Medicare Advantage OTC Benefits: What Is the Over-the-Counter Card and How Does It Work?

One of the most talked-about extras in Medicare Advantage plans is the OTC benefit card — a prepaid allowance you can use to buy everyday health products at participating retailers. If you’ve seen ads promising “free money” for groceries, vitamins, and health supplies through Medicare, this is what they’re referring to. Here’s the honest, detailed explanation of how OTC cards work, what you can and can’t buy, how much they’re typically worth, and how to find a plan that includes one.

What Is a Medicare Advantage OTC Benefit Card?

An over-the-counter (OTC) benefit card is a prepaid card provided by your Medicare Advantage plan that is loaded with a set dollar amount each month, quarter, or year. You use it like a debit card at participating stores or through the plan’s OTC catalog to purchase approved health-related items. The benefit is one of the “supplemental benefits” that Medicare Advantage plans offer beyond what Original Medicare covers — and it’s one of the most popular.

OTC benefits are not available with Original Medicare. They are exclusively offered through Medicare Advantage plans.

How Much Is the OTC Allowance Worth?

OTC allowances vary significantly from plan to plan and from one county to another. In 2026, typical OTC allowances range as follows:

Some plans issue the allowance monthly, others quarterly. If your plan issues it quarterly, you may receive $150 or $300 every three months instead of a smaller amount each month. Unused balances typically do not roll over to the next period — if you don’t use it, you lose it.

What Can You Buy With the OTC Card?

Each plan maintains an approved OTC catalog — a list of eligible items. While specifics vary by plan, most OTC allowances can be used for:

What Can’t You Buy With the OTC Card?

OTC cards are not blank checks. Most plans explicitly exclude:

• Prescription medications
• Alcohol and tobacco products
• General food and groceries (a separate “healthy food” or flex card benefit exists on some plans)
• Cosmetics or non-health-related personal care items
• Electronic devices not on the approved catalog
• Clothing or apparel

Some plans offer a broader “flex card” or “healthy food card” that can be used for more categories including groceries. The OTC card is narrower and specifically tied to health-related products. Confirm the exact eligible item list with your plan’s OTC catalog.

Where Can You Use the OTC Card?

OTC cards are accepted at participating retail locations. Common in-store options include:

• Walmart and Walmart Pharmacy
• CVS Pharmacy
• Walgreens
• Rite Aid
• Dollar General
• Select grocery store pharmacies

Many plans also offer an online catalog where you can order eligible OTC items and have them shipped directly to your home — a convenient option if you have limited mobility or transportation. The plan’s member portal or mobile app typically allows you to browse and order from the OTC catalog.

How to Use Your OTC Card

1. Pick up eligible items at a participating store (look for approved items only).
2. At checkout, swipe or tap the OTC card — it works like a debit card.
3. Items not on the approved list will be declined by the card; you’ll need to pay for those separately.
4. Check your remaining balance in your plan’s member portal or by calling the plan.
5. Use the balance before the end of the benefit period — it typically does not roll over.

How to Find a Plan With an OTC Card

During the Annual Enrollment Period (Oct 15 – Dec 7), you can compare Medicare Advantage plans on Medicare.gov or call a licensed Medicare advisor. When comparing OTC benefits, ask:

• What is the monthly or quarterly OTC allowance amount?
• Does the balance roll over or expire at the end of each period?
• Which stores accept the card in my area?
• Is there an online ordering option?
• Is the OTC card separate from any grocery or flex benefit?

The Bottom Line

The OTC benefit card is one of the most practical extras that Medicare Advantage plans offer. An allowance of $25 to $150 per month toward vitamins, pain relief, hygiene products, and health supplies adds up to $300 to $1,800 in real value over a year — for items you would likely buy out of pocket anyway. If you’re shopping for a new Medicare Advantage plan, the OTC allowance amount and ease of use should be a factor in your comparison.