>> Big PhRMA Payoff: Hidden Tax on Pedialyte, Prenatal Vitamins, and Pain Relievers
Posted December 23, 2009on:
Oh yes we have all heard our Democratic congressman and our President tell us again that only the rich will pay higher taxes, but what about those taxes hidden ion the Health Care Bills of both the House and the Senate? This is where the big money is and this big money is coming out of your pocket and mine!
……an antihistamine such as Claritin for allergies, pain relief medicine such as Tylenol or Excedrin, Pedialyte to prevent your kids from becoming dehydrated when they are sick, and prenatal vitamins if you and your spouse are expecting another one.
….if you pay for any of these items with money in your flexible spending account (FSA) or health savings account (HSA) – and according to this guide from FSA administrator Benesyst , all of these are eligible expenses — you will face an effective tax increase of up to 40 percent on these items in the health care bill that passed the U.S. House of Representatives. and is poised to pass the U.S. Senate.Both bills restrict individuals with these 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.
the reason you have health savings plans is to reduce your insurance costs and therefore your health care cost. More and more drugs that were once only by prescriptions are now Over the Counter and much less expensive simply because they cost less and you don’t have to have the doctor’s visit to get a prescription to get them. People with chronic illnesses often rely on these drugs and pain killers especially.
...the government ruled that since the tax code written by Congress did not specifically require that “only medicines or drugs that require a physician’s prescription be taken into account” for health expenses, OTC medicines were eligible. The ruling made clear that although health accounts could not purchase items for general health such as toothpaste, they could be used for medicines that treat specific conditions, such as an “antacid, allergy medicine, pain reliever and cold medicine.” Companies that administer FSAs and HSAs have developed extensive lists of a variety of OTC items that are covered. The Benesyst guide fills two pages with an alphabetical list of eligible expenses that includes everything from analgesics to wound care. But Section 9004 of the pending Senate bill and Section 531 of the House bill that passed in November changes the tax code so that “distribution for medicine” from HSAs and FSAs are “qualified only if for prescribed drug or insulin.” Yes, the bills are merciful enough to allow diabetics to purchase insulin under these tax plans, but if you or your family members need Pedialyte, prenatal vitamins or numerous other over the counter health items, you will see a tax hike that could be huge.
...this tax change will almost certainly cost the health care system billions more dollars in unnecessary spending both to the government and private insurance plans. ………..OTC drugs are much cheaper than those available for prescription, but they could now be more expensive to individual consumers given that prescription drugs would still be eligible for favored treatment in the tax plans, and that insurance companies would be mandated to cover many of them. Consequently, any time a consumer has the slightest headache, the financial incentive would often be to see a doctor and get a prescription rather than go to the store and get medicine off the shelf.
The only ones who benefit from this is the drug companies. It will make medical saving accounts that people have set up thru their employers so they could then purcjhas cheaper insurance plans that cover big expenses almost worthless since using them will cost more than using the insurance. Insurance plans will be forced to cover these prescription drugs that cqan be purchased cheaper OTC so the Insurance Plans will be much higher.
And the real kicker is that everyone will be forced to purchase health care insurance or face a large fine and even the possibility of going to jail! Young people who generally need less medical care will be paying for this scam big time!
Again the government, Congress and the President, has lied to We the People. BB