Change is on the way for millions of Americans who pay for over-the-counter medicine using a Flexible Spending Account or a Health Savings Account.
It’s the result of a provision in the health-care reform law. Starting January 1, those employees will have to have a doctor’s prescription to use that money for most over the counter medicine.
“I think we’re taxed enough so if we can get a tax break on medicine, I think it’s a good thing,” Veronica Esqueda said. “I don’t think they should do away with it.”
Esqueda spent Tuesday afternoon using up all the money in her account to stock up on everything from vitamins to eye drops. The accounts allow users to collect money before taxes and then use it for qualified medical expenses. In most cases, a pre-paid debit card is used.
“Most of the people don’t know what’s coming next year,” Jorge Cervera said. “Even people that know what’s going on, they’re still going to have problems.”
The savings-account change is expected to generate up to $5 billion over 10 years in taxes paid on the over-the-counter remedies. Opponents argue the change will simply flood doctors’ offices with people seeking prescriptions for their favorite over-the-counter medicine.
“Doctor’s offices are already so overworked and understaffed that I think it’s probably going to be just something else that they’re going to have to do and I don’t think they’re going to appreciate it at all.”