Every year I guess the amount to put in my flexible spending account for the health care costs I'm pretty sure will take place in the coming year. This is a great tax savings benefit in that the money that goes into this account is deducted from my salary and I don't pay taxes on it. The downside is that if my guess is too high then I lose whatever money I haven't used by the end date. If my guess is too low then I pay for it using money that is not tax free.
One expense category covered by the flex spending is over the counter drugs. It's not a lot compared to everything else, but acetaminophen, ibuprofen, nonprescription allergy meds, etc., can add up over the year. It turns out that might go away because both the House and Senate version of the health care reform bill remove it.
Both bills restrict individuals with these [flexible spending accounts and health savings accounts] pre-tax accounts to buying a “medicine or drug only if such medicine or drug is a prescribed” one. And ironically, this tax that will raise health care costs substantially by creating incentives for the use of more expensive prescription drugs even when OTC drugs are just as safe and effective.
I will let Congresswoman McMorris Rodgers and Senators Murray and Cantwell know where I stand on that.
4 days ago