AMA House of Delegates

Claudia L. Reardon, MD, a psychiatrist and an alternate delegate for the Wisconsin Medical Society. Photo by Ted Grudzinski / AMA
AMA house seeks repeal of OTC drug-spending rule
■ Patients with tax-exempt medical spending accounts are asking physicians to write prescriptions for over-the-counter medications.
By Kevin B. O’Reilly — Posted July 4, 2011

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Chicago -- Delegates said a health system reform law provision that bars patients from using tax-exempt funds to buy over-the-counter medications without a prescription is adding to physicians' administrative burden and directed the AMA to support repealing it.
The rule, which took effect Jan. 1, applies to tax-exempt funds patients hold as part of health reimbursement arrangements or health savings, flexible savings or Archer medical savings accounts. It was one of many provisions in the Patient Protection and Affordable Care Act aimed at raising revenue to pay for expanding insurance coverage to an estimated 32 million Americans by 2019.
AMA delegates said the provision has led to calls and office visits from patients asking them to write prescriptions for OTC medicines or order similar drugs that are available by prescription only.
"While this is an effort to control costs, the opposite is happening," said Claudia L. Reardon, MD, a psychiatrist and an alternate delegate for the Wisconsin Medical Society from Madison who spoke on behalf of the Young Physicians Section. "We're seeing an increased administrative burden for physicians and decreased access to care. We are being told by malpractice insurers that to write over-the-counter prescriptions, we need to see patients in person."
Maryanne C. Bombaugh, MD, an ob-gyn and an alternate delegate for the Massachusetts Medical Society from Falmouth who spoke for the New England delegation, agreed. "This is creating a large amount of work for practices. Patients who could formerly get their Tylenol or smoking cessation products over the counter through this benefit now are going to the doctor's office and emergency rooms to get this covered. This really is a burden not only for practices and physicians but for their patients and actually increases the cost of care."
A bill proposed in late May by Sen. Orrin Hatch (R, Utah) would repeal the provision and clarify that tax-exempt medical funds can be used to pay retainers for primary care services that are provided by physicians under direct payment, or concierge, arrangements. Rep. Erik Paulsen (R, Minn.) introduced a companion bill in the House.
Enrollment in health plans in which patients are eligible to use HSAs exceeds 11 million, according to the insurer trade group America's Health Insurance Plans.