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How to Use a Medicare OTC Card

An OTC card, which stands for “Over-the-Counter” card, is a benefit of some Medicare Advantage Plans to help beneficiaries streamline buying over-the-counter drugs. This card can help those on a fixed income manage their health expenses better, leading to its increase in popularity and demand. Careful planning on when and how to use the card can further stretch its benefits.

Ensure you get the most out of your OTC card and learn how to maximize the benefits.

Using Your Medicare OTC Card

Medicare OTC cards work like prepaid cards. Depending on your MA Plan, the card is loaded with your OTC benefit amount at the beginning of each calendar quarter or month. Then, you may use the card to purchase covered items at participating stores and pharmacies until you deplete your card balance.

  • To use in store: Use your OTC card at the checkout counter of the store. You slide it into the credit card machine or use the machine’s chip reader, depending on whether or not your card has a chip. OTC cards with a chip will have a visible silver rectangle on the card. However, if you are unsure, do not hesitate to ask the cashier for assistance.
  • To use online: Your Medicare OTC card can be used like a debit or credit card online at eligible online retailers. When you are checking out online, enter in your card details in the same area as the credit card payment. You will typically need to type in the OTC card number and expiration date.

For most plans, your OTC balance does not carry over to the next month or quarter, so spending the total amount available is the best practice. If there’s not enough money on your card to cover the full cost of the item, you’ll pay for the remaining cost out of pocket.

Getting the Most Out of Your Medicare OTC Card

Around 80% of MA Plans offer OTC allowances as one of their top five supplemental benefits, and an estimated 18 million consumers have access to MA Plans with OTC benefits. 

If your MA plan comes with OTC cards, consider the following tips to get the most out of your card and save on healthcare expenses.   

Get to Know Your Card’s Eligible Items

To avoid unpleasant surprises when paying for your over-the-counter medicines and other health-related items, ensure you fully understand your card’s eligible items. Also, different plans may offer different levels of coverage for OTC purchases. 

Some of the most common things that OTC cards can cover include:

  • Antibiotic ointments
  • Flu medicine
  • Pain relief medicine
  • Allergy products 
  • Heartburn medicine
  • First aid materials such as bandages or gauze

Read the fine print of your Medicare Advantage Plan to understand what’s covered and what’s excluded from your OTC card coverage. 

Tip: Make Note of Items You’ll Most Likely Need

Once you know what your OTC card will cover, note the items you will most likely need and use. For example, if you regularly have your grandchildren over, you may need a regular supply of tissues and bandages to help with colds, bumps, and bruises. Noting the most frequently needed items will help you plan for potentially recurring costs.

Tip: Categorize Eligible Items For Easy Organization

Make your own categorization of the eligible items your OTC card covers so you can easily reference it in case a new medical need comes up that the OTC card might cover. For example, categorizing bandages, antibiotic ointments, and gauze under “wound care” and placing nasal spray, pain relief medications, and flu medications under “cold care.”

Tip: Check For Updates Regularly

MA Plans can add or remove eligible items, so check for updates regularly to avoid unpleasant surprises. You can log in to your MA Plan’s member portal to access OTC benefit details or contact your insurance provider’s customer service directly.

Plan Ahead For Your Medicare OTC Spending

Your healthcare needs may change depending on the time of year, especially with flu season spiking in the wintertime. Plan ahead for your Medicare OTC spending to avoid scrambling at the last minute to find the healthcare products you need.

Tip: Mark Your Calendar For Sales and Coupons

Some pharmacies may provide discounts for off-season medications, like cold medications in the summer, so mark your calendar to take advantage of the opportunities. Healthcare companies, like GoodRx, may also offer coupons for certain over-the-counter drugs

Tip: Stockpile Things You’ll Likely Use Later

If you’re likely to use cold medication later in the year and it is currently on sale, purchase it now with the OTC card. As long as the expiration date aligns with your future usage and your MA plan covers the items, stockpiling the medications you know you will need ahead of time can save you a good chunk of change.

Tip: Buy Store Brands or Generic Brands If Available

Store brands or generic brands are often more affordable while offering the same active ingredients as name brands. This allows you to stretch your OTC card funds further. However, check with your doctor before switching medications to make sure the substitutions will not cause any issues. 

Explore Your Options For Where to Use Your Medicare OTC Card

Prices for certain products can vary significantly from one store to the other. Consider finding multiple places to use your OTC card to maximize savings. Note that not all stores accept OTC cards, so call them directly and ask if they accept them before purchasing an item. Retailers that may accept OTC cards include CVS, Walgreens, and Walmart. 

Tip: Look At Online Stores

If you prefer to shop online, consider looking into online retailers that accept OTC cards. The quickest way to find them is by asking your MA Plan provider for information. Once you’ve found a few online stores that accept OTC cards, check their shipping policies to ensure your medications arrive in the mail when you need them. 

All in All

On average, OTC benefit allowances are $400 per enrollee per year, so understanding how to use your OTC card and maximize its benefits can keep your health costs low in the long term. Consider looking into Medicare Advantage Plans that offer OTC cards if you foresee regular spending on medicine, prescription drugs, and other eligible healthcare items.

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