NEWS
NEW HEALTH CARE BILL IMPACTS REIMBURSEMENT OF OVER-THE-COUNTER (OTC) MEDICINES
Updated April 2010
The new federal health care reform law, now being referred to as the Patient Protection and Affordable Care Act of 2010 (PPACA), has changed the rules for over the counter medicines and drugs having a potential impact on health flexible spending accounts (FSA), health savings accounts (HSA) and healthcare reimbursement arrangements (HRA). The following information is based on our current understanding of the law through informal guidance obtained directly from the Internal Revenue Service and consultation with other professionals. We will update you as additional information becomes available.
What is the change?
OTC medications such as antacids, allergy medicines, pain relievers and cold medicines, currently reimbursable under your plan will require a prescription from a health care provider to qualify for reimbursement starting with all purchases beginning January 1, 2011.
Does this impact me now?
Since the change occurs on January 1, 2011, this change will be in effect for all plan years starting February 1, 2010. Participants should consider the change as they plan their election for the upcoming plan year. In addition, participants should obtain any prescription needed for OTC medications at their next scheduled visit to their health care provider(s).
What is required for OTC medications to be reimbursed?
HFS Benefits has made it easy for participants by updating our letter of medical recommendation form. There are now two sections on the form, OTC Medications and Dual Purpose items. No diagnosis or explanation from the provider is required for OTC Medications. Once completed, participants simply need to submit it to HFS Benefits along with a signed claim form and the sales receipt(s) for reimbursement. Participants can use the same form to submit a letter of medical recommendation (second section) for certain dual purpose' items (e.g., massage therapy, weight loss programs, nutritionist expenses, etc.). Unless otherwise noted by the participant’s physician, the form will expire after 1 year.
What about OTC items that are not medications?
This change does not impact OTC items that such as bandages that are currently reimbursable but are not medications.
How does this affect the use of my HFS Benefits debit card?
If your plan currently uses the HFS Benefits debit card, participants should be familiar with the inventory control system which allows reimbursement for pre-approved items without further substantiation. Starting in January 2011, OTC medications will be removed from the approved list of reimbursable items. Participants will be required to use another form of payment and follow the procedures above to be reimbursed.