Service members who leave active duty may qualify for health care coverage through either the Department of Veterans Affairs (VA) or TRICARE, depending on how they separated from the military. When Veterans turn 65, their options are based on if they’re VA or TRICARE for Life.
For most people who have worked and paid Social Security taxes for at least 10 years, Medicare Part A is free. However, Part B comes with a standard monthly premium ($174.70 for most people in 2024). If you choose not to enroll in Medicare during your Initial Enrollment Period and you don’t have employer-sponsored coverage, you may have to wait until the next General Enrollment Period (Jan. 1-March 31 each year) to enroll. You could also face a financial penalty of 10% of the Part B premium for each year you were eligible but went without, and you’ll be required to pay it for the rest of your life.
If you use VA benefits when you become Medicare eligible:
It's not mandatory to enroll in Medicare at age 65 if you’re a veteran with VA benefits. However, if you choose not to sign up for Medicare, you won’t have coverage for services you get in facilities outside the VA health system. Some veterans sign up for premium-free Medicare Part A (hospital insurance) but opt out of Part B (medical insurance) since it has an additional monthly premium. However, the VA strongly encourages veterans without employer-sponsored insurance to sign up for Medicare Parts A and B as soon as they qualify. Having VA benefits and Medicare gives you more choices for your care. With Medicare, you’re covered if you ever need to or choose to go to a non-VA hospital or doctor. There’s no guarantee the VA will have the funding to continue to cover all eligible veterans in the future. Medicare can give you peace of mind knowing that you’ll be able to get the medical care you need. Depending on your priority group, you may lack benefits for certain VA health services or have more out-of-pocket costs. Also, even if you’re satisfied with your current VA benefits, you might end up moving somewhere with less access to VA facilities, or decide you want to see a non-VA provider. Having Medicare can give you the added flexibility you need.
VA benefits and Medicare are separate systems and not coordinated in any way. Rather, you decide which benefits you want to use when receiving care. To use your VA benefits, you must visit a VA doctor or facility. In some cases, the VA will cover care at a non-VA facility if it’s pre-authorized. Medicare may step in to pay for services the VA has not authorized. To use your Medicare benefits, you must receive care at a Medicare-authorized facility. Your VA benefits will not cover your Medicare out-of-pocket costs.
If you have VA benefits and both Part A and Part B, you can choose either a Medigap/Medicare supplement plan or a Medicare Advantage plan to help you fill in the gaps in coverage. Not all Veterans receive the same Prescription Drug benefits so it’s important to find that out. Google Mary the Medicare Lady to see reviews from Veterans that are on these plans.
If You Have TRICARE When You Become Medicare-Eligible
As a military retiree, your coverage under traditional TRICARE ends once you become eligible for Medicare. If you have no group insurance from a current employer, you'll want to enroll in Medicare Parts A and B within three months before turning 65 to avoid any lapse in health care coverage. Enrolling in Medicare does not mean you’ll lose out on TRICARE benefits completely. Instead, you’ll switch to TRICARE for Life. This change is 100% automatic, so there's no need to fill out any special paperwork. If you are listed as TRICARE-eligible in the Defense Enrollment Eligibility Reporting System (DEERS), your TRICARE for Life coverage should begin on the same day as your Medicare Parts A and B coverage.
TRICARE for Life serves as “wrap-around” coverage for your Medicare plan and acts much like supplemental plans offered by private insurance carriers. Essentially, it enhances your existing benefits by reducing or eliminating out-of-pocket costs for many treatments, such as deductibles, coinsurance, and copayments. It may also pay for certain services not covered under Medicare, such as health care coverage outside the U.S.
It's important to note that TRICARE for Life is tied to the individual person; it does not extend to family members. If you have family members not eligible for Medicare, they will still be covered under their regular TRICARE plan.
Unlike Medicare and the VA, Medicare and TRICARE for Life coordinate benefits. With TRICARE for Life, you may see any participating or non-participating Medicare provider. You can get services at military hospitals and clinics if space is available. Medicare pays its share first, if any, and then TRICARE pays its share. In general, you'll pay nothing out of pocket for services covered by both plans. You may, however, have out-of-pocket costs for services not covered by TRICARE for Life and/or Medicare. This is one place Medicare Advantage plans may be able to help.
There's no special enrollment card for TRICARE for Life. You'll just need to show your uniformed military ID card and Medicare card as proof of coverage. You must have Medicare Part B to maintain coverage under TRICARE for Life, even if you’re still actively working. That's why it's important to enroll in Part B as soon as you become eligible. If you delay enrollment, you could face late enrollment penalties in addition to coverage gaps.
Enrollment in a Medicare Part D prescription drug plan isn't necessary if you have TRICARE for Life coverage, since TRICARE for Life beneficiaries are still covered under the TRICARE Pharmacy Program.
If you have TRICARE for Life, you do not need to purchase a Medigap/Medicare supplement as it serves as your Medicare supplement. Many Veterans that are on TRICARE for Life add a specially designed Medicare Advantage plan that does not include drug coverage. Google Mary the Medicare Lady to see reviews from Veterans that are on these plans.
These specially designed Medicare Advantage plans are for Veterans that are on Medicare Part A & B. These Medicare Advantage plans DO NOT interfere with nor affect eligibility of TRICARE For Life, VA Health Benefits, nor CHAMPVA. If you do not enroll in these plans when you’re first eligible, you can enroll Oct 15 – Dec 7, with an effective date of Jan 1. Please reach out to Mary the Medicare Lady to learn more about these plans. Veterans can also learn about their VA benefits by visiting their nearest VA Regional office, calling 1-800-827-1000, www.ebenefits.va.gov or www.va.gov/benefits.
Mary Hiatt is President of Mary the Medicare Lady (A non-government entity.) She offers Educational Workshops on Medicare, Drug Savings, and more at no charge. Not connected with or endorsed by the U.S. government or the federal Medicare program. Medicare Supplement insurance plans are not connected with or endorsed by the U.S. government or the federal Medicare program. See www.hiattagency.com or contact licensed independent agent mary [at] hiattagency [dot] com or call or text 402 672 9449 for more information.