Have you ever looked down at your receipt from the drugstore and noticed a little “H” or “F” next to something you purchased? Those are actually health codes that tell you which items on your receipt are qualifying medical expenses.
These codes are a quick way for you to see which items on your receipt can be paid for through your health savings account (HSA), your flexible spending account (FSA), or are eligible for reimbursement through your health reimbursement arrangement (HRA).
In this article, we’ll help you understand how to read the codes on your receipts, where you can find them, and how they can help you more easily determine which items are HSA-, FSA-, and HRA-eligible.
Why are there codes on my receipts?
Through an IIAS, a store’s inventory and point-of-sale system needs to have the ability to verify that the items being purchased with a HSA, FSA, or HRA debit card are eligible medical expenses, as defined by IRS Publication 502.
Here are just a few common IIAS-compliant merchants that have health codes on their receipts:
- CVS Pharmacy
- Rite Aid
- Sam’s Club
What do these health codes look like?
The health codes will look a little different depending on where you’re shopping. For example, Walmart puts an "H" at the end of the barcode for each item to indicate that it’s HSA-approved, whereas CVS Pharmacy flags FSA-eligible items on every receipt with an "F."
Other stores, such as Walgreens, make it a little easier by putting a unique FSA/HSA total on the bottom of the receipt in addition to marking each individual item with its own code. That way, if you purchase non-eligible items, such as groceries or cosmetics, you can see the exact total of only the items that qualify as medical expenses without having to purchase those items separately.
Do I have to use a health debit card to see these codes on my receipt?
While only stores that accept health debit cards are required to print these health codes, all customers will see them on their receipt whether or not they made their purchase with a health debit card.
In addition, just because something is marked on your receipt as a qualified medical expense, you don’t have to use your HSA, FSA, or HRA to pay for it. The code simply shows you which items are eligible, but you’re welcome to pay for them any way you choose.
Why should I care about these codes?
Paying attention to these health codes is especially important for employees with an HRA. That’s because in order to get reimbursed through an HRA, you need to submit a receipt showing that what you’re requesting reimbursement for is a qualified medical expense.
Having these codes on your receipt is an easy way for both you and your HRA administrator to quickly see that you’ve made a qualifying purchase and will be able to get reimbursed for that item. You may even notice a “H” or “F” next to something you didn’t even know was eligible for reimbursement!
In addition, if you have a receipt that totals all of your health-related expenses for you, it’s even easier to purchase your regular groceries alongside the items you want to get reimbursed through your HRA, because the codes will divide up the health expenses and the non-health expenses for you.
Purchasing items through a health account or reimbursement plan is a great way to save on your qualifying medical expenses big and small and enjoy the potential tax advantages that come with it. By understanding the health codes on your receipts, it’s that much easier to find the items that are eligible, allowing you and your family to get reimbursed that much faster.