The IRS has issued a Revenue Ruling (2003-102) that changes the guidelines regarding Over-The-Counter medications or drugs (OTC's). Over-The-Counter drugs are those items that do not require a prescription from your doctor.

1. OTC drugs can now be reimbursed from pre-tax dollars through your FSA. This gives you even greater tax savings than available in the past.
2. When planning your future election, keep in mind how much you expect to spend on OTC drugs to take full advantage of this benefit.
3. You may not change your current year election.
4. You may submit a request for reimbursement for OTC expenses already incurred anytime during your current plan year, as long as you can provide documentation which substantiates the expense. The plan administrator can not automatically go back to previously denied claims and calculate reimbursement amounts.
5. Document must include the following:
   1. The name of the drug or item purchased,
   2. The date of the purchase,
   3. The amount of the purchase.
6. To help you determine whether an expense qualifies under your FSA, remember the IRS has stated that eligible expenses must be made for "Medical care". This is defined as amounts paid for the "diagnosis, cure, mitigation, treatment or prevention of disease, or for the purpose of affecting any structure or function of the body". See the chart on the next page for examples.
7. Items that are merely beneficial to an individual's general good health, such as vitamins or dietary supplements, are not expenses for medical care, and therefore are not reimbursable with pre-tax dollars. See the chart on the next page for examples.
8. Your employer may restrict reimbursement of these expenses under your particular plan. They will communicate this to you if applicable.
9. OTC drug quantities you purchase must be limited to a reasonable supply.
10. Drugs must be purchased legally.
11. There may be situations when your doctor recommends a treatment that will be good for your health, but it still may be considered ineligible, such as a vacation.

 For Over-The-Counter Drugs Purchased at a St. Luke’s Pharmacy Please Note:

 St. Luke’s Pharmacy Receipt: in order for a receipt for Over the Counter items from St. Luke’s pharmacies to be eligible, you must have the cashier ring up the eligible OTC items as “FSA” (Flexible Spending Account). We have a special arrangement with the St. Luke’s pharmacy in which they agreed to ring FSA eligible items up as “FSA” upon request since they are unable to list the name of the drugs or medications on the receipts.