ARLINGTON, VA — November 19, 2010 — Grocery stores across the country are calling on the U.S. Congress to repeal the requirement that prevents consumers from using their flexible spending accounts (FSAs) to purchase over-the-counter (OTC) medicines without a prescription. This provision, enacted into law as part of the Patient Protection and Affordable Care Act, removes over-the-counter (OTC) medications from the list of eligible medical expenses for reimbursement by FSAs and Health Savings Accounts (HSAs) effective January 1, 2011. The Food Marketing Institute and the National Grocers Association signed a letter along with other organizations seeking a repeal or delay of the provision.
“The supermarket industry invested considerable resources into developing a system to make it convenient for our customers to use FSA debit cards for OTC medications. Removing cough and cold medicines and other OTC products from the list of eligible non-prescription items in the FSA plan will certainly put an additional tax on our customers,” said Leslie G. Sarasin, FMI President and Chief Executive Officer. “Our desire is to be able to offer consumers a choice and give them access to affordable OTC treatments through their FSA so they can meet the healthcare needs of their families at the lowest cost possible.”
FSAs, which are offered by 85 percent of large employers, make everyday medical expenses more affordable. The availability of OTC medicines through an employer-sponsored FSA provides valuable cost-savings to consumers, increases worker productivity and encourages smart healthcare decisions by both employers and employees – all of which are consistent with the goals of healthcare reform.
“At a time when America’s middle class families are struggling to make ends meet the new government restrictions that require a prescription to purchase an over the counter medicine using FSA funds is counter productive and unfairly reduces consumer’s healthcare benefits,” said Peter J. Larkin, NGA President and CEO. “Independent retailers have invested considerable capital in technology to accept FSA funds from their customers as an important payment option. This law effectively blocks them from using this option and should be repealed.”
The nation’s grocery stores request that Congress act before adjournment to reverse the provisions of the Patient Protection and Affordable Care Act and help the estimated 35 million working Americans who rely on voluntary contributions of pre-tax dollars to FSAs to help meet their basic health care needs, including the purchase of safe, affordable OTC medicines.
N.G.A. is the national trade association representing the retail and wholesale grocers that comprise the independent sector of the food distribution industry. An independent retailer is a privately owned or controlled food retail company operating a variety of formats. Most independent operators are serviced by wholesale distributors, while others may be partially or fully self-distributing. Some are publicly traded but with controlling shares held by the family and others are employee owned. Independents are the true “entrepreneurs” of the grocery industry and dedicated to their customers, associates, and communities. N.G.A. members include retail and wholesale grocers, state grocers associations, as well as manufacturers and service suppliers. For more information about N.G.A. and the independent sector of the industry, see the N.G.A. website: www.NationalGrocers.org.
Food Marketing Institute (FMI) conducts programs in public affairs, food safety, research, education and industry relations on behalf of its 1,500 member companies — food retailers and wholesalers — in the United States and around the world. FMI’s U.S. members operate approximately 26,000 retail food stores and 14,000 pharmacies. Their combined annual sales volume of $680 billion represents three-quarters of all retail food store sales in the United States. FMI’s retail membership is composed of large multi-store chains, regional firms and independent supermarkets. Its international membership includes 200 companies from more than 50 countries. FMI’s associate members include the supplier partners of its retail and wholesale members.