Medicare is the United States’ public health insurance program for individuals aged 65 and older and for individuals with disabilities or certain chronic conditions. Medicare operates in four parts:
Part A
Hospital
Insurance
Part B
Medical
Insurance
Part C
Medicare
Advantage
Part D
Prescription
Drug Coverage
Medicare participants can choose to enroll in Original Medicare (i.e., Medicare Parts A and B), and receive their coverage directly from the federal government, or Medicare Advantage (Medicare Part C), and receive their coverage via a health plan that contracts with the federal government to administer Medicare benefits.
Is there a requirement?
Medicare law, regulations, and coverage determinations establish a standard set of covered benefits that must be covered in both Original Medicare and Medicare Advantage (MA) plans. As of December 2025, FIM services are not included within these standard benefits.
Are there voluntary pathways?
MA plans may offer additional services—beyond these standard benefits—to their enrollees. These additional benefits are known as General Supplemental Benefits and Special Supplemental Benefits for the Chronically Ill (SSBCI).
Path 1: General Supplemental Benefits
Goal:
MA plans may offer services that are:
- Not covered by Original Medicare,
- “Primarily health related,” and
- For which the plan incurs a direct medical cost as general supplemental benefits.
Purpose:
Benefits must be offered to all plan enrollees or a targeted subset of enrollees with the same health status or disease state.
Allowance:
Current Medicare manuals allow coverage of meals as a supplemental benefit when: (1) offered for short duration and (2) offered after surgery or inpatient stay or as part of a supervised program to transition to lifestyle change for a chronic condition. However, Medicare guidance indicates that other nutrition supports (such as food and produce) are not considered “primarily health related” and therefore cannot be offered as general supplemental benefits.
Availability:
In 2025, roughly 70% of enrollees in individual Medicare Advantage plans were in plans that offered a short-term meal benefit.
Path 2: Special Supplemental Benefits for the Chronically Ill (SSBCI)
Goal:
Since 2020, MA plans have also had the option to offer Special Supplemental Benefits for the Chronically Ill (SSBCI) to individual enrollees with one or more comorbid and medically complex chronic conditions that:
- Are life threatening or significantly limit the overall health or function of the enrollee;
- Has a high risk of hospitalization or other adverse health outcomes; and
- Requires intensive care coordination.
Purpose:
SSBCI are not required to be “primarily health related”, unlike general supplemental benefits. Instead, they must only have “a reasonable expectation of improving or maintaining the health or overall function of the enrollee.”7
Allowance:
CMS guidance states that plans may offer both meals beyond a limited basis and food and produce as SSBCI. However, plans are specifically prohibited from providing “non-healthy food” as SSBCI.
Availability:
As of 2025, 3% of enrollees in individual Medicare Advantage plans were in plans that offered meals beyond a limited basis, while 13% (and 94% of individuals in Special Needs Plans) were in plans that offered food and produce as SSBCIs.
MA plans interested in implementing these voluntary pathways to cover FIM services may do so by including them in their Plan Benefit Package (PBP) submitted each year as part of the Medicare Advantage Bid Process.
However, FIM services are not paid for out of the bid amount. Plans finance supplemental benefits, including SSBCI, through rebate dollars paid to the plan by Medicare.
A Note on Value-Based Payment Models
Individuals enrolled in Original Medicare typically do not have access to FIM services, as they are not part of standard Medicare benefits. However, CMS currently operates certain value-based payment models (i.e., models that seek to reward health care providers based upon quality of care) that may provide participating health care providers with additional voluntary pathways to deliver FIM services to Medicare enrollees. For example, in January 2027, CMS will launch the Long-term Enhanced ACO Design (LEAD) Model. This model—which will replace the currently operating REACH Model—will operate via accountable care organizations (ACOs) (i.e., entities made up of health care providers that work together to improve outcomes and control costs) and will use risk adjustment, financial risk-sharing, and healthy living flexibilities to improve outcomes and control costs.
As part of these healthy living flexibilities, some ACOs will be able to offer Medical Nutrition Therapy (MNT) for a wider range of diet-sensitive health conditions than typically allowed in Original Medicare. ACOs will also be able to offer Beneficiary Engagement Incentives (BEIs), including “healthy food products to support beneficiaries’ health as beneficiaries engage in healthy living activities (e.g., exercising) and participate in evidence-based programs that support the prevention and management of chronic diseases.”
Notably, value-based payment models are not exclusive to Medicare. ACOs and other similar models also exist in Medicaid and commercial markets (see e.g., discussion of Massachusetts’ Medicaid ACOs above).
Are grocery cards provided as supplemental benefits considered income?
The value of grocery cards provided via MA general supplemental benefits or SSBCI is not considered taxable income for the MA enrollee/recipient as long as the plan/provider is providing services consistent with the rules for supplemental benefits.
Importantly, CMS notes that the restricted spend financial instrument, such as a voucher, coupon, or debit card, is only the means by which the MA plan is making a direct payment to the provider or reimbursement to the enrollee for covered items and services.
Similarly, under federal guidance, the value of these “regularly issued spending cards limited to certain covered items or services,” including food, provided under MA supplemental benefits programs, is excluded from what is counted as income when determining eligibility for the Supplemental Nutrition Assistance Program (SNAP).
For more information regarding income tax implications, see this resource from The Nutrition Incentive Program Training, Technical Assistance, Evaluation, and Information Center (NTAE).
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