09/30/2016

Seasonal Eligible Expenses – Is Over-the-Counter Medication Eligible?

Have you been suffering from the flu or a cold lately? Many people enrolled in pre-tax benefits such as Flexible Spending Accounts (FSAs) and Health Savings Accounts (HSAs) may be wondering if their funds can be used to pay for Over-the-Counter (OTC) medications to treat their cold and flu symptoms.

One of the changes that was brought about with healthcare reform was the removal of OTC medications as an eligible expense. While these types of expenses, including pain relievers, allergy medication, cold and flu medication and children’s medication, were previously allowed to be purchased using pre-tax dollars, effective January 1, 2011, these types of expenses require a prescription or note of medical necessity from a doctor in order to be reimbursed from pre-tax plans.

Participants who have a debit card available with their plan will be required to pay with another form of payment for their OTC medication. If the medication is prescribed by a doctor, the participant can submit the claim for reimbursement along with their prescription or note of medical necessity.

The changes to the OTC rules do not affect expenses such as bandages, contact lens solution, and medical equipment like thermometers.

A list of eligible expenses can be found on our website, as well as a list of eligible and ineligible OTC items.

For specific information regarding your plan and expenses that are eligible for reimbursement, please refer to your plan documents.

BusinessPlans, Inc. – myCafeteriaPlan does not intend to provide legal or tax advice and information contained in this article should not be interpreted as such. Regulations governing pretax plans are often open to interpretation and should be reviewed with your legal or tax advisor before making any decisions regarding your plan.

Posted 9/30/2016