You might be able to repay the distribution to the HSA if the HSA custodian will accept a "return of mistaken distribution." However, the HSA custodian is not required to accept such a repayment. A return of mistake distribution is not a rollover, so it is not subject to any rollover limitations. The HSA custodian is supposed to correct the Form 1099-SA to remove the repaid amount from the gross amount reported, but few HSA custodian seem to comply with this requirement.
If you can't do a return mistaken distribution and you can't apply the amount distributed to someone else's qualified medical expenses, you'll have to report the distribution as taxable and, if you were under age 65 at the time, subject to a 20% extra tax.
