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OTC drug reimbursement bill clears Ways and Means

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Members of the House Ways and Means Committee have approved H.R. 1270, a bill that could eliminate one of the consumer annoyances related to the Patient Protection and Affordable Care Act of 2010 (PPACA).

The Restoring Access to Medication Act of 2015 bill would eliminate a PPACA provision that keeps holders of health savings accounts (HSAs), flexible spending arrangements (FSAs), health reimbursement arrangements (HRAs) and Archer medical savings accounts (MSAs) from using account assets to pay for over-the-counter drugs without having a prescription from a health care provider.

The committee approved an amended version of the bill by a voice vote. The amendment postpones the effective date of the change to expenses incurred after Dec. 31, 2015. The original version would have applied the change to expenses incurred after Dec. 31, 2014.

Rep. Lynn Jenkins, R-Kan., introduced the bill along with Rep. Ron Kind, D-Wis. House Ways and Means Chairman Paul Ryan, R-Wis., proposed the amended version that got through the committee. 

PPACA drafters added restrictions on use of health account funds to pay for OTC drugs when they were trying to come up sources of tax revenue to offset PPACA-related costs.

See also: FSA Backers Map House Health Bill and Tax Provisions In Health Reform Act Are Starting To Become Clearer

Lawmakers have tried to restore account holders’ ability to use account funds to buy OTC drugs without a prescription several times over the years. In 2013, for example, Sens. Orrin Hatch, R-Utah, and Marco Rubio, R-Fla., introduced a broad health account bill that included an OTC drug purchase provision.

Health account programs have bipartisan support, and bipartisan critics. Supporters say the programs help users set aside cash to pay for their own health care costs in a flexible, cost-conscious way.

Critics say using the tax code to shape what consumers spend makes the tax code more complicated and often helps higher-income taxpayers more than lower-income taxpayers.

See also: Health Accounts: Witnesses Clash on Value of FSAs, HSAs