Moms as Doctors
In most families moms are the caregivers. They know the right cough medicine, the right dosage, the difference between aspirin and Tylenol, and what to do for their child’s allergies. Most moms have a box or tray with all kinds of cures for their children. Mom’s “medicine box” is there to fix the middle-of-the-night pains and fevers. God bless moms.
Relief may range from chicken noodle soup to special itch-soothing creams. Moms handle most issues with love and the right choice of home remedies and over-the-counter medications. If it’s not in “the box” a quick trip a local 24-hour pharmacy will secure the needed treatment. If mom’s care and time don’t make the hurt go away, a doctor’s visit may be in order. But, for most situations a caring mom, Mother Nature and over-the-counter medications get the kids well, and avoid unnecessary visits and expenses to the see a physician.
For years, consumers have been encouraged to use lower cost generics and even less expensive and easily available over-the-counter (OTC) medications. In the past five years, more than 20 million Americans have purchased account-based health insurance (Health Savings Accounts and Health Reimbursement Arrangements). Available since 1978, millions more use a Flexible Spending Account. Many use a plan-provided debit card to pay for medications, including OTC medications. As part of their insurance plan, families can use these accounts to purchase OTC medications such as prenatal vitamins, antacids, allergy medicines, pain relievers and cold medicines.
Unfortunately, much of this will change under the new health law. Effective January 1, 2011 an OTC medication needs a doctor’s prescription to be defined as a qualified medical expense, even if it is otherwise available without a prescription! Only in the world of government control and bureaucracy would it make sense to require a mom, who is treating a sick child at 3 a.m., to get a prescription for an OTC medication. That trip to the 24-hour pharmacy just got “government complicated.”
In the government world of economics, the new provision for OTC medications was estimated to save more than $5 billion dollars. Why? They assumed that moms will just pay cash and not get it covered by insurance reimbursable under tax advantaged Health Savings Accounts, Health Reimbursement Arrangements, or Flexible Spending Accounts. But what is likely to happen in mom’s real world?
- Moms will need to take children to the doctor’s office to get a prescription for an OTC medication.
- Doctor’s will be baffled by the illogic of a request for a prescription for a nonprescription medication. Of course, with new exposure to liability, they will need to see the patient before prescribing anything. This produces an office visit charge, maybe a follow up visit and makes access to care harder for others in real need of physician attention.
- To avoid calls, confusion and assure insurance coverage, physicians are likely to start prescribing stronger “real” prescription drugs. That will add costs and increase patient risks of adverse reactions when a simple OTC medication would have sufficed.
- After spending millions of dollars to accommodate consumers’ needs, drug card vendors will spend millions more changing their cards to deny coverage for OTC medications.
- Pharmacists and checkout clerks will only be able to shrug their shoulders and state, “Sorry, that’s the law,” when a transaction for an OTC medication without a prescription is denied.
OTC medications may not be the biggest problem with ObamaCare. But it is a simple example of government control that will inconvenience millions of Americans. A mom doesn’t have to be an economist to see that in her world just this one item in the new health reform law will increase costs, decrease access to care and lower the quality of care. None of it helps her child.
Health care in the United Kingdom and Germany follow similar government mandates for getting OTC medications. Using those countries as examples, the Foundation for HealthSmart Consumers estimates that in “Mom’s real world” the cost increase for using more expensive prescription medications, more office visits and added pharmacy expenses will total at least $10 billion. Of course, in Washington D.C., the difference between “saving” $5 billion and costing $10 billion is just a rounding error.
The new law is so complicated that few understand all of the details and implications. It is doubtful most members of Congress thought through the unintended consequences. Most likely, they didn’t consider the unnecessary hurt or delays in care for children. In so doing, they dismissed Mom and her medicine box cures. Common sense has taken leave. Come the next election, Mom may just tell some of them to take leave.
Maybe at some point the moms will get mad and take it out on the people who passed this monstrosity.
Interesting way of looking at this. Maybe we should call it the soccer mom tax.
Depending on your tax bracket — and the way you pay for medical care — OTC medications will become nearly 50% more expensive next year. Doctors already tell anecdotes about patients calling to change medications once their prescription drug is switched to over the counter. If anything, public policy needs to encourage OTC use and OTC switching.
Within a few years of Claritin losing patent protection and being switched to over the counter, the cost fell from nearly $1,000 annually to about $20 per year if the generic form is purchased in bulk at Sam’s Club.
I have been using an HSA to purchase OTC drugs for 4 years now and on December 31st of this year I will be making a bulk purchase of as many of the OTC durgs my family normally uses.
I am wondering how this provision will truly be enforced, in a store with a self-check out mechanism one could effectively buy the drug with the HSA card and then get the nurse at your doctors office to send over a perscription in the morning for tax audit purposes.
Also wasn’t there a post a few months ago about a new web-based perscription service, hopefully for us HSA users we can still get the perscription we need, perhaps even for less than the $25 there will be an OTC script option that you can just print.
Devon, the only people who get a real tax advantage from HSAs are the top 10% income earners. If you believe in heaven, you’ll find your path eased if you worried less about the most fortunate losing a tax giveaway and worried more about that working class mother making too much for Medicaid but so little that paying for a doctor’s appointment means not being able to feed her family.
You can also substitute a “Letter of Medical Necessity” for a prescription. For example; If you require a packet of acid reflux medication each month for twelve months the Letter must clearly state this. It must state the specific individual, dosag and duration for each OTC drug. Then you can put it through your FSA/HSA.
Robert,
Your card will only work on IIAS (inventory information approval system) approved items that is tied to the stores SKU numbers. If an item is delisted your card will not recognize the charge and will reject it.
artk, eveybody gets 15% by avoiding the payroll tax and the average middle class family is in the 15% bracket, bringing the total to around 30%. State and local taxes add at least 3%, and much more in some places. One-third off is not chump change.
artk, if these things concern you, you should advocate the flat tax. If everyone pays the same marginal tax rate, then everyone will get the same tax benefit from HSAs.
Erik,
I understand the IIAS issue, but will it magically appear on the IIAS if I have a perscription and not be on the list if I do not? I do not think the list will change as it is still a covered HSA option, but the audit worries will keep consumers from using the HSA account.
Robert,
No it will not appear even with a prescription. It would fall under “Further Substantiation” and you would have to submit a manual claim. With a manual claim you will not have to worry about an audit as the claim has been cleared.
Robert:
I confirm what Erik posted. After January 1, your debit card will not work for OTC purchases. You claim would have to be manual and show medical necessity as recommended or prescribed by an approved practioner. Generally, one letter at the start of the Plan Year is sufficient, provided it states the condition requires treatment throughout 2011.
The new for plan year 2011 does address the etglibiiily of daily vitamins, minerals, and other dietary supplements as a medical expense under the new IRS guidelines (see also , p.16):From page 16 of the ERA 2011 brochure What medicines and drugs are eligible for reimbursement?Prescription medicines and drugs must meet the “medical necessity” definition to be reimbursable. For example, daily vitamins, minerals, and other dietary supplements are not usually eligible for reimbursement because they are used to maintain general health. However, if they are prescribed by your healthcare provider to treat a specific condition (i.e. iron tablets for anemia, calcium supplements for osteoporosis), they are reimbursable if accompanied by a Letter of Medical Need from your physician.
Diphenhydramine will put you to sleep, but for christ’s sake, don’t go past 250 gimlilrams unless you like bats, spiders, and scorpions having a Lord of the Rings type epic battle on the floor of your bedroom.