The bill, S.4463, was introduced yesterday and has been referred to the Senate Finance Committee, said Dan Fabricant, president of NPA. The bill would allow the use of Health Spending Account (HSA) and Flexible Spending Account (FSA) funds to be used to buy ‘certain dietary supplements.’ These accounts allow consumers to put away money in advance to pay for qualified medical expenses without having to pay income tax on those funds.
Part of ongoing NPA agenda
This is not the first time NPA has sought this change, with past efforts dying one legislative death or another. But Fabricant said the prospects for passage this time around are good because of the special conditions brought on by the pandemic. Sales of Vitamin C, zinc and some herbal products with immunity tie-ins have gone through the roof in the first half of 2020.
“About two years ago we started working with the Administration and the IRS on this,” Fabricant told NutraIngredients-USA. “I think the prospects are pretty good. Feminine products and OTC drugs have already been made eligible.”
“I think in this environment people just want better choices. There are millions of dollars every year that go unspent in HSAs and FSAs,” Fabricant said.
Definition based on structure/function claims
The bill is meant to apply to vitamin and mineral products as well as those that make structure/function claims. Fabricant said the thinking on the latter was that these claims are submitted to FDA prior to going on the market, so the Agency has an opportunity to vet them. Fabricant said this could remove some of the of the opposition from some quarters that these special funds could be used to buy products that some observers might consider to be fraudulent.
The potential boost to the market could be significant, Fabricant said.
“We think as much as $3 billion of HSA funds are sitting in accounts unused,” he said. “The number for FSAs is a little harder to come by because they are accounted for differently.”
Fabricant said NPA has already organized a grass roots effort to support the initiative and encourages companies and individuals to join in.
“We’d like to have tens of thousands of letters going to Congress on this. Now is the time to be heard,” Fabricant said.