Last January, due to the new PPACA rules, people who wanted to use their Health Savings Accounts (HSA) or Flexible Spending Accounts (FSA) to purchase over the counter medication had to get a prescription from their physician. Without a prescription, the over the counter medications did not qualify as a medical expense for HSA or FSA. Well, things may be changing – for the better.
Last week, Congress introduced bipartisan legislation to remove restrictions on tax-exempt health spending accounts – a revenue-raising provision of the Affordable Care Act that was estimated to garner $5 billion over 10 years. The bill would end a provision that since January has required a prescription for buying over-the-counter medicines with medical savings accounts, such as Flexible Spending Accounts and Health Savings Accounts.
The language was originally added as a way to keep the Affordable Care Act’s costs down by reducing unnecessary drug purchases. However, the provision appears to have had the opposite effect of increasing costs, as many people are scheduling doctor visits for the sole purpose of obtaining prescriptions for over-the-counter medications. The proposed legislation would restore the ability of people participating in a medical savings account to use funds from those accounts to purchase over-the-counter medications without a prescription.