Traditional Medicare doesn’t cover some of the key medical needs of seniors, such as hearing aids.
There’s an alternative choice: Medicare Advantage plans, also called Medicare Part C, offer a variety of allowances, which are budgets for specific items or categories, such as hearing aids, groceries, transportation to medical programs and wellness programs.
[READ: Medicare vs. Medicare Advantage: How to Choose.]
What Are Medicare Allowances?
Medicare Advantage plans cover a few extra healthcare costs that original Medicare doesn’t cover. Additionally, plans may offer extra perks, known as Medicare allowances, that cover nonmedical items or services that support your health, such as paying for groceries, glasses or hearing aids.
Medicare allowance benefits are typically “above and beyond” those available in basic Medicare, and can be advertised as enticements for people to sign up for Medicare Advantage.
Services offered through Medicare allowances differ by plan, depending on the insurance company, or carrier, providing you with your Medicare Advantage plan, such as UnitedHealthcare, Aetna or Humana. Carriers are required to meet certain standards when offering a Medicare Advantage plan, so basic benefits are relatively consistent from company to company. They have more freedom when divvying up Medicare allowances, however, so allowances can vary widely from carrier to carrier.
“That’s where you really have to get into the nitty gritty,” says Dr. Kanwar Kelley, a board-certified otolaryngologist and cofounder and CEO of Side Health. This means you should do your homework in terms of shopping, comparing and contrasting individual Medicare Advantage plans.
Nicole Toneatti, a Columbus, Ohio-based licensed insurance agent with HealthMarkets Insurance Agency, says it can help to think of Medicare allowance offerings as a little something extra to help you with your healthcare costs — but perhaps not the most important reason you choose a carrier.
She says beneficiaries often prioritize a plan that keeps their doctors in-network to avoid extra out-of-pocket costs for medical visits and procedures and to ensure easy access to their medications over the plan’s list of allowances. However, this isn’t always the case.
“That can really vary based on need,” Toneatti says, adding that she’s seen clients “drop doctors for benefits before,” and will work with them to make these decisions if that’s what they want to do.
“It’s just a matter of having that conversation and saying, ‘OK, what is important to you?'” Toneatti says.
The confusion around “Medicare allowance”
The term “Medicare allowance” can be confusing because Medicare beneficiaries use it to describe two entirely different concepts depending on their plan type:
Original MedicareKnown formally as the Medicare-approved amount, this is the maximum fee that original Medicare agrees to pay a doctor or hospital for a specific medical service or procedure.
Many beneficiaries are shocked to receive a bill that exceeds Medicare’s stated allowance. This discrepancy usually happens under original Medicare when you visit a nonparticipating provider.
While these doctors accept Medicare, they have not signed a contract to accept the Medicare-approved amount as full payment. By law, they are allowed to charge up to 15% more than the standard allowance — a surplus known as an excess charge — and they pass that entire bill down to the patient.
Imagine you receive a medical service where the doctor is nonparticipating.
— Provider Charge: $115
— Medicare Approved Allowance: $100
— Patient Responsibility: $115 – $100 = $15 in addition to your standard 20% Medicare Part B coinsurance
Medicare Advantage (Part C)This refers to a supplemental benefit budget — and what this article focuses on. This is a pool of plan-provided funds used to purchase nonmedical health items like groceries, over-the-counter drugs or fitness classes.
[READ: How and Why to File a Medicare Appeal]
Examples of Medicare Advantage Allowances
Common types of Medicare Advantage allowances offered include:
Medicare grocery allowances
Some Medicare Advantage plans offer a grocery allowance. With these, you usually get a card to pay for foods such as fruits and vegetables, frozen meals, fresh salad kits, dairy products, water and soup. You can’t use your card for items like alcohol, sugary and processed foods or pet food.
This allowance is generally available either through Primarily Health Related Supplemental Benefits (PHRB) or Special Supplemental Benefits for the Chronically Ill (SSBCI):
— Primarily Health Related Supplemental Benefits (PHRB): Extra, nonstandard medical services and items offered by Medicare Advantage (Part C) plans that directly diagnose, prevent or treat an illness or injury, compensate for physical impairments or reduce avoidable emergency room visits.
— Special Supplemental Benefits for the Chronically Ill (SSBCI): Nonmedical, extra benefits offered by some Medicare Advantage plans to support members with severe or complex health conditions.
Medicare Special Needs plans also commonly offer grocery allowances as well as other Medicare Advantage allowances. To qualify, you likely will need to undertake an annual wellness visit, complete a health risk assessment and provide documentation of a specific condition.
“Medicare Advantage plans may use Primarily Health Related Supplemental Benefits to reach a broader population, as they must apply these benefits uniformly to all plan beneficiaries,” says Katie Garfield, Whole Person Care Center for Health Law and Policy Innovation Director at Harvard Law School.
Typical broader benefits are wellness plans and groceries (or meal delivery) after surgery or short-term during a lifestyle change.
Supplemental benefits for the chronically ill can offer long-term meal services or grocery allowances.
This allowance amount doesn’t roll over from month to month, so you need to use all of it in that month, or you will lose it. It’s also important to note that you may not be able to use your card at all stores, so you need to find out where to shop with this allowance. Your plan can provide you with a list of eligible stores. At the same time, some plans will enable you to use your card for services like home-delivered meals, such as after surgery or a hospital stay.
Medicare wellness programs
Wellness programs were among the earliest perks offered by Medicare Advantage plans. One of the most recognizable of these wellness programs is the SilverSneakers program, which allows Medicare Advantage members to choose a participating fitness center and enjoy equipment and classes. They also sometimes provide at-home workout kits.
“Giveback” allowances
A giveback allowance (also known as the Medicare Part B giveback) is a benefit offered by select Medicare Advantage (Part C) plans that covers a portion — or sometimes all — of your monthly Medicare Part B premium. The amount of money that a carrier gives in a giveback can vary carrier to carrier.
Depending on how you pay for your insurance, you’ll receive giveback funds as a credit on your monthly Social Security benefit or pay a reduced monthly amount for your Medicare plan.
Other types of Medicare Advantage allowances
Other types of allowances can include coverage for:
— Nonemergency transportation
— Meals
— Bathroom safety devices
— Eyewear
[Read: How to Choose the Best Medicare Advantage Plan]
Medicare Advantage Allowance Changes 2026
Like other aspects of Medicare and Medicare Advantage plans, Medicare allowances have the potential to change year to year.
For 2026, Medicare Advantage plans are tightening up their extra perks. While core coverage (vision, hearing and dental) remains widely available, plans have cut back on nonmedical allowances. In particular, fewer plans offer over-the-counter and grocery allowances, and those that do may have reduced quarterly or monthly allowance limits compared to previous years.
[READ: 7 Reasons to Switch Medicare Part D Plans in 2026]
Why Carriers Want You to Use Your Allowances
When Medicare Advantage beneficiaries actively use their plan’s allowances, those carriers can be awarded with a five-star Medicare rating from the Centers for Medicare and Medicaid Services. Not only does a five-star rating sound attractive, but reaching this status allows the carrier to open enrollment outside the regular period for existing Medicare Advantage beneficiaries. This means if you’re unhappy with your current plan, you may consider switching.
“So there is an incentive to make sure that the benefits (allowances) that are being offered to the clientele and the beneficiary are something that they are going to use,” Toneatti says.
Reyna Gobel, MBA, MPH, is a nationally known personal finance and health expert, speaker and award-winning author. Her articles and quoted advice have appeared in over 300 publications and websites, including Forbes, AARP retirement articles, AARP health articles, weightwatchers.com, Reuters, Money, NPR, Fodors, National Geographic, Scientific American, Health, Today, Harvard Public Health and The Atlantic.
Michelle Singletary selected three of her books as the book of the month in The Washington Post. She also co-created the 30-Day Precision Nutrition Challenge and recently authored the fourth version of Graduation Debt : How to Manage Student Loans and Live Your Life.
Reyna brings authority and empathy to all her writing. She has a Master’s of Business Administration in marketing and Master’s of Journalism from the University of North Texas and a Master’s of Public Health in Nutrition from the City University of New York.
