When you participate in a Flexible Spending Account (FSA), you can contribute pre-tax funds for use on hundreds of eligible expenses. Recently, you gained even more flexibility in your ability to save when the CARES Act was signed into law.
This new legislation expanded the list of expenses that are considered eligible by including popular over-the-counter products, which consumers can now purchase with their FSA without a prescription. This change was included in the Cares Act that was signed into law on March 27, 2020 and allows reimbursement of this expanded list back to January 1, 2020 and allows over 20,000 new items as eligible moving forward. This is great news for consumers since the average American shops for over the-counter medications 26 times each year.
Here are five of the most common expense categories that are now eligible to use FSA funds without a prescription.
- Pain Relief Medications Headaches. – Over-the-counter pain and headache medications are now among the eligible expenses available from an FSA.
- Cold and Flu Products – Over-the-counter medicines taken to cope with a severe cough or congestion are now eligible expenses.
- Allergy Products – Those who have allergies can now find relief with their FSA funds in the form of over-the counter antihistamines and decongestants.
- Heartburn Medications – Over-the-counter Heartburn medications are now FSA eligible without a prescription.
- Menstrual Products – This entirely new product category is now FSA eligible! Eligible products include tampons, pads, and menstrual sponges.
Expect a delay in being able to use your FSA Debit Card to pay for these newly eligible product purchases.
AleraPay is ready, but each merchant must program over 20,000 new products as FSA eligible. The individual merchants are completely in control of their process and as a result your FSA Debit Card may work at some merchants, but not others.
We expect most merchants will complete the programming process by the end of June. In the meantime, you can submit a receipt of your purchase of these items, by uploading the receipt on the AleraPay App or submitting your receipt with a paper claim.
Remember, when using your FSA Debit Card always keep the receipt in case it is needed to confirm that your purchase is eligible for reimbursement from your FSA.
Not sure if an expense is eligible? For a complete up-to-date list of FSA Eligible Products & Services, visit FSAStore.com, select Tools, then Eligibility List, or use the AleraPay App to access the FSAStore or use the App to Scan the item’s bar code. s the merchants complete implementation.
In the meantime, eligible OTC items are eligible for FSA manual claims processing, your employees should be encouraged to use the AleraPay App to submit OTC claims by taking a picture of the relevant merchant receipt and downloading it to their claim submission.
We are extremely excited about this change and the opportunity to provide affordable access to OTC items via tax advantaged benefits. We will continue to provide updates as more information.