New Guidance on FSA, HRA Debit Cards

01.11.2011
HR & Safety

The IRS now says that employees can continue to use health flexible spending arrangement and health reimbursement arrangement debit cards to purchase over-the-counter (OTC) medicines and drugs, if prescribed by a doctor.

IRS notice 2011-5 modifies the agency’s previous position that after Dec. 31, 2010, employees could only be reimbursed for drugs that require a prescription.

The new OTC prescription requirement applies to purchases made on or after Jan. 1, 2011. After Jan. 15, 2011, the use of debit cards must also comply with procedures used by the pharmacy when selling prescribed medicines and drugs.

For a list of frequently asked questions and answers on the new reimbursement rule: www.irs.gov/newsroom/article/0,,id=227308,00.html

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