On January 8, 2025 the Centers for Medicare & Medicaid Services (CMS) released a letter in response to Rep. Lloyd Doggett’s request for clarification that Medicare Advantage (MA) “flex cards” should be excluded from the calculation of income when determining eligibility for public benefit programs. The CMS response emphasized that flex cards, which are similar to preloaded debit cards, “are not benefits themselves,” and also “are not cash benefits and cannot be considered as such.”
“A plan debit card is not a covered benefit but rather, a mechanism by which an MA plan may provide payment to providers for…covered benefits,” the letter, signed by CMS Administrator, Chiquita Brooks-LaSure stated. It continued, “we have made it clear that debit cards are not benefits themselves, but rather a mechanism for MA plans to make payments for plan covered items and services. In other words, they are simply a means to access a covered benefit.”
This letter echoes language in a recently published proposed rule from CMS that states “[t]he debit card itself is not a supplemental benefit; rather, it is a tool used to administer coverage. . .”
The Center for Medicare Advocacy applauds this clear language from CMS, and encourages other agencies to treat these flex cards accordingly; the amounts on the cards should not be counted as income or assets for purposes of public benefit determinations.
Rep. Doggett’s October 2024 letter was sent in response to reports that some public benefit administrators are counting the dollar amounts on flex cards in the income and asset calculations for benefits. Some of the public benefits affected include federal rental assistance, SNAP food assistance, PACE, and Supplemental Security Income (SSI).
The Center for Medicare Advocacy has been monitoring this situation after learning that some Connecticut low-income housing complexes are imposing rent increases on residents who are in MA plans with flex cards. The amounts on the cards are being counted toward income whether the residents actually use the cards or not. Housing administrators have cited the policy of the federal Housing and Urban Development agency when raising beneficiaries’ rents.
Many private MA plans heavily promote flex cards in their advertisements, though the amounts on the cards, permitted uses, and other details vary by plan. The cards can be appealing to beneficiaries who struggle to cover their out-of-pocket costs each month, as they can sometimes be used to purchase items such as groceries and over-the-counter medications. However, we urge beneficiaries, particularly those who are dually eligible for Medicare and Medicaid, to proceed with great caution when selecting their Medicare coverage, and to consult with their local SHIP program for free, unbiased advice.
- The letter from CMS in response to Rep. Doggett is available here
- Rep. Doggett’s letter is available here
- CMA’s Alert on this topic is available here
- CMA Press Release is available here
January 9, 2025 – K. Kertesz