As the Supreme Court considers whether to strike down the health care reform law, OTC industry stakeholders push Congress to eliminate one piece in particular: the requirement that consumers obtain a prescription to purchase OTCs with a pre-tax savings account.

The Health Choices Coalition sent letters March 23 urging House and Senate members to support legislation introduced in 2011 that would strike the provision: S. 1368 and H.R. 2529, both titled the Restoring Access to Medication Act Also see "Momentum Builds To Allow Pre-Tax OTC Purchases Without Prescriptions" - Pink Sheet, 18 July, 2011..

The coalition contends that the goal of the Patient Protection and Affordable Care Act Congress passed in 2010 was to expand access to affordable care, but the provision that limits purchases of OTCs from pre-tax accounts increases costs to the system and places a new administrative burden on physicians’ offices. Proponents said the change allows the federal government to gain revenue needed to fund broader health care reform by limiting the amount of income in the U.S. that goes untaxed.

The Consumer Healthcare Products Association and other coalition members cite a CHPA study showing the health care system saves $6 to $7 for every $1 spent on OTCs Also see "CHPA Quantifies OTCs’ Overall Value To Promote Expanded Access" - Pink Sheet, 6 February, 2012..

Coalition members also include health insurers, doctors’ groups, retailers and OTC firms Bayer Consumer Care and Perrigo Co. PLC

The coalition sent the letter to coincide with the second anniversary of the passage of PPACA, according to John Gay, CHPA’s VP of government affairs.

“The anniversary was a good reminder that the health care reform bill did limit an important benefit that many American families used to make medical expenses more affordable,” he said in an email.

Court Ruling Could Affect Legislation’s Chances

Gay added whether the legislation overturning the provision will pass is “very hard to say … particularly with the Supreme Court yet to rule on the health care law.”

“We just want to be sure we are in as strong a position as possible to include the Restoring Access to Medication Act in any health care bill that might pass,” he said.

The Supreme Court heard oral arguments March 26, 27 and 28 on the constitutionality of provisions of the law, including the requirement that nearly all consumers purchase health insurance and the broad expansion of Medicaid.

While the high court is not hearing a specific challenge to the Rx requirement for OTC purchases from a health savings account, the requirement might be eliminated and consumers could again use flexible spending and health savings accounts to purchase OTCs without prescriptions if a decision strikes down the entire law.

Whether the pre-tax savings account provision and other separate components of the law would remain in effect would depend on another issue on which the Supreme Court heard arguments: severability.

Steve Schwinn, an associate professor at the John Marshall Law School in Chicago, said the justices will decide whether declaring as unconstitutional the individual mandate or Medicaid expansion invalidates the rest of the law.

He added that predicting how the court will decide about severability is complicated by the magnitude of this case.

“On balance, the Supreme Court tends to rule conservatively on these issues in the sense that it doesn’t like to rule things unconstitutional when it doesn’t have to,” Schwinn explained. But this litigation is “a little bit different, and we really don’t know what to expect from the court.”

Coalition Pushes Congress On OTC Purchases With Health Savings Accounts

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