Over-the-Counter Medicines: FSA and HSA Eligible

Short answer

Over-the-counter medicines like pain relievers, allergy treatments, and cold and cough medicines are reimbursable from your FSA, HSA or HRA without a prescription. The 2020 CARES Act restored OTC drugs to reimbursable status, making everyday health expenses directly eligible from your account.

Your plan document may have its own rules, so check with your administrator if you're unsure about a specific item. Some items are reimbursable outright. Others are reimbursable with a letter of medical necessity.

What your account covers

Your FSA, HSA or HRA covers medical expenses. The IRS defines these as costs of "diagnosis, cure, mitigation, treatment, or prevention of disease and for the purpose of affecting any part or function of the body". Over-the-counter medicines fall under this definition when used to treat a diagnosed condition or maintain health.

Your account can pay for items in three categories: reimbursable outright, reimbursable with a letter of medical necessity, and not reimbursable. Most OTC medicines fall into the first category, requiring no prescription or letter.

How to read the list

Items in this guide are organized by category and labeled by eligibility. Understanding the three categories helps you know what you can claim from your account.

**Reimbursable outright:** You can pay with your FSA or HSA debit card at the pharmacy, or buy the item and submit your receipt for reimbursement. No prescription, no letter required. **Reimbursable with a letter:** A licensed clinician can provide a letter of medical necessity explaining how the item treats a diagnosed condition. Once you have the letter, you can submit your receipt for reimbursement. **Not reimbursable:** These items don't qualify under IRS rules, and no letter will change that. This is final.

Over-the-counter medicines and pharmacy items

In 2020, the CARES Act restored the reimbursability of over-the-counter drugs and medicines, removing the requirement for a prescription. Before the CARES Act, OTC medicines were generally not reimbursable unless prescribed. Today, most common OTC medications purchased at any pharmacy are covered by your FSA, HSA or HRA.

Reimbursable OTC medications include pain relievers, allergy treatments, cold and cough medicines, antacids, sleep aids, decongestants, and topical treatments. You don't need a letter or prescription to claim these. Just keep your receipt and file for reimbursement, or use your debit card at the pharmacy to pay directly.

Personal care and wellness items

Most personal care items are not reimbursable because the IRS classifies them as general toiletries rather than medical treatment. This includes shampoo, deodorant, and soap. However, products purchased specifically for a diagnosed skin or health condition may qualify with a letter.

Vision and dental care

Medical devices and equipment

Devices used to diagnose, treat or manage a health condition are reimbursable from your account. Medical devices include monitors that measure vital signs, machines that provide treatment, and mobility aids that help people with disabilities. These are generally reimbursable outright because they serve a clear medical purpose.

Fitness, recovery, and wellness items

Gym memberships, fitness equipment, massage devices, and wellness tools are reimbursable with a letter when a clinician ties them to treatment of a diagnosed medical condition such as arthritis, cardiac recovery, or chronic pain. Under IRS Publication 502, general wellness purchases with no diagnosed condition behind them don't qualify on their own, so these items need a letter rather than being reimbursable outright.

What changes by plan

Your employer's plan document sets the rules for what your specific FSA or HRA covers. Your HSA coverage is determined by IRS rules, but your plan's administrator applies them. Two examples: your plan might cover over-the-counter antacids outright, while another plan requires a letter. One plan might include certain medical devices in the standard coverage, while another excludes them. This also affects your balance: "FSAs are generally 'use-it-or-lose-it' plans", so unused FSA funds can be forfeited at year end unless your plan offers a grace period or carryover. Your HSA has no such deadline: it's your money for as long as you hold the account. Always check your plan documents, summary plan description, or contact your administrator directly if you're unsure whether a specific item is covered. The plan document is the final authority.

How reimbursement gets paid

Burst files the reimbursement claim with your FSA, HSA or HRA administrator, with a letter of medical necessity attached when the item needs one. Most OTC medicines do not. The administrator reviews the claim and pays you out of your account balance by direct deposit or check. Keep your receipt as proof of purchase. If your claim is denied, Burst refunds your letter fee immediately.

Getting OTC medicine reimbursed with Burst

Burst handles the letter and the claim. You request the letter of medical necessity in about two minutes for $35, a licensed clinician reviews it, and it typically lands in your inbox within 24 hours. Burst files the reimbursement claim with your FSA, HSA or HRA administrator. The administrator pays you out of your account by deposit or check. No letter, no charge. Claim denied, money back. Request it before you buy, because the letter has to be dated on or before the purchase it covers.

Get reimbursed for my OTC medicine

Frequently asked questions

Is Tylenol FSA or HSA eligible?

Yes. Tylenol (acetaminophen) is an over-the-counter pain reliever and is reimbursable outright from your FSA, HSA or HRA. You can use your debit card at checkout or submit a receipt for reimbursement. No prescription or letter is required.

Can I use my FSA or HSA for OTC cold medicine?

Yes. Over-the-counter cold and cough medicines, including cough syrup, throat lozenges and cold tablets, are reimbursable from your FSA, HSA or HRA without a prescription.

Are over-the-counter allergy medicines covered?

Yes. OTC allergy medicines such as antihistamines (loratadine, cetirizine) and decongestants are reimbursable from your FSA, HSA or HRA. Pay directly with your debit card or submit a receipt for reimbursement.

What about OTC sleep aids and melatonin?

OTC sleep aids such as diphenhydramine and doxylamine are medicines and are reimbursable from your FSA, HSA or HRA without a prescription. Melatonin is a dietary supplement, not a drug, so it is reimbursable with a letter from a clinician who ties it to a diagnosed sleep condition.

Are vitamins and supplements FSA or HSA eligible?

Vitamins and supplements are reimbursable with a letter when a clinician recommends them to treat a diagnosed condition such as a B12 deficiency, iron-deficiency anemia, or vitamin D deficiency. General vitamins purchased for overall wellness without a diagnosed condition cannot be reimbursed.

What does 'reimbursable with a letter' mean?

A letter of medical necessity is a brief document from a licensed clinician explaining that an item treats a diagnosed medical condition. Request the letter before you buy the item so it's dated on or before your purchase. Burst files the claim with your administrator, and the administrator pays you from your account balance.

What OTC items are never reimbursable?

Personal care items like deodorant, shampoo, and toothpaste are not reimbursable. Cosmetic products for appearance such as teeth whitening and skincare aren't covered either. Diapers for healthy infants and general food purchases also don't qualify.

What's an OTC card from Medicare Advantage?

An OTC card from a Medicare Advantage plan is a separate benefit that covers certain over-the-counter items. This page covers FSA, HSA and HRA eligibility instead. If you have a Medicare Advantage OTC allowance, check your plan materials for what that card covers.

Keep reading: Complete list of FSA eligible expenses, Complete list of HSA eligible expenses, 75+ Surprising FSA and HSA eligible items, Is mouthwash FSA or HSA eligible?, and all guides on this topic.

Sources

• IRS Publication 502 - Medical and Dental Expenses (Definition of medical expenses, OTC drug eligibility, cosmetic surgery exclusions, nutritional supplement rules, personal use item rules, hearing aids, eyeglasses, dental treatment, health club dues, controlled substances, veterinary services, guide dogs and service animals)

• IRS Publication 969 - Health Savings Accounts and Other Tax-Favored Health Plans (HSA and HRA definitions, general reimbursement eligibility for medical expenses, account contribution and carryover rules, FSA use-it-or-lose-it rule)