There’s been a lot of attention in the media recently related to legislative action to address the rules and regulations that guide flexible spending plans.
In just the last week, Minnesota Public Radio and Business Insurance have both written about the work by FSA advocates and members of Congress to amend the rules governing these accounts that were put into place by the recent health reform law.
In light of this growing interest, I offered to answer some questions about the current legislative environment and its possible effects on the future of FSAs.
Any chance that the OTC rules will change back?
The short answer is yes, there is definitely a chance that the OTC prescription drug requirement will be removed. There is a lot of support for ending this rule, which burdens both consumers and doctor’s offices by requiring consumers to obtain a doctor’s prescription in order to be reimbursed from their FSAs for over-the-counter medications.
Six different pieces of legislation have already been introduced in Congress to reverse this decision, which shows strong support for getting it done. For a more detailed explanation on the legislation that has been put forth, see my previous article “OTC study encourages congressional action.”
What can the average person do to get the FSA rules and regulations back to the way they were in 2010?
The best way to encourage a change to the existing rules and regulations is to share your views with your members of Congress. E-mail, phone calls, and in-person meetings (especially now, while Congress is on recess and may be visiting their district offices) are good ways to share your opinion. Also, think about writing a letter to the editorial board of your local newspaper. Savemyflexplan.org has a number of resources that can help you find your representatives and encourage them to take action to remove burdensome restrictions on FSAs.
Will there be a diminishing need for flexible spending accounts now that insurers are providing expanded coverage as required by the Affordable Care Act?
Consumers will definitely still need FSAs to help them cover the costs of out-of-pocket health care in 2012 and beyond. While they are no longer required to share the costs of some preventative services, such as screenings, pre-natal care, and vaccinations due to the implementation of the Affordable Care Act, they will still have out-of-pocket costs for prescription drugs, doctor and hospital visits, dental and vision care, and much more.
Those with some of the highest health care costs - families and individuals battling chronic conditions - will also continue to have a strong need for the cost savings provided by FSAs. A recent survey by the National Business Group on Health showed that consumers’ out-of-pocket spending did not change much in 2011, even after the introduction of some free preventative services, so most FSA participants will still see a need for the benefit.
When Congress resumes their work in September, we’ll keep you updated with any developments related to health care FSAs and other pre-tax benefits. In the meantime, please feel free to reach out to me with any questions on legislation and compliance by writing to firstname.lastname@example.org.