Medicare Advantage enrollees who receive quarterly debit cards for groceries and drugstore purchases face a quiet deadline: unspent dollars on those cards typically expire at the end of each calendar year. The Centers for Medicare and Medicaid Services has responded with new rules requiring plans to send personalized mid-year notices between June 30 and July 31, listing any supplemental benefits a member has not used in the first six months. Separately, CMS has flagged ongoing confusion about what these cards can actually buy and where they work, and the agency has proposed restricting how insurers market card dollar amounts in their advertising.
CMS Mid-Year Notice Rule and the Use-It-or-Lose-It Problem
The core tension is straightforward. Insurers promote quarterly-loaded debit cards as a selling point during enrollment season, but many cardholders never fully spend the balances before they reset. CMS addressed this gap in its 2025 final rule, which established that every MA plan must issue a personalized mid-year notification of unused supplemental benefits annually between June 30 and July 31. The notice must list specific benefits a member has not accessed during the first half of the year, giving enrollees a concrete reminder before the remaining quarters slip by.
This requirement signals that unused supplemental benefits are common enough to warrant a federal intervention. CMS framed the mid-year notice as a way to help beneficiaries understand and use the extra benefits they are already entitled to, rather than allowing those dollars to quietly expire. Plans that have historically relied on the appeal of debit cards at the point of sale may now face closer scrutiny over whether members actually benefit from those offerings once enrolled.
One testable question is whether plans that comply effectively with these notices will see measurable shifts in enrollment patterns by 2026, as beneficiaries become more aware of what they are leaving on the table and potentially switch to plans whose benefits they would actually use. Public CMS enrollment files could eventually show whether notification compliance correlates with retention or churn, though no aggregate data on forfeited debit-card dollars has been published. For now, the mid-year notice rule mainly underscores that “use it or lose it” has become a policy concern, not just a consumer frustration.
Stakeholder Confusion and Proposed Marketing Restrictions for 2026
The debit cards themselves remain a source of friction. In its 2026 proposed rule, CMS acknowledged that stakeholders have requested clarity about debit cards, including what can be purchased and where or how cards can be used. Plans use different vendors, networks, and product lists, which means two cards advertised in similar language can function very differently at the register.
That same proposal floated limits on marketing the dollar value or administration method of benefits such as debit cards, a direct response to advertising practices that emphasize flashy card amounts without spelling out spending restrictions. CMS signaled concern that dollar figures in television spots, mailers, and online ads can overshadow the fine print about eligible retailers, product categories, and quarterly expirations. By tightening those rules, the agency aims to ensure that beneficiaries are not choosing plans on the basis of card balances they will never realistically be able to use.
The practical effect for enrollees is significant. A card marketed as carrying a certain quarterly balance for “groceries and over-the-counter items” may only work at specific retailers, cover a narrow list of approved products, or exclude common purchases a beneficiary expects to make. When the rules governing these cards are buried in plan documents, members often discover the limitations only after a declined transaction at checkout. CMS is trying to close that information gap before it shapes enrollment decisions built on incomplete expectations, and the proposed marketing restrictions are one way to rebalance how these benefits are presented.
What Enrollees Still Cannot Easily Find Out
Several important questions remain unanswered in the public record. CMS has not released aggregate figures on how many dollars in debit-card benefits go unused each year across all MA plans. No official enrollment or claims dataset breaks out how many beneficiaries specifically receive quarterly grocery and drugstore cards versus other types of supplemental benefits. And while the agency has acknowledged consumer confusion about how debit cards work, there is no standardized, consumer-facing database where a beneficiary can compare card rules across plans in a uniform format.
The Federal Register filing for the 2025 rule highlights CMS’s broader effort to tighten oversight of supplemental benefits, but it does not quantify the scale of unused balances or detail which populations are most affected. Advocates have raised concerns that beneficiaries with lower incomes or limited mobility may be especially likely to miss out on card dollars if they lack convenient access to in-network retailers or clear instructions on eligible items.
For now, enrollees who want to avoid forfeiting card funds must rely on plan-specific materials, customer service lines, and the new mid-year notices to understand their options. The evolving rules from CMS suggest that more transparency is coming, particularly around marketing practices and the clarity of benefit descriptions. Until then, the quiet expiration of unused grocery and drugstore card balances remains a largely invisible feature of the Medicare Advantage marketplace, one that regulators are only beginning to bring into full view.
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