FSAs and HSAs

CHPA supports legislation that will reinstate over-the-counter (OTC) medicine eligibility in tax-preferred accounts.

OTCD InfographicFlexible spending arrangements (FSAs), health savings accounts (HSAs), and other tax-preferred accounts are valuable programs allowing consumers to save money by setting aside pre-tax dollars in order to pay for health-related expenses. For years, consumers have been able to use these accounts to pay for over-the-counter (OTC) medicines, a first line of defense for their families’ healthcare needs. In fact, OTC medicines save consumers and society $102 billion annually through avoided doctor visits, increased work productivity, and other cost advantages.

Unfortunately, in 2011, Congress removed OTC medicine eligibility from tax-preferred accounts unless the medicine is purchased with a doctor’s prescription- an unnecessary burden on consumers and healthcare professionals.

In March 2011, CHPA joined a group of concerned stakeholders including physicians, insurers, pharmacies, pharmacists, pharmacy benefit managers, patients, consumers, retailers, small businesses, and large employers called the “Health Choices Coalition” to advocate for the restoration of OTC eligibility in tax-preferred accounts.

In early 2019, bipartisan bills known as the Restoring Access to Medication Act (RAMA) were reintroduced in the House and Senate to repeal the OTC provision of PPACA. In the House, longtime RAMA supporter Rep. Ron Kind (D-WI) reintroduced H.R. 1922 with Reps. Grace Meng (D-NY), Jackie Walorski (R-IN), and Darin LaHood (R-IL) as new partners. H.R. 1922 also includes language that would expand HSA/FSA eligibility to feminine hygiene products. On the Senate side, Senator Pat Roberts (R-KS) who has also long supported the restoration of the OTC benefit, reintroduced S. 1089 with Sens. Johnny Isakson (R-GA), Angus King (I-ME) and Joe Manchin (D-WV).

CHPA and the Health Choices Coalition continue to seek every opportunity to work with Congress to restore this important healthcare provision for consumers.