If you’re a business owner selling health-related products, you might wonder if your inventory items qualify for HSA payments. With the rising popularity of Health Savings Accounts (HSAs), customers are actively looking for eligible items they can buy with their pre-tax funds. Figuring out whether your products meet the requirements can seem complicated, but it doesn’t have to be.
This guide will help you understand what qualifies as HSA-eligible, how to evaluate your inventory, and how to set up HSA for merchants so customers can spend HSA funds in your store.
Why HSA Payments Matter
Millions of Americans have health savings accounts (HSAs), which allow them to save pre-tax dollars to pay for medical expenses. Customers use HSA cards linked to these accounts to purchase eligible healthcare-related products directly.
This presents a big opportunity for businesses as individuals with HSAs are always looking for qualified products in physical stores and online. By offering HSA-eligible items and accepting HSA payments, you can tap into a growing market and improve sales.
IRS Guidelines for HSA Eligibility
Understanding IRS rules is the first step in determining if your inventory qualifies for HSA payments. To qualify, a product must primarily serve a medical purpose or directly improve physical health. The IRS defines these as “qualified medical expenses” in its guidelines.
Common HSA-eligible products include:
● Medical supplies include first-aid kits, thermometers, and blood pressure monitors.
● Vision and dental care: Prescription eyeglasses, contact lenses, and dental guards.
● Over-the-counter medications: Pain relievers, cold remedies, and allergy treatments.
Products that don’t have a direct medical purpose, such as cosmetic items, luxury skincare, or some fitness equipment, are typically excluded unless prescribed by a doctor.
Evaluating Your Inventory for HSA Eligibility
If you’re unsure whether your products qualify, here’s how to find out:
1. Conducting an Audit: Review your inventory and identify products with a clear medical or health-related purpose. Items in categories like vision care and medical supplies are usually safe bets.
2. Using Technology for Accuracy: Invest in tools that automatically flag eligible products based on IRS criteria. These solutions help ensure compliance and save time compared to manual reviews.
3. Consulting with Experts: If you’re still uncertain, consult an expert experienced in HSA compliance. They can confirm whether your products align with IRS guidelines.
How Customers Can Spend HSA Funds in Your Store
Once you’ve identified which products in your inventory qualify for HSA payments, the next step is to make it easy for them to use their HSA funds in your store:
1. Clearly Label HSA-Eligible Products
To make it simple for customers to identify which items qualify for HSA payments, add tags like “HSA Eligible” to product listings. You can also create a dedicated category or filter on your website, such as “Shop HSA Products,” to make browsing easier.
2. Provide Clear Guidance
Many customers aren’t entirely sure what qualifies for HSA funds. Use your website to educate them by including a FAQ section or a guide like, “How to Use HSA Funds in Our Store.” This helps build trust and removes any hesitation they may feel about using their HSA for purchases.
3. Enable HSA-Friendly Payment Options
Integrate a payment processor that accepts HSA for merchants directly at checkout. This eliminates customers’ need to manually file reimbursement claims, making their shopping experience faster and more convenient. Also, consider using a payment processor that offers HSA auto reimbursement to simplify the process for your customers.
4. Highlight Seasonal Promotions for HSA-Eligible Products
Encourage customers to use their HSA funds by running seasonal promotions or reminders, especially toward the end of the year when customers are more likely to spend their remaining funds.
Benefits of Selling HSA-Eligible Inventory
Customers love the ability to spend their pre-tax dollars on healthcare items, and using a payment processor that allows HSA card payments and facilitates HSA auto reimbursement makes it even easier by ensuring quick, hassle-free refunds. This convenience builds trust and keeps customers coming back for more. Offering these products also helps your business stand out from competitors, attracting a wider audience in the growing health and wellness market. With millions of people using HSAs to manage their healthcare costs, stocking eligible products gives you a chance to tap into this expanding opportunity and drive your sales higher.
