Does My Medicare Plan Pay for OTC Medications in 2024?

Maximizing Your Medicare Advantage Plan: A Guide to OTC Medication Coverage in 2024

A common question among Medicare beneficiaries is whether their plan covers over-the-counter (OTC) medications. With the rising costs of medications, understanding what is covered can significantly impact your healthcare budget. Let’s explore how Medicare Advantage plans have adapted to include OTC benefits and what this means for you.

Medicare Advantage and OTC Coverage

In 2024, OTC coverage is primarily available through Medicare Advantage Plans, also known as Part C. Original Medicare (Parts A and B), and standalone Part D plans do not typically cover OTC medications. However, most Medicare Advantage plans now offer benefits for a range of OTC items, including:

First aid supplies: Items like bandages, gauze, and antiseptic wipes.
Pain relievers: Medications such as acetaminophen and ibuprofen.
Allergy medications: Nasal sprays and oral antihistamines.
Digestive aids: Products like antacids and laxatives.
Vitamins and supplements: Certain therapeutic vitamins (Kaiser Permanente) (MedicareFAQ).

According to recent data, 96% of Medicare Advantage plans include some form of OTC benefits, marking a significant increase from previous years.

Accessing Your Medicare OTC Benefits

To access OTC benefits, beneficiaries typically receive a prepaid card or credits applied to their plan’s member card. This card can be used at participating retailers, including major chains like Walmart, CVS, and Walgreens. It is crucial to check with your specific plan provider for details on what items are eligible and how much your plan allocates for OTC purchases each quarter.

Special Enrollment Periods and OTC Benefits

If you currently have Original Medicare and wish to switch to a Medicare Advantage plan that offers OTC benefits, you might qualify for a Special Enrollment Period (SEP). This allows you to enroll in or change your plan outside the standard enrollment windows. Otherwise, the Annual Enrollment Period from October 15 to December 7 is your opportunity to make such changes.

The Rise of Medicare OTC Benefits

Recent regulatory changes aimed at enhancing preventive care and reducing healthcare costs have driven the inclusion of OTC benefits in Medicare Advantage plans. By covering OTC products, these plans help beneficiaries manage minor health issues at home, potentially avoiding more serious and expensive treatments. For instance, common colds, minor cuts, and allergies are some of the health issues that can be managed with OTC products.

Using Your OTC Benefits

Here are some tips for maximizing your OTC benefits:

Understand Your Plan: Each Medicare Advantage plan has different coverage for OTC items. Review your plan’s list of eligible products to know what’s covered.
Monitor Your Allowance: Most plans provide a quarterly allowance for OTC purchases, typically ranging from $50 to $300. Keep track of your balance; unused funds generally do not roll over to the next period.
Shop Wisely: Make a list of essential OTC items you regularly use, and prioritize these when shopping. Compare prices at different stores to ensure you get the best deals.
Consider Mail-Order Options: Some plans offer mail-order services for OTC items, which can be convenient and sometimes more cost-effective.

Understanding OTC Benefits vs. HSA

While you may use Health Savings Accounts (HSAs) and Flexible Spending Accounts (FSAs) to purchase OTC medications, these are separate from the OTC benefits provided by Medicare Advantage plans. Your HSA and FSA can also cover a broader range of healthcare expenses, but the specific items covered can differ.

Medicare Advantage plans are increasingly popular due to their expanded benefits, including OTC coverage. If you’re unsure about your OTC benefits or have additional questions, consult your plan provider or speak with a Medicare specialist for personalized guidance.

image credit: shutterstock/Kwangmoozaa

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Pete Blasi

President/CEO at My Senior Health Plan

Pete Blasi, the driving force behind My Senior Health Plan and the prestigious Financial Grade Senior Consultants, has been at the helm of both since their inception in 2005. Under his leadership, these well-known and respected organizations have thrived to become renowned full-service Medicare consulting and brokerage firms with a nationwide presence.