Information on Flex Benny Cards

Employer Bulletin January 17, 2011 Good News on OTC Changes and the BennyTM Card   On Dec. 23, 2010, the Internal Revenue Service issued IRS Notice 2011-5 allowing the continued use of FSA and HRA debit cards to purchase over-the-counter (OTC) medicines and drugs. This does not change the fact that under the Affordable Care Act "only prescribed medicines or drugs...and insulin (even if purchased without a prescription) will be considered qualifying medical expenses and subject to preferred tax treatment" for FSAs, HRAs and HSAs. (Read the IRS FAQ for more details.) Effective Jan. 15, 2011, the use of FSA and HRA debit cards to purchase OTC medications must comply with procedures consistent with those that pharmacies follow when selling prescribed medicines or drugs.  A prescription for the OTC medicine or drug is presented to the pharmacist or other vendor. The OTC medicine or drug is dispensed in accordance with applicable law and regulations. An Rx number must be assigned. The pharmacy or other vendor retains a record of the prescription number, the name of the purchaser, and the date and amount of the purchase. All of these records are available to the employer or its agent on request. If all these requirements are met, the debit card transaction will be considered fully substantiated at the time and point of sale.  No further documentation will be required.  We have updated our published materials with this information:  OTC Flier OTC FAQ  Examples of Eligible Expenses Please encourage your employees to visit the Manley Services Web site, ManleyPlan.com, for additional information regarding this change. Questions? Feel free to contact your Client Service Representative directly or our Sales and Client Service Department at (541) 485-7488 or (800) 422-7038; clientservice@manleyserv.com. Are You Using the BennyTM Card? You Should Be! Why? Because the Benny Card allows your participants to access their FSA funds directly from their FSA account -- no need to pay for items or services out of pocket, file a reimbursement request, then wait for payment. With the Benny Card, there is no wait. Each transaction draws directly from the participants' stored FSA account. Plus, many transactions (like co-pays, OTC items, and Rx) are automatically substantiated, so there is no need to file a claim for reimbursement or provide supporting documentation. For more details, please see our Benny Card flier.  © Manley Services, 2011