Over-The-Counter Items: FSA Eligibility

Over-The-Counter Items: eligible with a Flexible Savings Account (FSA)
Over-the-counter medicine is eligible for reimbursement with a flexible spending account (FSA), health savings account (HSA), health reimbursement arrangement (HRA) and limited care flexible spending account (LCFSA). Over-the-counter (OTC) medicine is not eligible for reimbursement with a dependent care flexible spending account (DCFSA).

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What are over-the-counter items?

As a result of the passage of the Patient Protection and Affordable Care Act (PPACA), as of January 1, 2011, a new set of uniform standards were put into place regarding the reimbursement of medical expenses. To reimburse the cost of over-the-counter medicines and drugs under FSAs, HSAs and other consumer spending accounts, account holders must submit a prescription for each product. This does not apply to the reimbursement of the cost of insulin, but common everyday products like pain relief medications, cold & flu products and many more will require a prescription for full reimbursement.

A 2012 study commissioned by the Consumer Healthcare Products Assocation found that the use of OTC medicine would save the U.S. healthcare system $102 billion per year, as much of the savings comes from the utilization of low-cost medicines as opposed to drugs that must be filled by a pharmacist. However, not every OTC product is covered under this distinction, as products like bandages, first aid supplies, diagnostic products and more do not require a prescription. Only over-the-counter items that contain a medical ingredient require a prescription for reimbursement, so this is a helpful piece of information to keep in mind when purchasing OTC products with a consumer-directed healthcare account.

How does the prescription process work?

The reimbursement of OTC medicines begins by requesting prescriptions for medications during a routine doctor's appointment, or by following the Prescription Process found on FSAstore.com and HSAstore.com. Each of our products that require a prescription for reimbursement are marked with a blue "Rx" symbol, as well as red check marks that mark the products as free to purchase without a prescription.