Are Knee Braces an HSA Eligible Expense?
Clarify HSA eligibility for common medical devices and understand the documentation needed for tax-advantaged health spending.
Health Savings Accounts (HSAs) offer a tax-advantaged way to save and pay for qualified medical expenses. Paired with high-deductible health plans, HSAs provide a triple tax benefit: tax-deductible contributions, tax-free earnings growth, and tax-free withdrawals for eligible expenses. These accounts are a flexible tool for managing healthcare costs, empowering individuals to build tax-free savings for current and future medical needs.
Understanding Qualified Medical Expenses
Understanding what constitutes a “qualified medical expense” is essential for effective HSA use, according to Internal Revenue Service (IRS) guidelines. The IRS defines medical expenses as costs for the diagnosis, cure, mitigation, treatment, or prevention of disease, or for affecting any body structure or function. These definitions are detailed in IRS Publication 502.
Qualified medical expenses include payments for doctor visits, prescription medications, dental care, and vision services. The expense must be primarily for medical care, not merely for general health benefits like vitamins without a prescription or a vacation. Equipment, supplies, and diagnostic devices for medical purposes also qualify.
Knee Braces as Eligible Expenses
Knee braces are considered qualified medical expenses under IRS guidelines. As medical devices, they treat, mitigate, or alleviate physical conditions, affecting body function. They are used for injury recovery, pain management (e.g., arthritis), post-surgical support, or to prevent further injury.
These devices are classified as durable medical equipment and include types like hinged braces, compression sleeves, post-operative braces, and patella stabilizers. A knee brace must be used for a medical purpose, not solely for general athletic performance or preventive support without a medical condition. For most over-the-counter knee braces, a prescription or Letter of Medical Necessity (LMN) is not required.
HSA Documentation and Reimbursement
Proper documentation is important when using your HSA, especially for purchases like knee braces. Keep detailed receipts showing the date, item description, and amount paid. While a doctor’s note or prescription is not always required for common knee braces, retaining such documentation is recommended, especially for less common items or in case of an IRS audit. These records prove expense eligibility and help avoid tax penalties.
HSA funds can be used by directly paying with an HSA debit card or by paying out-of-pocket and then reimbursing yourself. Many HSA providers offer online portals or mobile apps to submit reimbursement claims by entering expense details and uploading receipts. There is no time limit to reimburse yourself for qualified medical expenses, provided the expense was incurred after your HSA was established.