Can You Purchase Birth Control Using Your HSA?

When it comes to birth control, many people may think of typical contraceptives such as "the pill" or condoms. However, birth control is so much more. It falls under the family planning category, encompassing everything from medication to surgical intervention.

In a survey by the CDC, nearly all women used some form of birth control during their lifetime. From 2017 to 2019, nearly 2 in 3 women between the ages of 15 to 49 were actively using contraception.

The cost of birth control can vary widely depending on your chosen method and insurance status. Many people can obtain free birth control management under the Affordable Care Act (ACA). But the out-of-pocket costs can still add up for people who may lack insurance, have a copayment, or have insurance that doesn't cover their birth control method of choice.

A health savings account (HSA) can offset the costs of qualified birth control and other family planning expenses. Below we'll break down how an HSA works and what you should consider if purchasing birth control.

How does a health savings account work?

An HSA is a pretax savings account that works in combination with a high-deductible health plan (HDHP). Your HSA will allow you to set aside money to offset the cost of any eligible healthcare costs, including deductibles, copays, and coinsurance.

Aside from having a HDHP, you must also meet a few other IRS eligibility requirements to contribute to an HSA, which include:

• You can not have any additional health coverage unless the IRS permits it.

• You are not currently on Medicare.

• You do not appear as a dependent on anyone else's tax return.

HSAs are also portable, meaning that it always belongs to you even if you change employers or if you no longer work. If you do not use all the funds in your HSA by the end of the year, the money will roll over to the following year. Any funds you withdraw from your HSA will remain tax free only when paying for qualified health expenses.

HSAs restrict how much you can deposit into your account annually. For example, you can contribute up to $3,850 to an individual HSA in 2023. Your contribution goes up to $7,750 for a family HSA. People age 55 and over can contribute an extra $1,000 a year. It’s important to review the HSA limits for your contribution year to ensure you don’t overfund your HSA.

What are HSA-eligible items?

Aside from copayments, coinsurance, and deductibles, an HSA can come in handy when you have out-of-pocket medical costs not covered by insurance. An expense must meet the criteria set by the IRS in Publication 502 to qualify for HSA tax-free benefits.

Qualified medical expenses refer to the costs of healthcare services, equipment, or supplies necessary to alleviate or prevent a physical or mental disability or illness. While some over-the-counter supplies are included, like menstrual care products and Tylenol, general health products like vitamins are not. However, prenatal vitamins are an eligible expense because they promote healthy fetal growth and development.

If you’re not sure if your expense is HSA-eligible, you can check with your HSA administrator beforehand.

Is birth control covered by HSA?

It depends. IRS Publication 502 provides a list of items that qualify as a medical expense. However, the list does not include every possible medical expense. The birth control product or service you choose must meet the requirements of a qualified medical expense to determine if it’s HSA eligible.

You can also check with your HSA benefit administrator to verify eligible expenses ahead of time. However, typically any FDA-approved family planning expense that a doctor prescribes for the process of birth control can be purchased using your HSA.

Some common birth control items you can be purchase with an HSA include:

• Birth control pills

• Condoms

• Spermicides

• Contraceptives gels

There are many family planning healthcare expenses that you can pay for using your HSA. Some family planning services include:

• Contraception services

• Infertility services

• Pelvic examinations

• Pregnancy achievement and preconception

• Pregnancy testing

Which types of birth control are HSA eligible?

While your insurance may cover a full range of birth control methods at 100%, you may still encounter out-of-pocket costs for certain brand name prescriptions. Your HSA can help you cover the costs for the following FDA-approved methods:

• Birth control pills

• Contraceptive patch

• Barrier methods

• Intrauterine devices (IUDs)

• Birth control injection

• Morning-after pill

• Sterilization

• Condoms

• Vasectomy and vasectomy reversal

How much does each type of birth control cost?

Under the Affordable Care Act (ACA), health plans within the health insurance marketplace must cover FDA-approved birth control methods and counseling your doctor prescribes at no out-of-pocket cost to you. So, if you have insurance and your doctor is in-network, you may pay as little as $0.

Some exceptions to the ACA where you may have to pay out-of-pocket for birth control may include religious employers or religious nonprofit organizations like churches. However, if your plan does not participate in the ACA or you do not have insurance, here are some typical costs of common contraceptives.

The annual cost of birth control can be more than $2,000 if you are paying out of pocket. Your total costs will vary based on your insurance plan and birth control method. Inflation may also boost the average cost you pay.  

How do I use my HSA to buy birth control?

You can open an HSA through your employer, local bank, or brokerage firm. When opening one through your employer, you can add money to your HSA through payroll deduction. You decide how much you want to contribute every pay period. These contributions are not subject to tax.

Once your account is open, you can access your HSA funds by doing the following:

• Using an HSA debit card: You can use this to pay for purchases directly at point of sale.

• Using online bill pay: Use the website or mobile app to pay the provider directly.

• Writing a check: You may be able to order checks to pay for purchases.

If you pay for birth control out of pocket, you can reimburse yourself by using the same three methods above to pay yourself instead of the provider. The only difference is that when reimbursing yourself online, you can transfer the money from your HSA directly into your personal bank account. However, when paying back yourself, keep in mind that expenses must:

• Meet qualified medical expense criteria

• Occur after your HSA account is established

The IRS will charge a 20% penalty if you use your HSA for ineligible expenses. You can verify with your HSA administrator that your chosen form of birth control is a qualifying medical expense.

Most importantly, you should always keep track of the following records for insurance purposes or in the event of an IRS audit when using your HSA:

• Purchase receipts

• Explanation of Benefits (EOB)

• Medical diagnosis/physician diagnosis letters

• Copy of prescriptions

Do I need a prescription to get birth control?

It depends. Over-the-counter birth control like condoms and spermicides do not require a prescription.

However, many states do require a prescription to obtain birth control pills. The good news is that at least 15 states now allow pharmacists to prescribe contraceptives, including birth control pills. This helps eliminate a separate visit to a healthcare provider. Here is a list of states where pharmacists can write prescriptions:

• California

• Colorado

• Hawaii

• Idaho

• Illinois

• Maryland

• Minnesota

• New Mexico

• North Carolina

• Oregon

• Tennessee

• Utah

• Vermont

• Virginia

• West Virginia

Do I need a prescription in order for my birth control to be covered by HSA?

It depends. The CARES Act of 2020 stipulates that purchasing over-the-counter medicine (whether or not prescribed) after 2019 can be treated as medical care and covered by your HSA. In this sense, condoms, spermicides, and other OTC forms of birth control are eligible expenses that do not require a prescription from a healthcare provider.

On the other hand, contraceptives like birth control pills, patches, and vaginal rings typically require a prescription. Therefore, you will still need a prescription from a healthcare provider to purchase these methods using your HSA.

How can I get birth control for free?

Getting birth control free may depend on factors such as your insurance and the type of birth control method. There are also government resources and programs like Medicaid that can cover the cost. One report shows that Medicaid provides the largest reproductive healthcare coverage in the U.S. and pays 75% of all publicly funded family planning services.

The Affordable Care Act (ACA) specifies that insurers should cover 100% of preventive healthcare, such as recommended birth control and breastfeeding counseling, when prescribed by an in-network provider. Even if you have not met your health plan deductible, you should not have to worry about out-of-pocket costs.

However, the ACA does not force health plans to cover every brand of medication or device equally within birth control categories. So, if your insurer does not cover a particular birth control brand, your healthcare provider can order a similar alternative from their specific list of covered medications.

Still, even without health insurance, there are ways to get birth control for free. Here are a few options:

• Planned Parenthood

• Federally qualified health centers (FQHCs)

• Community health or nonprofit clinics

• Government resources

• Free and charitable clinics

What other sexual health products are HSA eligible?

Aside from birth control, the good news is that your HSA can help with many of your sexual health needs.

For example, some other sexual health products that are HSA eligible include:

• Fertility treatment, including in vitro fertilization (IVF)

• Physical exams

• Pregnancy tests

• Ovulation predictor tests

• Medical expenses that treat impotence and sexual inadequacy are reimbursable if you have a medical diagnosis

• Sexual counseling

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Written by:

DeShena Woodard, BSN, RN

DeShena Woodard, BSN, RN, is a Texas-based registered nurse, freelance writer, financial freedom coach, and certified life coach. Writing about personal finance for more than 3 years, her advice has been featured on Yahoo Finance, Business Insider, NerdWallet, Debt.com, GoBankingRates, the Balance, and also on her own website, ExtravagantlyBroke.com.

Edited by:

Charlene Rhinehart, CPA

Charlene Rhinehart, CPA, is a personal finance editor at GoodRx. She has been a certified public accountant for over a decade.

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