Medicare Advantage plans have become a favored alternative to the original Medicare program due to their bundling of multiple services into one package, often providing more comprehensive coverage options for retirees. However, beneficiaries enrolled in these plans should be aware that new regulatory changes will take effect beginning in 2026, potentially altering the landscape of covered benefits.
Central to this update are modifications to the Special Supplemental Benefits for the Chronically Ill (SSBCI), a program established alongside the Bipartisan Budget Act of 2018. This program expanded supplemental benefits available to Medicare Advantage enrollees managing chronic health conditions.
The SSBCI is distinctive in that it covers goods and services which may not have a direct medical correlation but are reasonably expected to enhance or sustain the overall health or functionality of individuals with chronic illnesses.
Looking ahead to 2026, the Centers for Medicare and Medicaid Services (CMS) announced new restrictions delimiting what can be provided under SSBCI. Specifically, CMS outlined a list of goods and services that Medicare Advantage plans will no longer cover as part of these supplemental benefits.
Items and services excluded under the new guidelines include:
- Alcohol, tobacco, and cannabis products
- Life insurance and hospital indemnity insurance
- Funeral planning and expenses
- Purely cosmetic procedures such as facelifts
- Broad membership programs that offer products or services unrelated to health
- Non-healthy food items
While several restrictions are clearly defined, certain aspects retain elements of ambiguity. For instance, CMS has refrained from specifying which foods constitute "non-healthy" items in the context of grocery benefits. Instead, CMS entrusts individual Medicare Advantage plans with the responsibility to determine allowable foods within their benefits offerings. Plans must design food benefits geared toward meeting the nutritional needs of enrollees suffering from chronic illnesses.
CMS also emphasized that the list provided is not exhaustive. Individual plans must propose their benefits offerings through annual bids subject to CMS review, which could result in further adjustments to covered items or services in the future.
For Medicare Advantage enrollees, these changes mean a potential reduction in the types of supplemental benefits accessible through their plans. Because coverage specifics can vary by plan, beneficiaries are advised to consult their current plan details for exact coverage information regarding SSBCI benefits for 2026.
It is worth noting that some exclusions, such as those pertaining to cosmetic surgeries and life insurance policies, reflect existing norms since these services generally are not covered by Medicare Advantage plans. The new rules formalize and possibly expand these boundaries.
With these developments, some retirees might encounter higher out-of-pocket expenses next year. This risk accentuates the importance of budgeting adequately for healthcare needs and reassessing insurance coverage to safeguard financial stability.
Overall, as the Medicare Advantage program evolves, beneficiaries managing chronic illnesses may face adjustments to the supplementary benefits they have come to rely upon. Staying informed of these regulatory changes and understanding individual plan nuances will be crucial to navigating benefits and costs effectively going forward.