IRS’ updated FSA rules regarding OTC medicines draw response
WASHINGTON The Internal Revenue Service earlier this month issued guidance reflecting statutory changes regarding the use of certain tax-favored arrangements, such as flexible spending arrangements, to pay for over-the-counter medicines and drugs.
The Affordable Care Act, enacted in March, established a new uniform standard that, effective Jan. 1, 2011, applies to FSAs and health reimbursement arrangements. Under the new standard, the cost of an OTC medicine or drug cannot be reimbursed from the account unless a prescription is obtained. The change does not affect insulin, even if purchased without a prescription, or such other healthcare expenses as medical devices, eye glasses, contact lenses, co-pays and deductibles, the agency stated. The new standard applies only to purchases made on or after Jan. 1, 2011, so claims for medicines or drugs purchased without a prescription in 2010 still can be reimbursed in 2011 if allowed by the employer’s plan.
WageWorks, a provider of consumer-directed benefits solutions, including FSAs, this past summer advocated an extension of that Jan. 1 deadline, arguing that all parties — consumers, retailers and third-party administrators — needed additional time to react to the changes. “This restriction will hurt millions of consumers who rely on their FSAs to manage their out-of-pocket healthcare costs and pay for necessary over-the-counter therapies,” stated Joe Jackson, CEO of WageWorks. “If Congress is intent on putting this provision into effect, they should at least push back the deadline so that consumers — and especially retailers — are ready for the transition.”
Jody Dietel, president and chair of the Special Interest Group for Inventory Information Approval System Standard said, “Without clarification on the type of permission needed for FSA reimbursement for OTC drugs, consumers, retailers and third-party administrators will be confused and unlikely to fully comply with the new regulations by the start of new year. Meanwhile, we’re likely to see doctor’s offices overwhelmed with patients seeking prescriptions to use their spending accounts for Claritin, Zyrtec and other OTC items,” she said. “A delay in implementation will provide time for all parties to be better educated on the issue and prepared to comply with the new rules.”
SGIS maintains an electronic list of FSA-eligible products used by most retailers in the country.
The new regulations, even the recent guidance issued by the IRS, leave many questions unanswered, according to a report on The Bulletin published last week. Will physician prescriptions be required to specify a number of pills with the prescription, or can consumers buy bulk-sized containers of pain relievers? And if pharmacies must process prescriptions for aspirin or cold medication, will they seek some dispensing fee for their time?
“We’re concerned that there will be a lot of confusion out there,” Jeff Beadle, CEO of SIGIS, told The Bulletin. “Someone is buying Tylenol in December, and they can’t now buy Tylenol in January unless they go to their doctor and get a prescription first.”
The report suggested retailers will face an additional challenge — when to update the list of eligible products under FSA plans because many FSA plans do not run on a calendar year.
Q&A: Eyelid clean-up
At the ECRM Health Care EPPS conference, OcuSoft presented a pair of new offerings. Drug Store News caught up with OcuSoft president and CEO Cynthia Barratt for a rundown on eye care today.
Drug Store News: What is the opportunity within eyelid cleansers?
Cynthia Barratt: Based on recent SymphonyIRI Group data, the eye care accessories category is a growing $49 million market with $10 million attributed to the sale of eyelid cleansers.… Doctors are seeing more and more patients with lid disease and other related ocular conditions, reaffirming the need for products that will help prevent and alleviate symptoms.
DSN: OcuSoft recently introduced a prescription kit that includes two eyelid cleansers, how will that complement the OTC business?
Barratt: OcuSoft’s prescription-only Alodox convenience kit contains a low-dose doxycycline (20 mg) to control inflammation, OcuSoft scrub plus pre-moistened pads to remove harmful bacteria, OcuSoft lid scrub original foam for daily cleansing and Tranquileyes moist heat therapy goggles for added relief. The kit is recommended for patients with moderate to severe cases of lid disease, and because these conditions usually are chronic, patients are advised to follow the entire one- to three-month course of therapy or as directed by their doctor. As a result of the awareness and demand created by the Alodox convenience kit, sales of OTC eyelid cleansers will increase accordingly.
DSN: What are the benefits of OcuSoft’s new TearsAgain?
Barratt: Tears Again advanced liposome spray was introduced as a companion product to OcuSoft lid scrub eyelid cleansers.… OcuSoft lid scrub alleviates [eye irritation] by removing oil and debris from the eyelids while Tears Again advanced liposome spray provides added relief throughout the day with a soothing mist.
RCEC honors NPs during first Nat’l Clinic Week
FORT LAUDERDALE, Fla. —This year’s third annual Retail Clinician Education Congress, which was held at the whimsically themed Swan and Dolphin Resort located at the doorstep of Walt Disney’s Epcot, was especially “magical” as it attracted nearly 500 nurse practitioners and was held during the first official National Convenient Care Clinic Week.
“The reality is that we need accessible and affordable options for primary healthcare services, and all of you provide that and are part of a larger healthcare system,” Tine Hansen-Turton, executive director of the Convenient Care Association, told attendees.
Retail Clinician magazine, in conjunction with the Convenient Care Association, hosted the event Aug. 2 to 4. It convened in line with the start of National Convenient Care Clinic Week, which became official when Sens. Dan Inouye, D-Hawaii, and Thad Cochran, D-Miss., introduced Senate resolution 585.
Kicking off the conference, Lt. Col. Corina Barrow of the Army Nurse Corps and currently the Nurse Corps Detailee for Inouye, welcomed attendees and read from the resolution presented on the Senate floor by Inouye on July 22: “Mr. President, today I rise to recognize all of the providers who work in retail-based convenient care clinics and the resolution to designate Aug. 2 to Aug. 8, 2010, as National Convenient Care Clinic Week. National Convenient Care Clinic Week will provide a national platform from which to promote the pivotal services offered by the more than 1,100 retail-based convenient care clinics in the United States. Today, thousands of nurse practitioners, physician assistants and physicians provide care in convenient care clinics at a time when Americans are more and more challenged by the inaccessibility and high cost of health care.”
The three-day event included a panel discussion on the “Past, Present and Future of Convenient Care”—comprised of panelists Ken Berndt, director of Bellin FastCare; Web Golinkin, president and CEO of RediClinic; Sandy Ryan, chief nurse practitioner officer of Take Care Health Systems; Andrew Sussman, president of MinuteClinic; and Cynthia Graff, president and CEO of Lindora—as well as a keynote presentation on “The Future of Nursing” by Susan Hassmiller, senior adviser for nursing and director of the Robert Wood Johnson Foundation Initiative on the Future of Nursing at the Institute of Medicine.
Nurse practitioners also participated in more than 14 live hours of continuing education, with topics ranging from the management of diabetes to identifying pediatric emergencies to respiratory conditions and treatments. The conference also featured an exhibit hall area where 25 different supplier companies demonstrated products for attendees.