Created 01/01/2008 - 8:00pm
NEW YORK Consumers with FSA accounts are not likely to find many retailers who are not compliant with new regulations this year.
No fewer than 78 retailers, including CVS and Wal-Mart, were compliant with a new set of rules implemented by the IRS regarding the use of debit cards for flexible spending accounts at non-healthcare related merchants. Both Longs Drugs and Walgreens plan to be compliant with the new regulations by Feb. 1, according to SIGIS, the Special Interest Group for IIAS Standards.
Effective Jan. 1, FSA debit cards can only be used at non-healthcare related merchant locations and online pharmacies that have implemented an Inventory Information Approval System (IIAS), which recognizes whether an expense is eligible or ineligible for medical care.
After Jan. 1, flexible spending account card holders will not be able to use their card at grocery stores, discount stores, mail order stores or any other retailer unless the retailer has implemented an IIAS. Drug stores and retail pharmacies that use a pharmacy merchant category code have until Jan. 1, 2009 to comply.
The debit cards will continue to be approved at all retail pharmacy locations through 2008.
Also, the cards will continue to be accepted at healthcare related merchants and service providers such as doctors, dentists and vision care centers.