If you have not updated your plan documents to conform with the new rules for reimbursing the cost of over-the-counter (OTC) drugs under the Patient Protection and Affordable Care Act (PPACA), time is almost up. You only have till June 30!
Under the PPACA, only OTC drugs that have been prescribed may be reimbursed through cafeteria plans, flexible spending accounts (FSAs), health reimbursement arrangements (HRAs), health savings accounts (HSAs) and Archer medical savings accounts (MSAs). This requirement went into effect on Jan. 1, 2011 (note, however, that it does not apply to insulin).
Even though this OTC drug reimbursement restriction has been in place for nearly six months, the IRS permitted benefit plans to wait until June 30, 2011 to amend their governing plan documentation, retroactively, to reflect this change.
Employers should review their plan documents to ensure they have been updated to reflect this change. Plans may also need to be amended to reflect other PPACA provisions, including revising plan definitions of “dependent” to indicate that the term now includes adult children up to age 26.