Federal agencies should clarify that Medicare Advantage flexible benefit cards should not be considered income or assets when eligibility for federal assistance and benefits are calculated, 34 members of Congress told President Joe Biden in a letter on Friday.
The members of the Senate and House of Representatives, all Democrats, asked the president to direct the agencies to clarify the matter.
Some Medicare Advantage plans offer the flexible benefit cards, or flex cards, as a supplemental benefit, and the pre-loaded debit cards can be used “for specified purchases, usually for groceries, over-the-counter health expenses, and some utility payments,” the lawmakers said.
“Multiple instances” have occurred, however, in which consumers have been denied their full federal benefits, including affordable senior housing rental assistance, access to the Program of All-Inclusive Care for the Elderly and supplemental security income, because the flex cards have been included in some eligibility calculations, they wrote. LeadingAge previously specifically noted that Medicaid eligibility also has been imperiled. Eighteen percent of assisted living residents rely on Medicaid to pay for daily services.
“There appears to be a lack of clarity among entities that administer benefits as to whether Flex Cards qualify as an asset or income, resulting in different outcomes for consumers based on the individual determination by a particular agency eligibility worker, landlord, or other party,” the members of Congress told the president.
The letter-writers copied the heads of the Department of Health and Human Services, Department of Agriculture, Department of Housing and Urban Development, Social Security Administration and IRS on the communication.
LeadingAge President and CEO Katie Smith Sloan said Friday that the association appreciated the attention to the “critically important issue,” noting that settling the matter is “increasingly urgent” because Medicare open enrollment period begins Oct. 15.
Fifty-four percent of Medicare beneficiaries currently are enrolled in Medicare Advantage plans, LeadingAge noted in an online post last month, and “[s]ome older adults are unknowingly jeopardizing their eligibility for various government assistance programs — such as Medicaid, SSI, and federal rental assistance — because there is widespread confusion on whether flex card benefits should be included in income and/or asset calculations.”
Friday, Sloan said that the association had been sharing its concerns on the matter with the federal government “for months.”
“Time and again we hear stories of older adults of limited means enduring financial harm and negative health outcomes as a result of misunderstandings about Flex Cards,” Sloan said. “Low-income older adult residents in federally assisted housing communities have seen their rents improperly increased as a result of these benefits — even though the card was never used.” PACE participants also have been affected, she added.
LeadingAge previously had recommended that the flex cards be excluded from the calculation of income and assets for the purposes of determining eligibility for government programs, subsidy levels for federal housing assistance and the calculation of federal income taxes.
The association last month gave several examples of “potential impacts” on residents of affordable senior housing and PACE users.
In Florida, for instance, LeadingAge said: “An income-qualifying woman wanted to use the flex card to offset her rental payment in affordable housing. Her housing provider counted the benefit as income, which increased her rent under HUD rules. However, the housing provider’s rental payment system did not accept the flex card, meaning that the resident’s rent increased but she had no means to pay the additional amount.”
Elsewhere, the association said, “[a] HUD-assisted housing provider shared a story about a resident who reported that her daughter had enrolled the resident without her knowledge, and had fraudulently taken and used the flex card, and yet the resident’s rent payment increased because the benefit was considered the resident’s ‘income.’”
In multiple states, according to LeadingAge: “[s]everal affordable housing providers have stated that their residents report switching into MA plans with flex cards and receiving them in the mail, but not using them fearing it will impact their rent calculation if considered increased ‘income.’ In these cases, the value of the benefits does not roll over month-to-month when not used, which means that the resident did not have additional income or assets gained from the flex card’s now-expired benefits. However, the housing provider increased the residents’ rent simply because the benefit was issued to the resident, even though the card was never used and the benefit was not able to be accrued.”
In their Oct. 11 letter, the members of Congress said that “[c]onsumers should not be unfairly penalized due to a nominal benefit that cannot replace the services and assistance they receive from public programs.” Because the 2025 Medicare open enrollment period begins Oct. 15, they added, “it is imperative that this guidance be issued swiftly to protect consumers from unjustly being denied federal assistance.”
Signing the letter were US Sens. Sherrod Brown (D-OH) and Elizabeth Warren (D-MA) as well as US Reps. Julia Brownley (D-CA), Cori Bush (D-MO), André Carson (D-IN), Troy Carter (D-LA), Joaquin Castro (D-TX), Sheila Cherfilus-McCormick (D-FL), Steve Cohen (D-TN), Shontel M. Brown (D-OH), Danny K. Davis (D-IL), Lloyd Doggett (D-TX), Dwight Evans (D-PA), Jesús G. “Chuy” García (D-IL), Sylvia R. Garcia (D-TX), Al Green (D-TX), Raúl M. Grijalva (D-AZ), Val Hoyle (D-CA), Barbara Lee (D-CA), Seth Magaziner (D-RI), Betty McCollum (D-MN), Joseph D. Morelle (D-NY), Eleanor Holmes Norton (D-DC), Mark Pocan (D-WI), Katie Porter (D-CA), Delia C. Ramirez (D-IL), Jan Schakowsky (D-IL), Terri A. Sewell (D-AL), Mark Takano (D-CA), Shri Thanedar (D-MI), Rashida Tlaib (D-MI), Juan Vargas (D-CA), Nikema Williams (D-GA) and Frederica S. Wilson (D-FL).
