Effective March 2020, Congress passed the CARES Act, which means two big changes for those with a Health Savings Account (HSA), Flexible Spending Account (FSA), or Health Reimbursement Account.
What does this mean?
Here is an overview to help you understand and prepare for these changes.
Over-the-counter Eligibility Changes
The CARES Act allows HSA, FSA, and HRA participants to be reimbursed for the purchase of over-the-counter drugs and medicines without a prescription from a physician. It also includes a reimbursement provision for menstrual products.
This change can take effect upon amending the employer’s plan document. The change can be applied to amounts paid or incurred starting January 1, 2020, where permitted by the employer’s plan. At this time, there is no end date for the new legislation.
Using a Benefits Debit Card for Over-the-counter Purchases
Although this legislation has passed, customers cannot use their Benefits Debit Cards to make over-the-counter purchases yet. The Special Interest Group for IIAS Standards (SIGIS) must first vote on making over-the-counter products eligible within their point-of-sale coding system.
Should the change be approved by SIGIS, merchants will likely begin implementing the changes on or around April 15. Because individual merchants may make the change at a different pace—weekly, quarterly, or annually, for example—each vendor’s adoption rate may vary.
It’s important to note that the addition of menstrual care products to the SIGIS system may not begin until around May 15.
Requesting Reimbursement Without Using a Benefits Debit Card
If a Benefits Debit Card transaction is denied for the purchase of an eligible over-the-counter medical product, or if a customer wishes to pay out-of-pocket, they may submit for manual reimbursement from their HSA, FSA, or HRA.
IMPORTANT: Ensure you receive an itemized receipt to submit with your reimbursement claim.
Updated Plan Documents
As a result of this legislation, First Financial will amend customers’ Section 125 plan documents that are affected by this change, specifically those plans offering FSAs, HRAs, and HSAs.
First Financial sent amendments to all Section 125 Plan employers so they can begin implementing these changes.
Over-the-counter Purchases Made in January
The new provision affects over-the-counter medical or menstrual purchases made beginning January 1, 2020. However, each employer must execute the amended plan documents to allow First Financial to reimburse those expenses.
Additional Eligible Expenses
In addition to over-the-counter products, there are many medical expenses that remain eligible for reimbursement. View FSA and HSA eligible products. By shopping at the FSA Store and HSA Store you can rest assured knowing you’re purchasing eligible items – all from the safety of your home.
First Financial is focused on all legislation related to the COVID-19 pandemic and we will continue to provide updates as developments arise.
If you have any questions specifically related to our efforts, please visit our COVID-19 notices page.