Your role isn’t just to help clients choose the right Medicare Advantage plan – it’s also about making sure members fully understand the extra benefits available to them. Two of the most valuable supplemental benefits are OTC (over-the-counter) allowances and food cards. Being able to clearly explain these programs not only supports your clients but also strengthens your credibility, increases client satisfaction, and even boosts retention!
In this guide, we’ll break down exactly how OTC benefits work, what members can buy with their food cards, when funds load, what expires, and the best ways to help clients make the most of these offerings in the coming year.
What are OTC Benefits?
OTC benefits provide Medicare Advantage members with a quarterly allowance they can use on approved over-the-counter health items. These benefits are automatically included in most Medicare Advantage plans and help reduce out-of-pocket costs for everyday items clients may need.
When Are OTC Funds Loaded?
OTC funds are automatically added on a quarterly schedule:
- January
- April
- July
- October
Funds are added to each member’s account at the beginning of each quarter, so no action is needed on their part to receive their benefit.
What Can Members Buy with OTC Funds?
OTC allowances can be used to purchase approved health-related products. Items include:
- Pain relievers (ibuprofen, etc.)
- Bandages and first aid necessities
- Cough, cold, allergy, and digestive medication
- Vitamins and supplemnets
- Dental care (toothpaste, floss)
Note: Approved retailers vary between carriers. Many carriers allow clients to purchase items at CVS, Walmart, Walgreens, and online catalogs.
Do OTC Funds Expire?
Yes – all OTC funds expire at the end of each quarter. Unused dollars do not roll over.
*Example: If a client receives $40 in January and uses only $25, the remaining $15 disappears when the next cycle begins in April.*
Encourage your clients to use the full amount each quarter to maximize their benefits.
Now let’s talk about food cards and how they compare…
What are Food Cards?
A food card is a prepaid benefits card that eligible members receive as part of their health plan. Depending on the carrier and the member’s qualifications, the card may be loaded monthly, quarterly, or annually.
Food cards are a very popular supplemental benefit because they help members pay for essential grocery and everyday household items.
These benefits are usually available to clients:
- With chronic conditions
- Dual-eligible (Medicare and Medicaid) beneficiares
- Enrolled in plans offering “healthy food” allowances
What Can Members Buy with Food Cards?
Food card eligible items vary by plan, but common items include:
- Fresh fruits and vegtables
- Meat, poultry, and seafood
- Dairy
- Whole grains
- Nutriton shakes
- Household items
Most carriers allow purchases at major grocery stores, regional grocery chains, and places like Walmart and Target. Some allow online shopping, but again, this is up to the carrier.
Agent Tips: How to Explain OTC & Food Cards
- Use simple language
- Be clear that OTC=health products and Food Card=groceries and healthy essentials
- Communicate about expiration
- Explain the quarterly expiration so members aren’t surprised when unused funds disappear.
- Encourage members to make a shopping plan
- Recommend they make a list of items they need and check if they can be bought with their benefits to save on out-of-pocket costs.
- Help clients active or access thier card
- Quickly walk clients through where and how to access their card, their benefit balance, and answer any questions they may have.
- Use benefits as a retention strategy
- When your clients understand and use their benefits, they are more likely to stay with their plan and stay with you as their trusted and helpful agent!
Be the Knowledgable Agent
Supplemental benefits like OTC allowances and food cards offer great value, but only when clients understand how to use them. By educating your clients, you’re helping them stretch their benefits, save money, and feel more confident with their coverage. Encourage clients to check balances, use their benefits each quarter, and reach out when they have questions. These points can go a long way in building stronger relationships and ensuring continued success in the year ahead.
