Some drug stores and pharmacies have the option of supporting an IIAS or registering as a 90% Rule merchant. Additionally, plan administrators may elect to support IIAS and/or 90% Rule programs. The chart below highlights some of the key characteristics and requirements of each program.
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Merchant IIAS (Includes TPS Merchant)
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90% Rule
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Program description
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IIAS transactions enable real-time verification that funds approved for debiting an FSA/HRA card account are for eligible medical items, as required by the IRS.
Issuer/issuer processors utilize the IIAS data fields in authorization request transactions to approve and auto-substantiate eligible health care amounts.
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After successful program registration, 90% Rule merchants accept FSA/HRA payment cards just like any other payment card; there are no additional technical requirements for merchants.
Issuers/issuer processors support a list of 90% Rule merchant locations during authorization processing.
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Qualification requirements
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Any merchant that sells prescriptions/Rx or eligible health care items.
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Limited to drug stores/pharmacies that have stores whose sales are primarily eligible medical items (90% or more of sales for each store registered must be from prescriptions or eligible health medical items).
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Technical requirements for merchants
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Merchants are required to make technical changes to support the following:
- Use the SIGIS Eligible Product List to flag eligible health care items in merchant’s inventory.
- Change payment card processing to add FSA amounts to transactions.
- Support a list of FSA/HRA BINs to identify card numbers to add IIAS data fields.
- Store transaction detail for approved FSA/HRA card transactions in the event of an IRS audit.
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Drug stores/pharmacies are not required to make any technical changes.
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Identification of prescription amounts
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Yes, IIAS merchants have the option to include the Prescription/Rx Amount in addition to the Total Health Care Amount; this enables plan administrators to approve more FSA/HRA transactions.
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Not applicable.
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Merchant categories
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Includes the following:
5411 – Grocery/Supermarket
5310 – Discount Stores
5300 – Warehouse Clubs
5499 – Convenience Stores
5912 – Drug Stores/Pharmacies
5122 – Druggist/Drug Proprietaries
5960, 5964, 5965, 5969 – Online
Pharmacies
Various MCC – Other Non-Healthcare Merchants
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Only the following:
5912 – Drug Stores/Pharmacies
5122 – Druggist/Drug Proprietaries
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Cardholder required to submit a transaction receipt to plan administrator
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Because transactions are auto-substantiated, cardholders are most likely not required to submit transaction sales receipts; although it is recommended that cardholders keep copies of transaction receipts.
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Cardholders are most likely required to submit transaction sales receipts; cardholders are recommended to keep copies of transaction receipts.
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Name of merchant list
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IIAS Merchant List
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90% Rule Merchant List
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Transaction data retention
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IIAS merchants are required to store the transaction detail for approved IIAS transactions in the event of an IRS audit for 5 years.
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Not required.
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Annual processes
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IIAS merchants are not required to re-certify unless the merchant makes changes to software that affects IIAS-certified components or if the merchant changes acquirers.
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The IRS requires annual registration and re-attestation that the sales of each registered store location are 90% or more from prescriptions or eligible medical items.
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For more information
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For merchants that operate their own inventory and cash register software, see IIAS Merchant Certification.
For merchants that contract with a POS vendor/third-party servicer, see TPS Merchant Certification.
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For drug stores/pharmacies that sell primarily prescriptions and eligible medical items, see 90% Rule Merchant Attestation.
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