October 31, 2011, 3:34 PM
Some Help Getting Reimbursed for OTC DrugsBy ANN CARRNS
New I.R.S. rules that went into effect this year, as part of the Affordable Care Act, made it harder for consumers to have non-prescription medicines reimbursed from health-care flexible spending accounts.
To be reimbursed for over-the-counter medicines, consumers now must obtain a prescription for the items—even though a prescription isn’t required to buy them in the first place.
The change has meant that customers whose employers provide them a dedicated debit card linked to their flexible spending accounts can’t use them to buy over-the-counter items, unless they get a prescription first. They then usually have to submit the prescription along with the receipt, to obtain the reimbursement. The rules apply to medicines like allergy pills, cough syrup, antibiotic ointment or ibuprofen (insulin, however, is exempt).
Flexible spending accounts let workers set aside pre-tax dollars from their paychecks to help pay for medical needs not covered by their health insurance. (The rules also apply to health savings accounts, another tax-savings vehicle).
In some cases, if the doctor knows the patient and has been treating him or her for a while, the physician may not mind providing the patient a written prescription for an over-the-counter drug, said Dr. Glen Stream, president of the American Academy of Family Physicians. In other cases, though, a doctor might want to see the patient in person before writing a prescription—which adds inconvenience and cost for the patient. “I think there is a lot of variability,” said Dr. Stream.
The whole thing has gotten so complicated that many employees appear to have given up seeking reimbursement for OTC medicines (possibly the whole point in the first place, since tax revenue increases for the government if people put less in their accounts in anticipation of not using that extra money for OTC medications).
Aon Hewitt, a large administrator of flexible spending accounts, has seen a 90 percent drop in requests for reimbursement for OTC items, says Craig Rosenberg, the firm’s national practice leader for health benefits administration. (The full impact won’t be entirely clear until after the end of the year, however, because some employees — especially those who don’t have dedicated FSA debit cards — save up their receipts and submit them all at once for reimbursement, and there’s usually a grace period after the end of the calendar year.)
FSAStore.com, an online store that sells only FSA-eligible items, has seen its sales of items affected by the eligibility change plummet because of the hassle of getting a prescription, said Maria Tenaglia, a spokeswoman for the FSAStore.com. (She said the site’s overall sales remain strong overall, however, since thousands of other OTC items, like blood pressure kits, still don’t require a prescription.)
To address the problem, FSAStore.com is offering a way to reduce the reimbursement hassle for patients. Customers with FSA debit cards can shop as usual at the online store, Ms. Tenaglia said. When they go to checkout, FSAStore.com will automatically flag items that now require a prescription.
If the customer provides their doctor’s contact information, FSAstore.com has teamed up with Wellpartner, a pharmacy services firm, to contact the physician’s office to obtain the prescription for processing. That way, the patient doesn’t have to deal with any paperwork. (A sample of the form sent to doctors’ offices notes that the patient is requesting a prescription for an over-the-counter item for FSA purposes). A request from Wellpartner, Ms. Tenaglia said in an e-mail, is no different from a request from a retail pharmacy: “They are experienced in communicating with physicians on pharmacy fulfillment.” She added that so far there have been “no issues” with the service.
If customers prefer, they can call the doctor themselves and have the prescription faxed or e-mailed. (The option to have FSAStore.com call your doctors isn’t available, though, if you lack a dedicated FSA debit card; in that case, you have to pay for the items, then submit a receipt and prescription manually to your claims administrator).
You can read more about the service here.
Have you tried to obtain reimbursement for OTC medicine? What was your experience?