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How to Earn Credit Card Points on HSA/FSA Expenses (And Pay Yourself Back Tax-Free)
July 1, 2025
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If you have a Health Savings Account (HSA) or Flexible Spending Account (FSA), you're already saving money on medical expenses with tax-free dollars. But there's a simple strategy that lets you stack even more value on top — and it takes less than five minutes to set up.
Here's the approach: pay for your HSA/FSA-eligible expenses with a rewards credit card, then submit the receipts for reimbursement. You'll earn travel points or cash back on every purchase, and pay yourself back with tax-free money. It's completely legal, takes no extra effort, and most people have no idea it exists.
How the HSA/FSA Credit Card Strategy Works
Most people pay for eligible medical expenses directly from their HSA or FSA debit card and move on. That's leaving real money on the table.
Here's what the method looks like in practice:
- Make an eligible purchase — such as prescriptions, doctor's office copays, dental visits, glasses, contact lenses, medical equipment, and thousands of other qualified expenses.
- Pay with your rewards credit card instead of your HSA/FSA debit card.
- Save the receipt.
- Submit the receipt for reimbursement through your HSA or FSA provider's portal.
- Get paid back in tax-free dollars while keeping the points you earned.
That's it. You've essentially earned free travel rewards on a purchase you were going to make anyway, funded by pre-tax income.
Why This Works (And Why It's Completely Above Board)
HSAs and FSAs don't require you to use a specific payment method for eligible expenses. They just require that the expense itself qualifies. As long as you have documentation (a receipt or Explanation of Benefits), you can reimburse yourself for any out-of-pocket payment, including one made on a credit card.
The IRS doesn't care how you paid. It cares what you paid for.
This means you get the full tax benefit of your HSA or FSA and the rewards from your credit card on the same transaction.
How Much Can You Actually Earn?
The numbers add up faster than you'd think. The average American family spends around $5,000–$6,000 per year on out-of-pocket healthcare costs. If you're earning 2x–5x points on those purchases with the right card, that could translate to:
- $100–$300+ in travel rewards per year just from medical spending
- Free flights or hotel nights when combined with a strong welcome bonus
- Accelerated status toward airline or hotel loyalty tiers
And because you're reimbursing yourself with pre-tax HSA/FSA dollars, your effective cost on those purchases is lower than if you'd paid out of pocket with post-tax money.
Best Credit Cards for This Strategy
Not all rewards cards are created equal. Here are the types of cards worth pairing with this approach:
- Flat-rate cards (like the Capital One Venture Rewards Credit Card or Citi Double Cash® Card) earn consistently on every purchase, with no category restrictions
- Cards with bonus categories for medical: some cards offer elevated rewards at pharmacies or for healthcare spending, like the Chase Freedom Unlimited®, the AARP® Essential Rewards Mastercard®, and the Bank of America® Customized Cash Rewards Credit Card
- Cards with strong welcome bonuses: if you have a large medical expense coming up, timing it with a new card's minimum spend requirement can unlock a bonus worth hundreds of dollars in travel
The key is to pay your balance in full each month. This approach only works if you're not paying interest. Carrying a balance will quickly wipe out any rewards earned.
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What Counts as an HSA/FSA-Eligible Expense?
The list is longer than most people realize. Common eligible purchases include:
- Prescription medications
- Doctor, dentist, and vision office visits
- Contact lenses and eyeglasses
- Mental health therapy
- Chiropractic care
- Medical equipment (blood pressure monitors, glucose meters, etc.)
- Feminine hygiene products
- Sunscreen (SPF 15+)
- Over-the-counter medications (no prescription required since 2020)
Always verify eligibility with your plan provider before assuming a purchase qualifies. Rules can vary between HSA and FSA accounts.
One Important Note on HSA vs. FSA
Both accounts work with this strategy, but there's a key difference worth knowing.
HSAs have no deadline for reimbursement. You can pay out of pocket today, let the money in your HSA grow tax-free for years, and reimburse yourself later. This makes the HSA version of this approach even more powerful — your invested HSA funds keep compounding while you rack up credit card points.
FSAs typically have a use-it-or-lose-it rule by year's end (with some grace periods depending on your plan). Don't let eligible expenses sit unreimbursed if you're running up against a deadline.
How to Make This Easy
The biggest friction point with this method is keeping track of receipts. A few ways to simplify it:
- Take a photo of every receipt immediately after purchase and store them in a dedicated folder
- Use your HSA/FSA provider's mobile app to submit reimbursements on the spot
- Check if your provider supports automatic reimbursement via Explanation of Benefits (EOB) from your insurer
The Bottom Line
Your HSA and FSA are already powerful tax-advantaged tools. But by routing eligible purchases through a rewards credit card first, you unlock a second layer of value that most people never tap into. It costs nothing extra, takes minimal effort, and turns everyday healthcare spending into travel rewards.
Want to make sure you're always using the best card for every purchase, including medical spending? Kudos automatically recommends the highest-earning card in your wallet at checkout, so you never miss out on rewards and free travel.
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Editorial Disclosure: Opinions expressed here are those of Kudos alone, not those of any bank, credit card issuer, hotel, airline, or other entity. This content has not been reviewed, approved or otherwise endorsed by any of the entities included within the post.
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