The term “healthy benefits” refers to pools of money made available to consumers to spend on health and well-being through public and private funding. Some of the programs funding healthy benefits have been around for decades, but new ones have rapidly proliferated in the last five years. Taking note of increased consumer awareness of these programs, insurers and employers are expanding their offerings. Common names for the programs include:
- Over the Counter (OTC)
- Health Benefit Cards (HBC)
- Grocery Cards
- Food is Medicine
In the US, healthy benefits are a large, fast-growing market. Based on an analysis of government records, Oliver Wyman1 estimates it reached $200 billion in 2023.
As this year gets underway, over 27 million Medicare Advantage enrollees will be receiving grocery benefits and Medicaid for groceries also referred to as Food is Medicine programs are coming online, which significantly expand the age and socio-economic demographics beyond Medicare Advantage recipients.
Unlike traditional insurance-funded healthcare and pharmacy transactions, which are processed as business-to-business payments, consumers pay for healthy benefits at the retail checkout. Account funds are typically accessed through what are called Approved Product Lists (e.g. restricted or filtered) payment account cards.
Technical Challenges and Identifying the Opportunity
POS Integrations
There are currently 5 main card processors in the market that administer the Medicare Advantage and Medicaid programs on behalf of the Health Insurers and US Government. These are: S3 (Solutran, ProHealth Connect and Soda Health), InComm, Nations Benefits, FIS PreNote and WorldPay. Historically, each of them requires a separate integration into a retailers Point of Sale (POS). Unlike the national chains which are dominated by Toshiba and NCR, the independents use a multitude of different POS providers. As a result, there have been a few POS integrations, but nothing that provides complete coverage.
AWG has been working with Fincretive, who provide a universal Gateway and turnkey solution for all the Health Benefit health plans and cards. It is a single integration into the POS connected to all of the processors. The POS systems that the Fincretive Gateway is available for are:
- NCR ENCOR
- Rorc
- RMH
- Upfront
- LOC (early Q2 2025)
- Toshiba ACE (Q2 2025)
Please connect with your respective dealer/POS vendor about the process involved for getting onboard and transacting with HBC/OTC/Grocery Benefit cards.
Approved Product List Basket Adjudication
Health Benefit cards are administered using Approved Product Lists (APL) that – through basket adjudication during a Health Benefit card transaction – validate the items in a basket that are eligible for purchase. The APLs themselves have been built using product files from national chains and as such independents have seen high numbers of declines, because their local type 2 and other PLU’s for example produce, do not match the APL.
Fincretive has developed a PLU mapping technique as part of the merchant onboarding process that significantly reduces declines, without requiring any changes to the way in which independents run their product files. AWG is working with Fincretive on a wider strategy around private label brands being included in the different APLs and will keep its members updated.
Please contact AWG or your respective dealer/POS vendor about the process involved for getting onboard and transacting with HBC/OTC/Grocery Benefit cards.
