Eligible healthcare expenses

Learn what type of over-the-counter products are eligible for reimbursement, what quantities are permitted, and which medicines require a doctor’s prescription.

Reimbursement requirements

What’s eligible?

Over-the-Counter (OTC) products used primarily for a medical purpose are eligible for reimbursement from your Healthcare FSA. OTC products that are directed at improving a person’s appearance or general health are not considered expenses for medical care and, therefore, not eligible for reimbursement. Please review the eligible expenses summary document for more details.

What’s not allowed?

Stockpiling is not permitted. Only reasonable quantities of the same OTC product that can be used during the plan year can be reimbursed. One to three packages of the same OTC product in a single calendar month is considered reasonable unless a greater quantity has been specifically recommended or prescribed for a medical condition.

Ask your doctor

As illustrated below, “OTC Medicines & Drugs” will require a doctor’s prescription (if incurred before January 1, 2020) regardless of the number of packages, and “Dual Purpose OTC Products” will always require either a doctor’s prescription (if incurred before January 1, 2020) or a Letter of Medical Necessity (LOMN) regardless of the number of packages. If a quantity of more than 3 packages a month is required of all other OTC products, a prescription or LOMN is required.

 

OTC Medicines & Drugs

On March 27, 2020, the CARES Act was signed into law, which among other things, no longer required OTC medicines and drugs to be prescribed by a physician in order to qualify for reimbursement under a health FSA as of January 1, 2020.  Prior to this change, Insulin was the only exception to an ACA provision requiring such OTC medications and drugs to be prescribed in order to be considered eligible for reimbursement.  The following categories of items will require a doctor’s prescription (if incurred before 2020):

  • Acid Controllers
  • Allergy & Sinus
  • Antibiotic Products
  • Anti-Diarrheal
  • Anti-Gas
  • Anti-Itch &Insect Bite
  • Anti-parasitic Treatments
  • Baby Rash Ointments/Creams
  • Cold Sore Remedies
  • Cough, Cold, & Flu Remedies
  • Digestive Aids
  • Feminine Anti-Fungal/Anti-Itch
  • Hemorrhoid Preparations/Suppositories/Cream
  • Laxatives
  • Motion Sickness
  • Pain Relief
  • Respiratory Treatments
  • Sleep Aids & Sedatives
  • Stomach Remedies

OTC products that are not medicines or drugs are reimbursable without a doctor’s prescriptions. The following are some example of OTC products that are available without a doctor’s prescription:

  • Band Aids
  • Birth Control
  • Braces & Supports
  • Catheters
  • Contact Lens Supplies & Solutions
  • Denture Adhesives
  • Diagnostic Tests & Monitors
  • Elastic Bandages & Wraps
  • First Aid Supplies
  • Insulin & Diabetic Supplies
  • Menstrual Care Products (if incurred after 2019)
  • Ostomy Products
  • Reading Glasses
  • Wheelchairs, Walkers, Canes

Dual Purpose OTC Products

The following products have both a medical purpose and a personal/cosmetic or general health purpose. To be considered for reimbursement, either a doctor’s prescription (if expense was incurred before 2020) or a Letter of Medical Necessity (LOMN) will be required: 

  • Acne treatment/medication
  • Dental fluoride treatments
  • Dietary supplements (ie: vitamins)
  • Fiber supplements
  • Herbal supplements
  • Nose strips for proper breathing
  • Orthopedic inserts
  • Sleeping Aids
  • Snoring cessation aids and medication

Ineligible OTC Products

These products are considered cosmetic or used primarily for personal or general health purposes. The following products are not eligible for reimbursement, even with a Letter of Medical Necessity from a physician:

  • Cosmetics
  • Deodorants
  • Face creams & cleansers
  • Feminine hygiene products
  • Hair removal treatments and waxes
  • Lotions & Moisturizers
  • Mouthwash, antiseptics and oral anesthetics
  • Multi-vitamins
  • Sundry Items (ie: cotton balls/Q-tips)
  • Teeth whitening kits and products
  • Toiletries (ie: soap, shampoo, toothpaste, toothbrush)
  • Wrinkle reducers

Supporting Documentation Requirement

Debit cards can be used for OTC purchases provided that a prescription is presented to a pharmacist. The pharmacist must dispense the item in accordance with all applicable laws, and an Rx number must be assigned (the debit card system does not work unless an Rx number is assigned). The pharmacist must retain certain records (the Rx number, the name of the purchaser or the name of the person for whom the prescription applies, and the date and amount of the purchase), and the records must be accessible by the employer’s plan or its agent. If paying for items with your own money, an itemized grocery/drug store or pharmacy receipt that includes the name of the specific OTC product that was purchased will be required accompanied by a doctor’s prescription or when applicable by a Letter of Medical Necessity such as for Dual Purpose OTC Products. The receipt must also have the location and the date purchased. The IRS does not allow a generic receipt with a copy of the packaging as acceptable documentation. If the receipt does not list the specific OTC product, we cannot reimburse the expense.

It is not intended that these guidelines contain all reimbursable OTC medical items.

Health Shopper tool

BenefitHelp Solutions is introducing a new tool, Health Shopper, to make it easy for you to shop for HSA and FSA eligible products online so you never have to guess if your purchase is covered. You can access Health Shopper directly from your BenefitHelp Solutions online member portal or by using the following link: https://my-healthshopper.com/?id=10583

When you go to Health Shopper you can:

  • View a list of HSA and FSA eligible products
  • Access HSA and FSA financial calculators
  • Learn about eligible products through helpful blog posts and list of FAQs
  • And when you’re ready, you can purchase any of the HSA and/or FSA eligible items listed on the site

The best part? Your purchase is fulfilled by Amazon, which means you get your items from a known and trusted company.

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