Healthcare Spending Account

A Health Care Spending Account, or Healthcare Spending Account is a type of flexible employee benefit program in Canada that aims to provide more flexibility than a traditional health plan. As a supplemental program, it covers items that are not normally part of the traditional plan. Generally these plans include a fixed amount per employee available to be claimed, which makes budgeting for them easier for employers. Expenses that can be claimed against an HCSA are regulated by the Canada Revenue Agency.
HSAs can be utilized to supplement insured PHSP, or implemented as "stand-alone" plans instead of insured PHSP. Private PHSP may form part of a Health and Welfare Trust or flexible employee benefit program.

Eligible expenses

Eligible expenses are medical expenses which would otherwise qualify as medical expenses within Section 118.2 of the Income Tax Act, and as interpreted by the Canada Revenue Agency in Income Tax Folio S1F1C1 "Medical Expenses". These are the same medical expenses as allowed under the Medical Expense Tax Credit and can be obtained from the CRA website.
HCSA covers expenses connected with health, vision and dental care for employees, their spouses or any dependents qualified by the Canada Revenue Agency. Expenses related to cosmetic surgery, hair removal/regeneration, non-prescription lenses or over-the-counter drugs without an actual prescription signed by registered medical staff, etc. cannot be paid using a Health Care Spending Account.