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The Affordable Care Act (ACA) introduced significant changes to Flexible Spending Accounts (FSAs) by implementing a cap on the amount that individuals could contribute annually. Specifically, the ACA limited FSA contributions to $2,500 per year, which aimed to reduce tax avoidance and increase transparency in healthcare spending. Additionally, the ACA allowed over-the-counter medications to be reimbursed only with a prescription, further impacting how FSAs could be utilized. These changes were intended to enhance the efficiency and effectiveness of health spending accounts.

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