecologist
• In vitro fertilization, including fees paid to a fertility clinic or donor bank in Canada to obtain donor sperm or eggs (check with your plan administrator)
• Midwife Services
• Obstetrician (Pregnancy, Childbirth, Postpartum Specialist)
• Pre-natal/post-natal/maternity classes led by CRA authorized medical practitioner
• Prescription Birth Control

Family Care:

Eligible:

• The following, where the CRA’s conditions are met (check with your plan administrator for the documents needed):
  • Acne treatment, and treatment of acne scarring that is not purely cosmetic (your plan administrator may ask for a doctor’s note)
  • Full-time attendant or care in a nursing home for patients with prolonged mental or physical impairment. A medical practitioner must certify the impairment, and your plan administrator may ask for the certificate.
  • Home care (the attendant can’t be the patient’s spouse or common-law partner, or under 18, and some plans have stricter rules, so check with your plan administrator)
  • Learning assistance and tutoring services (supplementary to primary education, provided by someone whose business is tutoring people who aren’t related to them, and certified in writing by a medical practitioner as needed), and specialized schools for individuals with a diagnosed learning disability. Contact us for specific document requirements.
  • Learning Psych Assessment needed for Individualized Program Plan (IPP) educational provisions
  • Lip Reading
  • Pediatrician (Children’s Physician)
  • Reasonable costs for adapting a residence to accommodate a disabled person (i.e., wheelchair ramp, lifts, bath facilities)
  • Sign language training
  • Specially trained animals to assist blind, deaf, or severely impaired persons, including the cost of its care and maintenance
  • Speech Therapists

Health Equipment and Devices:

Eligible:

• Artificial eyes/limbs/Prosthesis
• Artificial kidney machine
• Blood glucose meter
• Brace for a limb (e.g., Core Shorts, compression stockings and sized limb braces)
• Crutches
• Diabetic pumps
• Heart Monitors
• Hospital beds for home
• Neck/Spinal brace
• Osteogenesis Stimulator (healthy bone repair therapy)
• Sleep Apnea (e.g., CPAP machines and supplies)
• Vision/Hearing/Speech impaired aids
• Wheelchair
• Wigs (medical reasons)

Contact your HSA provider for specific documentation requirements.

Hospital and Medical Services:

Eligible:

• Ambulance Charges, including Medi-Van patient transport (non lights/sirens)
• Anesthetist
• Audiology/Speech
• Blood transfusion/Bone Marrow
• Hospital bills/Use of operating room
• Hydrotherapy (water therapy for pain management). This excludes hot tub purchases.
• Organ Transplant/Transplant
• Ultra-violet ray treatments for skin conditions (e.g., psoriasis)
• Vaccines/Injections/Insulin treatments
• X-Ray Treatment/Technician

Insurance Premiums:

• Premiums for private health insurance plans are eligible, including medical, dental, and hospitalization plans. They can be claimed as a medical expense, as long as all or substantially all of the premiums paid under the plan are for eligible medical expenses. Premiums for provincial health plans are not eligible. For more information, see the CRA’s page Medical expenses, including payments from a private health services plan (PHSP) (opens in a new tab) and Income Tax Folio S1-F1-C1, Medical Expense Tax Credit (opens in a new tab).

Additional Covered Expenses:

• Costs related to travel for medical treatment may be eligible if equivalent medical services are not available near the patient’s home, the route travelled is reasonably direct and it is reasonable in the circumstances to travel there for treatment. If the patient travels at least 40 kilometres one way, public transportation (for example, taxis, bus or train) may be eligible, or vehicle expenses where public transportation isn’t readily available. If the patient travels at least 80 kilometres one way, accommodation, meals and parking may also be eligible. The same expenses for an accompanying attendant may be eligible if a medical practitioner certifies in writing that the patient can’t travel alone. Proof of medical appointment is needed.

Contact your HSA provider for travel forms and further requirements.

HSA Claim Submission Guidelines

For all claims, ensure documentation is thorough, including detailed receipts and, where required, medical justification. For specific items or services, consult with your HSA provider to understand the necessary documentation and eligibility criteria.

If you have an insurance plan, submit your claims to your plan first. You can subsequently submit the “Explanation of Benefits” to your HSA provider for reimbursement of any remaining amounts that are not reimbursed by your insurance plan.

This guide aims to provide a clear understanding of how to leverage your Health Spending Account (HSA) effectively. However, always refer to the CRA's guidelines for the most authoritative and up-to-date information on eligible expenses.