New Preventive Care Expansions: Condoms and Contraceptives (2025 Guide)

For millions of Americans with High Deductible Health Plans (HDHPs), the path to affordable care often involves navigating a complex maze of deductibles before insurance kicks in. However, significant relief has arrived in the form of new IRS guidance issued in late 2024. In a move to modernize tax-favored health plans, the IRS has expanded the definition of “preventive care” to include over-the-counter (OTC) oral contraceptives and male condoms.

This change is pivotal. It means that HDHPs can now cover these essential items at 100%—with a $0 deductible—without jeopardizing the plan’s tax-qualified status. Furthermore, separate guidance confirms that condoms are now explicitly classified as eligible medical expenses for Health Savings Accounts (HSAs) and Flexible Spending Arrangements (FSAs).

As we approach the 2025 tax year, understanding these changes can help you maximize your tax savings and reduce your out-of-pocket healthcare costs. This guide details exactly what has changed under IRS Notice 2024-75 and Notice 2024-71, and how you can leverage these new rules.

Key Takeaways

• $0 Deductible for OTC Contraceptives: Under IRS Notice 2024-75, HDHPs may now cover OTC oral contraceptives (including emergency contraceptives like Plan B) and male condoms as “preventive care” before the deductible is met.
• No Prescription Required: Unlike previous rules that often required a prescription for OTC reimbursement, this new safe harbor applies to these specific items regardless of prescription status.
• Condoms are HSA Eligible: IRS Notice 2024-71 creates a safe harbor treating amounts paid for condoms as medical care under IRC § 213(d), making them eligible for reimbursement via HSA, FSA, and HRA funds.
• Retroactive Application: The guidance for HDHPs applies to plan years beginning on or after December 30, 2022, meaning some plans may apply these benefits retroactively.
• Gender Neutrality: Coverage for male condoms applies regardless of the gender of the covered individual who purchases them.

Detailed Breakdown: The New Preventive Care Rules

To understand the magnitude of this change, we must look at how HDHPs function. typically, an HDHP cannot provide benefits for any year until the minimum deductible for that year is satisfied. The sole exception to this rule is “preventive care.” If a plan covers non-preventive services before the deductible is met, it loses its HDHP status, and the account holder loses their eligibility to contribute to an HSA.

IRS Notice 2024-75 expands the list of what qualifies as preventive care, specifically targeting reproductive health and chronic condition management.

1. Over-the-Counter (OTC) Oral Contraceptives

Previously, while prescription birth control was mandated as preventive care under the Affordable Care Act (ACA), OTC options often fell into a gray area or required a prescription to be reimbursable tax-free. The new notice clarifies that HDHPs can provide benefits for OTC oral contraceptives, including emergency contraception, with no deductible. This aligns with the recent FDA approval of Opill, the first daily oral contraceptive available without a prescription.

2. Male Condoms

Perhaps the most distinct shift is the inclusion of male condoms. The IRS explicitly states that a plan will not fail to be an HDHP if it provides benefits for male condoms before the deductible is satisfied. Crucially, this applies regardless of whether the purchaser has a prescription and regardless of the gender of the covered individual purchasing them.

3. Additional Preventive Care Expansions

Beyond contraceptives, Notice 2024-75 also categorizes the following as preventive care:

• Breast Cancer Screenings: Expanded to include screenings (e.g., MRIs, ultrasounds) for individuals who have not been diagnosed with breast cancer.
• Continuous Glucose Monitors (CGMs): Now considered preventive care for individuals diagnosed with diabetes.
• Insulin Products: Selected insulin products are treated as preventive care regardless of whether they are prescribed to treat diabetes or prevent its exacerbation.

Condoms as a Qualified Medical Expense (Notice 2024-71)

While Notice 2024-75 deals with insurance plan design, IRS Notice 2024-71 addresses your spending accounts directly. It establishes that amounts paid for condoms are medical expenses under IRC § 213(d). This confirms that even if your insurance plan does not cover condoms (or if you prefer to buy them privately), you can use your HSA, FSA, or HRA funds to purchase them tax-free.

Comparison: 2024 vs. 2025 Rules

Item/Service	Previous Rule (Pre-Notice)	New Rule (Notice 2024-75 & 2024-71)
Male Condoms (Insurance)	Generally subject to deductible; rarely covered.	Can be covered 100% by HDHP before deductible (Preventive Care).
Male Condoms (HSA/FSA)	Ambiguous; often denied without prescription.	Explicitly eligible medical expense under § 213(d). No prescription needed.
OTC Birth Control (e.g., Opill)	Eligible for HSA/FSA (CARES Act), but subject to HDHP deductible.	Can be covered 100% by HDHP before deductible.
Breast Cancer Screening	Mammograms covered; supplemental screenings (MRI) often subject to deductible.	All types of screenings (MRI, Ultrasound) covered as preventive care before deductible.

Real-World Scenarios

To illustrate how these changes impact your wallet and tax planning, consider the following examples based on the 2025 tax limits.

Scenario 1: The “Opill” FSA Purchase

Situation: Sarah is enrolled in a General Purpose Health FSA for the 2025 tax year. She purchases a 3-month supply of Opill, an OTC daily oral contraceptive, for $50 at her local pharmacy.

Outcome: Under the new guidance, this is a qualified medical expense. Sarah can swipe her FSA debit card or submit a claim for the $50. Because this is now recognized as preventive care under Notice 2024-75, if her employer’s insurance plan adopts the new safe harbor, she might not even need to use her FSA funds—the insurance carrier could cover the cost at the pharmacy counter with $0 cost-sharing.

Scenario 2: John’s HSA Reimbursement for Condoms

Situation: John has an HSA and contributes the 2025 maximum of $4,300. He regularly purchases condoms at the grocery store. He keeps his receipts but has never submitted them, assuming they weren’t “medical” items.

Outcome: Thanks to IRS Notice 2024-71, John can now use his HSA funds to reimburse himself for these costs tax-free. He does not need a prescription. He simply needs to retain the receipts showing the purchase date and amount. This effectively gives him a tax deduction (via the HSA contribution) on these purchases.

Scenario 3: The Family Plan & Retroactive Claims

Situation: The Martinez family is on a family HDHP. Notice 2024-75 allows plans to apply these changes for plan years beginning on or after December 30, 2022. Their plan administrator decides to adopt the guidance retroactively to January 1, 2024.

Outcome: Mrs. Martinez purchased emergency contraception in 2024 and paid out-of-pocket because she hadn’t met the family deductible of $3,200 (the 2024 limit). Because her plan adopted the rule retroactively, she can resubmit that claim to her insurance provider for reimbursement, as it should have been covered at 100% as preventive care.

Scenario 4: Diabetes Management

Situation: Robert has been diagnosed with diabetes. His doctor recommends a Continuous Glucose Monitor (CGM) to better manage his insulin levels. In previous years, he had to pay for the CGM until he hit his deductible.

Outcome: Under Notice 2024-75, the CGM is now treated as preventive care. His HDHP can cover the cost of the device immediately, without Robert needing to pay the first $1,650 (the 2025 self-only minimum deductible) out of pocket.

Scenario 5: Gender Neutrality in Action

Situation: Lisa, who is covered under her own self-only HDHP, purchases male condoms at a pharmacy for use with her partner.

Outcome: The IRS guidance is gender-neutral regarding the purchase of condoms. Lisa can use her HSA funds to pay for them, or if her HDHP has adopted the preventive care expansion, the plan may cover the cost directly. The fact that she is female does not disqualify the purchase as a medical expense or preventive care item.

2025 Tax Planning Data

When planning your medical expenses for the year, it is vital to keep the 2025 inflation-adjusted limits in mind. These figures determine your maximum tax savings.

Category	Self-Only Coverage	Family Coverage
HSA Contribution Limit	$4,300	$8,550
HSA Catch-Up (Age 55+)	$1,000	$1,000
HDHP Minimum Deductible	$1,650	$3,300
HDHP Max Out-of-Pocket	$8,300	$16,600
Health FSA Limit	$3,300 (Max Carryover: $660)

Source: Rev. Proc. 2024-25 (HSA/HDHP) and Rev. Proc. 2024-40 (FSA).

Common Pitfalls & Mistakes

While these expansions are excellent news for taxpayers, there are traps for the unwary. Avoid these common mistakes to ensure you stay compliant.

1. Assuming Automatic Plan Adoption

The Pitfall: The IRS permits HDHPs to cover these items with $0 deductible, but it does not require them to do so immediately (unlike ACA-mandated preventive services).
The Fix: Check your specific plan document or Summary of Benefits and Coverage (SBC) for 2025. Do not assume your insurance card will work for $0 copay condoms at the pharmacy until you verify your plan has adopted the Notice 2024-75 safe harbor.

2. Discarding Receipts for “Small” Items

The Pitfall: Because condoms and OTC contraceptives are relatively inexpensive per purchase, many people throw away the receipts.
The Fix: If you plan to reimburse yourself from an HSA, you must have a paper trail. The IRS requires records that show the name of the payee, the date, and the amount. A credit card statement is generally insufficient; you need the itemized receipt.

3. Confusing “Medical Care” with “Preventive Care”

The Pitfall: Thinking that because something is tax-deductible (Medical Care), it is automatically free under insurance (Preventive Care).
The Fix: Remember the distinction. Notice 2024-71 makes condoms tax-deductible (HSA/FSA eligible). Notice 2024-75 allows insurance to make them free (Preventive Care). Even if your insurance doesn’t make them free, you can still use your HSA to pay for them tax-free.

Frequently Asked Questions (FAQ)

Can I buy condoms with my HSA card now?

Yes. Under IRS Notice 2024-71, amounts paid for condoms are considered medical care expenses under IRC § 213(d). You can use your HSA, FSA, or HRA debit card to purchase them, or pay out-of-pocket and reimburse yourself later.

Do I need a prescription for OTC birth control to be tax-deductible?

No. The CARES Act (2020) removed the prescription requirement for OTC drugs to be HSA/FSA eligible. Notice 2024-75 further clarifies that HDHPs can cover OTC oral contraceptives as preventive care without a prescription.

Does this apply to the Opill birth control pill?

Yes. Opill is an OTC oral contraceptive. Under the new guidance, it qualifies as a preventive care expense that HDHPs can cover without a deductible, and it is also an eligible medical expense for HSA/FSA funds.

When do these changes take effect?

The safe harbor for HDHP preventive care (Notice 2024-75) is effective for plan years beginning on or after December 30, 2022. The safe harbor for treating condoms as medical expenses (Notice 2024-71) applies immediately.

Conclusion

The IRS’s recent guidance represents a significant modernization of tax-favored healthcare rules. By recognizing OTC oral contraceptives and condoms as preventive care, the IRS has removed financial barriers to reproductive health for millions of HDHP participants. For the 2025 tax year, this means greater flexibility in how you use your Health Savings Account and potentially lower out-of-pocket costs at the pharmacy counter.

As always, tax laws are subject to individual circumstances. While the guidance is clear, the implementation depends on your specific insurance carrier. Review your 2025 plan documents carefully, keep your receipts for all OTC reproductive health purchases, and take full advantage of these new “condoms HSA eligible” and contraceptive rules to optimize your financial health.