Medicare Advantage's shrinking OTC allowance

Fewer than two in five Medicare Advantage PPO members will have an over-the-counter allowance in 2027. In 2023 it was 86%.

That's the card you or your parents use for vitamins, bandages and cold medicine. We read every plan's filing from 2022 to 2027. Six things stand out.

1. Fewer plans offer it. In regular HMOs the share fell from 93% to 63%. In PPOs, from 86% to 39%.

2. It's worth less. Averaged over every member, the HMO allowance fell from $288 a year to $113. In PPOs, from $218 to $65.

3. Plans file it three ways. Its own line in CMS's over-the-counter section. Its own card, filed in a different section. Or a shared card that also pays for other things, like groceries, which can't be split. UNH's regular plans file almost all of theirs the second way.

4. UNH's allowance was already smaller. Averaged over every member, its PPO allowance fell from $163 a year to $47. Everyone else's PPOs went from $238 to $69.

5. The big insurers moved differently. Humana's HMOs went from 76% to 58%, HCSC's from 86% to 53%, UNH's from 74% to 63%. Kaiser held flat.

6. Duals still have it. 99% of dual-eligible HMO members do, more and more of it on a shared card that can also pay for groceries and utilities for those who qualify. UNH's dual card averages $220 a month for 2027, up from $195.

Open enrollment starts Thursday. The OTC allowance used to come with most plans. For 2027, it's something you have to check for.