CARES Act and Reimbursement Accounts

The Coronavirus Aid, Relief, and Economic Security Act (CARES) was signed into law on March 27, 2020. It is a massive bill of over 880 pages intended to help Americans during the COVID-19 (coronavirus) pandemic. It includes a number of provisions that affect your employee benefits plans. We’ve outlined a few of the highlights below.

  • Participants in healthcare FSAs, certain Health Reimbursement Arrangements (HRAs), and health savings accounts (HSAs) now have the ability to have over-the-counter medications as items eligible for reimbursement without the necessity of a prescription –assuming their employer’s plan documents so allow.
  • In addition, expenses for menstrual care products are added to the list of eligible items under an FSA, certain HRAs, and HSAs. Menstrual care products are defined as tampon,pad, liner, cup, sponge, or similar product used by individuals with respect to menstruation. This move puts these health products in line with other already eligible expenses.
  • In the case of HRAs, the plan document must allow for the reimbursement of all Internal Revenue Code Section 105(b) medical expenses in order to cover OTC and menstrual care products. Many HRA plans only reimburse deductible or medical coinsurance and/or copay expenses not reimbursed under the integrated group health plan. In those cases, OTC and menstrual care products would not be an eligible reimbursable expense.

These provisions are retroactive to January 1, 2020 (again, if the plan documents so allow) and are considered permanent changes.

We would also like to ask participants for their patience during the roll out of this new law. The SIGIS (Special Interest Group for IIAS Standards) and merchants will be key drivers of this change as SIGIS will have to release an updated list of eligible products and merchants will have to update point of sale systems to implement those changes. Merchants will adhere to their own timelines regarding completion of this process based on their own internal resources. Card processors and HRPro have no ability to influence this. 

Benefit cards may not work for all eligible purchases and the participant may incur inconsistent shopping experiences until this process by SIGIG and merchants is complete. We expect any issues like this to be temporary and resolved in a fairly short time frame.

If you have any questions regarding these changes do not hesitate to reach out to your HRPro Reimbursement Account Manager.