There are a host of medical and related costs that can be paid using funds from your HSA on a tax-free basis.
A. Long Term Care Premium
HSA dollars can be used to cover the cost of your long-term care insurance premiums. There are two caveats to be aware of. First, be sure your policy is a tax-qualified policy. Most LTC policies today are qualified, but you should verify this, nonetheless. Second, there are limits as to the amount that can be withdrawn from the HSA each year to cover these costs based on your age.
B. Medicare Premiums
Medicare premiums and deductibles, including Medicare Parts A, B, D and Medicare HMO premiums, can be covered by HSA funds on a tax-free basis, whether you pay them directly from your Social Security benefits or you write a check for the premiums. HSA funds cannot be used to pay Medigap premiums.
C. Other Health Care Costs
Medicare does not cover all types of health care expenses. Some examples of expenses not typically covered by Medicare Parts A and B that can be paid via HSA funds include:
- Most dental care
- Eye exams that are related to prescribing glasses
- Dentures
- Cosmetic surgery
- Acupuncture
- Hearing aids and related exams
- Routine foot care