Posted 3 years ago - by

CARES Act increases the number of FSA eligible products

The recently passed CARES (Coronavirus Aid, Relief, and Economic Security) act offers some important updates for pre-tax health care plans (FSA’s, HSA’s, and HRA’s). In addition to direct payments to many eligible Americans, this act also permanently reinstates coverage of OTC (over the counter) drugs and medicines as eligible for reimbursement for pre-tax plans, without need for a prescription.

What this means:

Prescriptions will no longer be required for over-the-counter drugs, including items like Tylenol, Claritin, Tamiflu, etc. when purchased with an FSA, HSA, or HRA. This will be retro-active to January 1, 2020. Prescriptions have been required since 2011,causing unnecessary trips to the doctor, or payment with after tax dollars.

The act also allows for menstrual care products to be eligible as well. The bill indicates that this addition means a “tampon, pad, liner, cup, sponge, or similar product used by individuals with respect to menstruation” will qualify.

Payroll Systems and PS Administrators are able to process claims for OTC products immediately. We are also waiting for an updated list of eligible products and implementation of this list by participating merchants. In the meantime,debit card acceptance on OTC purchases may be inconsistent depending on the merchant and whether or not they have updated their systems.

For more information, contact us.

To make pre-tax purchases online with your Amazon Prime account, visit Health Shopper.

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This article provides general information and shouldn’t be construed as legal or HR advice. Since employment laws may change over time and can vary by location and industry, please consult a lawyer or HR expert for advice specific to your business. You can also contact Payroll Systems to inquire about our HR support services.