Eye drops HSA approved vs HSA eligible

“HSA approved” isn’t an IRS category. The IRS defines qualified medical expenses and doesn’t approve individual products. Since the CARES Act of 2020, over-the-counter medicine counts as a qualified medical expense whether or not it’s prescribed, so OTC lubricating eye drops are generally HSA eligible. Whether a specific store’s card reader accepts them is a separate question decided by the plan, its administrator and the merchant.

Eye drops HSA approved: where the phrase comes from

“HSA approved” shows up on store shelf tags, shopping filters and product pages. It’s marketing shorthand, usually meaning the item is coded so an HSA or FSA debit card will go through at checkout. That’s useful information, but it’s a statement about a store’s system, not an IRS ruling.

The IRS doesn’t publish a list of approved brands or products for health savings accounts. Instead, IRS Publication 969 defines qualified medical expenses by pointing to the tax code’s definition of medical care. An expense either fits that definition or it doesn’t. No product needs a federal sign-off to qualify, and a sticker saying “approved” doesn’t make an ineligible item eligible.

Eye drops HSA eligible: what the IRS actually says

Before 2020, an HSA could pay for over-the-counter medicine only with a prescription (insulin was the exception). The Coronavirus Aid, Relief, and Economic Security Act, signed March 27, 2020, changed that. IRS Publication 969 now says over-the-counter medicine, whether or not prescribed, counts as medical care for amounts paid after 2019. Health FSAs follow the same rule.

Lubricating eye drops sold over the counter are medicine with a Drug Facts label. Quell’s label lists the Uses as: For use as a protectant against further irritation or to relieve dryness of the eye. Its active ingredients are Glycerol (1.0%), Polysorbate 80 (1.0%) and Light Mineral Oil (0.5%). That puts it in the same broad group as any other OTC medicine for HSA purposes. Our guide to why OTC eye drops count for HSA and FSA covers the history in more detail.

Eye drops HSA approved vs eligible, side by side

• Eligible: a tax-law idea. The IRS sets the rules through the tax code and explains them in Publication 969.
• Approved: a retail idea. A store or card network has coded the item so an HSA card can pay for it at the register.
• An item can be eligible but not coded at a particular store, which is why a card might decline even though the purchase qualifies.
• An item can be coded at a store and still be something you need to justify with records, because coding doesn’t replace your own recordkeeping.
• Your plan or account administrator may add its own procedures, such as asking for receipts.

Who decides at the checkout

Several parties handle an HSA purchase, and none of them is the IRS. Your HSA trustee or custodian (often a bank) holds the money and issues the card. The card network and the merchant decide how purchases are categorized at the point of sale. For a health FSA, IRS Publication 969 notes that these are employer-established plans, so the employer’s plan documents and its administrator set how claims are submitted and checked.

If a card declines, the purchase may still be eligible. The usual options are to pay another way and reimburse yourself from the HSA, or to submit a claim to your FSA administrator with the receipt. Our step-by-step guide on how to file an FSA claim for eye drops walks through it.

Keeping records for eye drops paid from an HSA

HSA rules put the responsibility for showing an expense qualifies on the account holder, not the store. Publication 969 tells account holders to keep records showing their distributions paid for qualified medical expenses. A few habits make that easy:

• Save the order confirmation email. For a Quell order, it lists the product, quantity and amount paid.
• Keep a simple folder or spreadsheet with the date, item and amount of each HSA purchase.
• If you reimburse yourself later, note which receipt each withdrawal covers.
• For an FSA, follow your administrator’s instructions on what to upload and when.

You can look up a past Quell order on the orders page, and our guide on getting a receipt for your order explains what’s on it.

Using an HSA or FSA for Quell

Quell is sold only on quelldrop.com, with guest checkout and no subscription. Whether your particular HSA or FSA card is accepted when you pay depends on the card and the plan, so we can’t promise it will go through. If it doesn’t, paying another way and reimbursing yourself or claiming through your administrator are the routes Publication 969 leaves open. Shipping is $10.00 per order; whether a plan reimburses shipping is a question for your administrator.

This guide explains how the rules are written, not your personal tax situation. For that, ask your plan administrator or a tax professional. The broader picture of both accounts is in Can I use HSA or FSA funds for eye drops?.