Retail News Breaks Archives
NACDS helps retailers convey upcoming FSA changes
December 10th, 2010
ALEXANDRIA, Va. – The National Association of Chain Drug Stores has devised materials that pharmacy retailers can use to inform customers about new limits going into effect next year on over-the-counter medicines in flexible spending accounts (FSAs).
NACDS on Thursday posted drafts of a handout and signage to its web site. The materials explain how the health care reform law has led to new Internal Revenue Service restrictions on reimbursements from pretax health care accounts for purchases of OTC medications, noting that more than 15,000 products will be affected.
Starting Jan. 1, purchases of those OTC medicines will only be eligible for reimbursement from FSAs, health savings accounts (HSAs), medical savings accounts (MSAs) and health reimbursement accounts (HRAs) if they are bought with a prescription.
"Given new Internal Revenue Service restrictions on the use of flexible spending accounts for over-the-counter medication purchases, NACDS has prepared draft materials that may be useful for retailers in communicating with consumers about these changes," NACDS said in a statement about the materials.
The draft pamphlet lists 19 categories of OTC remedies that will be subject to the new restrictions. It also urges consumers to contact their health insurer or employer for more information on the impact of the new regulations.
"Many OTC items such as acid blockers, allergy medications, pain relievers, stomach remedies and others will now require a prescription before they are eligible for reimbursement to an FSA or HSA," the draft signage reads. "The new restrictions will impact customers seeking reimbursement from a FSA or HSA account but should not impact more traditional forms of payment."
Late last month, NACDS was part of a coalition representing retail pharmacies and makers of OTC drugs that called on Congress to nullify what they dubbed as the "cough and cold tax," referring to the provision of the Patient Protection and Affordable Care Act that would remove nonprescription medications from the list of eligible medical expenses for pretax health care accounts.
In a letter to House and Senate leaders, NACDS and the Consumer Healthcare Products Association, National Grocers Association, Food Marketing Institute, American Pharmacists Association and the National Community Pharmacists Association urged lawmakers to repeal or delay the provision, saying it would impact 35 million Americans.