REMINDER NO LONGER REIMBURSED FROM FLEXIBLE SPENDING ACCOUNTS
Effective January 1, 2011, over-the-counter (OTC) medications are no longer eligible for reimbursement from Flexible Spending Accounts (FSA) unless the patient has a prescription for the OTC item. This became applicable for all OTC purchases made after January 1, 2011, even if the money being spent was a carryover balance from 2010. The Internal Revenue Service (IRS) had previously ruled that such purchases could not be made with FSA cards at the point of sale (even if the patient had a prescription) because the online system could not verify that an actual prescription existed.
NOTE: THIS NEW IRS RULING DOES NOT APPLY TO INSULIN PRODUCTS.
To see the actual release, click here: www.irs.gov/pub/irs-drop/n-11-05.pdf
OTC MEDICATIONS (WITHOUT A PRESCRIPTION)