Healthcare costs can add up quickly. If you’re enrolled in a Medicare Advantage plan, an Over-the-Counter (OTC) card may help you pay for certain approved health-related items.
But OTC cards are not available to everyone on Medicare.
There are a lot of rumors going around about these cards (what they are, what they’re not, etc), so we’re here to set the record straight.
In this guide, we’ll explain who may qualify, how OTC benefits usually work, and how to make sure you use the benefit correctly.
What Is an OTC Card?
An OTC card is a benefit offered by some Medicare Advantage plans. It gives eligible plan members a set allowance to buy approved over-the-counter health-related items.
These items may include over-the-counter medications, first-aid supplies, dental care products, incontinence products, and other approved health and wellness items. The card often works like a prepaid debit card, with a balance that renews monthly or quarterly, depending on the plan.
Some plans issue a separate OTC card, and others include the benefit on a member ID card. They do it through an online catalog, a mobile app, or a mail-order system.
For people whose plan includes it, an OTC card can help reduce out-of-pocket costs for certain everyday health supplies.
Who Qualifies for an OTC Card?
Basic Eligibility Requirements
To qualify for an OTC card, you’ll generally need to be enrolled in a Medicare Advantage plan that includes an OTC allowance. Medicare Advantage plans, (aka Medicare Part C), are offered by private companies that contract with Medicare.
Original Medicare alone does not provide a standard OTC card, and not every Medicare Advantage plan includes one.
Eligibility usually comes down to:
- Making sure you’re enrolled in a qualifying Medicare Advantage plan: You have to be a member of a Medicare Advantage plan that includes OTC benefits.
- Your plan’s benefit rules: Your plan decides the allowance amount, covered items, where you can shop, and whether unused funds expire.
- Special plan types: Some Dual-Eligible Special Needs Plans (D-SNPs), which are for people who qualify for both Medicare and Medicaid, could include OTC or similar allowances. But the exact benefit depends on the plan.
Detailed Breakdown by Plan
OTC rules vary by plan, insurance company, location, & benefit administrator. For example:
- HMO and PPO plans: Both types of plans may offer OTC benefits. Some plans limit you to participating stores, online ordering, mail order, or a specific catalog.
- Dual-Eligible Special Needs Plans (D-SNPs): These Medicare Advantage plans are designed for people who qualify for both Medicare and Medicaid. Some D-SNPs include OTC benefits, and some may combine OTC allowances with other approved health-related benefits.
- Plan-specific rules: Two plans from the same insurance company can have different OTC allowances, covered items, retailers, and expiration rules.
Some of the best ways to figure out whether you have this: Review your Evidence of Coverage (EOC), Annual Notice of Change (ANOC), OTC catalog, or plan member portal.
Common Misconceptions
A lot of people assume every Medicare beneficiary gets an OTC card, but that’s incorrect. OTC cards are normally tied to certain Medicare Advantage plans specifically.
Another common misconception is that the card can be used for any item sold at a pharmacy or retail store. The truth is that each plan has a list of approved products and participating retailers.
How to Get and Use an OTC Card
Step-by-Step Process
If your Medicare Advantage plan includes an OTC benefit, here’s what to do:
- Review your plan materials: Check your EOC, OTC catalog, member portal, or plan customer service line to confirm the benefit.
- Watch for your card or access instructions: If your plan uses a card, it may arrive by mail. If it does not, your plan may use your member ID card, an app, a catalog, or online ordering instead.
- Activate your card if required: Some cards must be activated by phone or online before use.
- Shop only for approved items: Use the card at participating retailers, online, through mail order, or through the plan’s approved ordering system.
- Track your balance: Your allowance may renew monthly or quarterly, and unused funds may expire.
Tips for Using the Benefit
- Keep your plan information handy: You might need your member ID number when activating your card or placing an order.
- Make sure your address is current: This helps prevent delays if your plan mails a card or catalog.
- Read the benefit rules: Check approved products, retailer limits, order deadlines, and whether unused funds roll over.
- Plan ahead: Buy eligible items you use regularly before the benefit period ends.
What to Do If There’s a Problem
If you believe you should have an OTC benefit but cannot access it:
- Contact your plan: Ask whether your plan includes an OTC benefit and how you’re supposed to use it.
- Ask why a transaction was declined: Common reasons include non-covered items, non-participating retailers, an inactive card, or insufficient balance.
- Request a replacement card: If your card is lost or never arrived, ask your plan for a new one.
- Ask about your next steps: If you believe the plan is not honoring a listed benefit, ask customer service how to file a complaint or appeal.
How to Maximize the Benefits of Your OTC Card
Maximization Strategies
To get the most out of your OTC card, consider these strategies:
- Plan your purchases: Keep track of your balance and plan your purchases so you use the benefit before it expires.
- Stock up on eligible essentials: Consider approved items you regularly use, such as pain relievers, allergy medications, bandages, dental care products, or incontinence supplies.
- Check expiration rules: Some OTC allowances expire at the end of the month or quarter. Others may have different rules. Check your plan so you do not lose unused funds.
- Use approved retailers: Make sure you shop through your plan’s approved stores, website, catalog, or ordering system.
Product Categories Covered
OTC cards may cover a range of approved products, including:
- Medications: Pain relievers, allergy medications, antacids, cold medicine, and similar over-the-counter drugs.
- First-aid supplies: Bandages, antiseptics, gauze, and related supplies.
- Health and wellness products: Vitamins, supplements, and other wellness items may be covered, depending on the plan.
- Personal care items: Some plans cover items such as incontinence products, oral care products, hand sanitizer, or soap.
Always refer to your plan’s approved product list before buying. Items that seem health-related could potentially still be excluded if they’re not on your plan’s list.
Frequently Asked Questions
What if I lose my OTC card?
Contact your plan provider right away to report the loss and request a replacement.
Can I roll over unused funds?
It depends on your plan. Many OTC allowances expire at the end of the benefit period, so check your plan’s rules.
Can I use my OTC card online?
Some plans allow online purchases through approved retailers or a plan-approved ordering system. Check your plan details before ordering.
Can I get an OTC card with Original Medicare?
Original Medicare does not provide a standard OTC card. OTC cards are usually tied to specific Medicare Advantage plans.
Can I use an OTC card for groceries?
Only if your plan specifically includes that type of benefit. Don’t just assume groceries or healthy foods are covered without checking to see whether your plan says they are.
If you have questions or need help comparing Medicare plan benefits, call or text our team of licensed insurance agents today. Our services are at no cost to you, and we’re happy to help!, and a PlanFit licensed insurance agent will be happy to assist you at no cost to you!
Calvin Bagley is the founder of PlanFit, The Medicare Store, and Nuvo Health. He and his team have helped over 60,000 people navigate Medicare options, and he’s a nationally recognized speaker in the Medicare industry. Most importantly, he’s someone who believes every American deserves clear, honest information without pressure.
