QSEHRA eligible expense - what are they? Do you hear this question a lot from your employees? If you recently set up a QSEHRA (small business HRA) for your small business or startup, it's important to know the facts and share what you know with your employees. Explaining the ins and outs of the HRA is crucial to helping them make the most of it. Read on to read more about what qualifies for reimbursements and what your employees need to know.
Important update! Thanks to the Cares Act, over the counter meds are now a QSEHRA eligible expense without a doctors note, as well as feminine hygiene products! More on the new QSEHRA eligible expenses here.
You know that you can expense your monthly premiums and medical expenses up to your monthly allotment (see 2023 QSEHRA limit). You want to make sure you take advantage of the entire benefit, and max it out. You get the basic gist of what can be expensed, but as you start spending you wonder if more items are eligible for reimbursement than you originally thought.
Your HRA plan document must include a list of what is reimbursable under the account. If you cannot find your plan document contact your employer for another copy. The HRA must follow guidelines set forth by IRS Publication 502 Medical and Dental Expenses. Below is an excerpt of what is included in the manual. Best to keep it as a reference.
QSEHRA Eligible Qualified Medical Expenses
In addition to reimbursing for individual health insurance premiums and spouse's plan premiums, the following are considered Qualified Medical Expenses and are reimbursable with a QSEHRA. The mirror HRA eligible expenses.
Abdominal supports • Abortion • Acupuncture • Air conditioner (when necessary for relief from difficulty in breathing) • Alcoholism treatment • Ambulance • Anesthetist • Arch supports • Artificial limbs • Autoette (when used for relief of sickness/disability) • Birth Control Pills (by prescription) • Blood tests • Blood transfusions • Braces • Cardiographs • Chiropractor • Christian Science Practitioner • Contact Lenses • Contraceptive devices (by prescription) • Convalescent home (for medical treatment only) • Crutches • Dental Treatment • Dental X-rays • Dentures • Dermatologist • Diagnostic fees • Diathermy • Drug addiction therapy • Drugs (prescription) • Elastic hosiery (prescription) • Eyeglasses • Fees paid to health institute prescribed by a doctor • FICA and FUTA tax paid for medical care service • Fluoridation unit • Guide dog • Gum treatment • Gynecologist • Healing services • Hearing aids and batteries • Hospital bills • Hydrotherapy • Insulin treatment • Lab tests • Lead paint removal • Legal fees • Lodging (away from home for outpatient care) • Metabolism tests • Neurologist • Nursing (including board and meals) • Obstetrician • Operating room costs • Ophthalmologist • Optician • Optometrist • Oral surgery • Organ transplant (including donor’s expenses) • Orthopedic shoes • Orthopedist • Osteopath • Oxygen and oxygen equipment • Pediatrician • Physician • Physiotherapist • Podiatrist • Postnatal treatments • Practical nurse for medical services • Prenatal care • Prescription medicines • Psychiatrist • Psychoanalyst • Psychologist • Psychotherapy • Radium Therapy • Registered nurse • Special school costs for the handicapped • Spinal fluid test • Splints • Sterilization • Surgeon • Tampons • Telephone or TV equipment to assist the hard-of-hearing • Therapy equipment • Transportation expenses (relative to health care) • Ultra-violet ray treatment • Vaccines • Vasectomy • Vitamins (if prescribed) • Wheelchair • X-rays
QSEHRA ELIGIBLE OVER THE COUNTER DRUGS
Antacids • Allergy Medications • Pain Relievers • Cold medicine • Anti-diarrhea medicine • Cough drops and throat lozenges • Sinus Medications and Nasal sprays • Nicotine medications and nasal sprays • Pedialyte • First aid creams • Calamine lotion • Wart removal medication • Antibiotic ointments • Suppositories and creams for hemorrhoids • Sleep aids • Motion sickness pills
INELIGIBLE MEDICAL EXPENSES for the Qualified Small Employer HRA
QSEHRA does not reimburse for the following medical expenses:
Advancement payment for services to be rendered next year • Athletic Club membership • Automobile insurance premium allocable to medical coverage • Boarding school fees • Bottled Water • Commuting expenses of a disabled person • Cosmetic surgery and procedures • Cosmetics, hygiene products and similar items • Funeral, cremation, or burial expenses • Health programs offered by resort hotels, health clubs, and gyms • Illegal operations and treatments • Illegally procured drugs • Maternity clothes • Non-prescription medication • Premiums for life insurance, income protection, disability, loss of limbs, sight or similar benefits • Scientology counseling • Social activities • Special foods and beverages • Specially designed car for the handicapped other than an autoette or special equipment • Stop-smoking programs • Swimming pool • Travel for general health improvement • Tuition and travel expenses a problem child to a particular school • Weight loss programs
INELIGIBLE OVER THE COUNTER DRUGS
The following are not QSEHRA eligible expenses:
Toiletries (including toothpaste) • Acne treatments • Lip balm (including Chapstick or Carmex) • Cosmetics (including face cream and moisturizer) • Suntan lotion • Medicated shampoos and soaps • Vitamins (daily) • Fiber supplements • Dietary supplements • Weight loss drugs for general well being • Herbs
This post was originally published in 2017 and has been updated with new information and insights for 2023.
I wrote this blog because I love helping people decode confusing insurance jargon and understand the fine print. I'm a licensed health insurance professional and specialize in simplifying health insurance for individuals and small businesses. My QSEHRA articles have been featured regularly on Accounting Today, Accounting Web, HRWeb, and other industry publications. I'm also a member of Take Command Health's client success team and a full-time mom. Learn more about me and connect with me on our about us page. Thanks!