PolicyScout’s Guide to Veterans and Medicare

PolicyScout’s Guide to Veterans and Medicare
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PolicyScout’s Guide to Veterans and Medicare

PolicyScout’s Guide to Veterans and Medicare
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If you or a loved one is retiring from the military or reaching the age of 65, you’ll probably want to know how Medicare works with VA benefits and TRICARE coverage.

Learn about the different health coverage options available to veterans and former members of the US armed forces with our guide to Medicare, veterans, and retired service members.

What Is Medicare?

Medicare is a federal health program for qualifying people in the U.S. This Medicare program gives members access to affordable health care options and helps pay for medical expenses.

You qualify for Medicare:

  • If you are a US citizen or legal resident of the U.S for at least five years.

  • If you are 65 or older.

  • If you are turning 65 in the next three months.

You can also qualify for Medicare at any age if you suffer from:

  • ESRD (End-Stage Renal Disease) 

  • ALS (Lou Gehrig’s Disease).

  • If you have been receiving SSDI (Social Security Disability Insurance) for at least 24 months.

How Does Medicare Work?

Medicare is divided into three parts that separate costs, coverage, and benefits.

Part A deals with hospital health cover and medical costs people incur as inpatients of a hospital or skilled nursing facility.

Part B covers outpatient treatment, preventative care, and durable medical equipment. This is sometimes known as general Medicare coverage because it deals with most types of medical expenses.

For example, Part B expenses can include doctor’s visits, scans, screenings, tests, and out-of-hospital treatments.

Part D relates to self-administered prescription drug coverage and includes any medication, pills, drugs, or treatment that beneficiaries take on their own.

For example, high blood pressure tablets, diabetic medication, and chronic pain pills are all Medicare Part D expenses.

Health Coverage for Veterans

Veterans and members of the U.S. armed forces are mainly covered for medical expenses through TRICARE and VA health benefits. Let’s take a look at both these options in more detail.

What Are VA Health Benefits?

The Department of Veteran Affairs provides education, financial, housing, and health assistance to veterans of the U.S. armed forces. These are collectively known as VA benefits or VA coverage.

You are eligible for VA health coverage if you are serving or served on active duty in:

  • The United States uniformed services, the National Guard, or the US Armed Forces Reserve (and received federal pay). 

You are also eligible for some VA benefits if you are serving or served as a traditional or technical member of the National Guard or the US Armed Forces Reserve.

If you qualify for VA benefits, you can get access to:

  • Inpatient and outpatient care at VA facilities. 

  • Prescription drug coverage from VA providers.

  • Long-term care (depending on your needs, income, and space availability) at VA facilities.

  • Mental health care at VA facilities.

  • Women veterans health care.

If you have VA benefits, you can sign up for Medicare, Medicare Advantage, Medicare Supplement Insurance, or a Part D prescription plan.

An older member of the U.S. navy in uniform who has VA benefits

(Source: Pexels)

Do I Need Medicare If I Have VA Coverage?

Enrolling in Medicare is optional. However, there are advantages to signing up. If you have VA coverage, here are a few points to consider:

1. The VA health system isn’t as widespread as Medicare in the U.S. With VA benefits, you’ll only be able to get medical services, tests, and items at VA hospitals and treatment facilities. In 2021, there were 170 VA Medical Centers and 1,063 outpatient clinics that served 9 million veterans across the U.S.

If you live far away from the nearest VA medical facility, it may be difficult to access health care as you get older. When you join Medicare, you will be able to go to any doctor or hospital that accepts Medicare enrollees.

In 2020, around 1% of physicians across the U.S. formally opted out of Medicare. This is not to say that all doctors will accept Medicare beneficiaries. However, if you’re a veteran using VA benefits you will have more health care options if you join Medicare.

2. You’ll also only get free VA coverage for illnesses or injuries that are service-connected (related to your military service). Non-service-connected treatments, tests, and services aren’t free and veterans are usually charged a copay.

The amount of your copayment for services at VA treatment centers depends on your priority group. Your priority group is based on:

  • Your military service history.

  • Your disability rating.

  • Your income.

  • Whether or not you qualify for Medicaid (health coverage for eligible low-income individuals).

  • Other benefits you may be receiving (like VA pension benefits).

Key Point: Service-connected vs Non-service-connected

Service-connected: These are any health conditions, injuries, or diseases a person sustained, contracted, or aggravated by service in the United States armed forces.

Non-service-connected: These are health conditions, injuries, or diseases that a person sustained or contracted which aren’t related to their military service in the United States armed forces.

With Medicare, these factors won’t influence the amount you have to pay for medical services, tests, and items. 

If you join Medicare Part A you’ll get complete hospital coverage for up to 150 days in your life, and you’ll only have to pay a flat coinsurance amount after Day 60.

Medicare Part A Coinsurance Amounts (2022)

Days Cost per day
Day 1 - 60 $0 per day.
Day 61 - 90 $389 per day.
Day 90 - 150 $778 per day.

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Medicare Part B will cover 80% of approved medical expenses, and you will have to pay the remaining 20%.

For example, if you get X-rays done and the bill comes to $500 Medicare will pay $400 (80%), and you will have to pay $100 (20%).

Joining Medicare can help veterans lower their medical expenses, improve access to health care services, and enhance their overall quality of medical care. This coverage can even be enhanced with a Medicare Advantage plan and Medicare Supplement Insurance.

Terms you should know:

Coinsurance: These are a portion of the costs you will have to pay for medical expenses such as tests, services, and items.

Deductibles: These are minimum costs that need to be covered before a health care plan starts to pay.

Copayments: These are fixed amounts that you pay for services, tests, and items. For example, you might be charged a $15 copayment if you go to the doctor.

A smiling older member of the U.S. armed forces who has just joined Medicare.

(Source: Pexels)

What Is TRICARE?

TRICARE is a medical insurance scheme for current and retired US armed forces members and their families. TRICARE is similar to a Health Maintenance Organization and is managed by the Department of Defense. 

Key Point - What is a Health Maintenance Organization?

Health Maintenance Organization (HMO plan) gives its members health insurance through a healthcare provider network (doctors, medical practitioners, and medical facilities that join the insurance scheme). People on HMOs are only covered for service in-network.

TRICARE for Life

TRICARE has a specific health plan for Medicare-eligible individuals called TRICARE for Life. TRICARE for Life is wraparound coverage for Medicare. This means that once you enroll in this plan, the two programs work together to cover medical costs.

If you’re a TRICARE member, once you turn 65 you’ll be enrolled in the TRICARE for Life plan and will need to join Medicare Part A and B.

If you are a TRICARE member younger than 65 and eligible for Medicare because of a disability or illness, you can also get TRICARE for Life. For more information on qualifying for Medicare, read our Medicare eligibility guide.

With the TRICARE for Life plan, members will have to pay the Medicare Part B monthly premium. This premium is based on your income, and in 2022 the average Part B premium is $170.10 per month.

You might have to pay a premium for Part A coverage if you haven’t contributed towards Medicare through payroll taxes for at least forty financial quarters (around ten years).

If you do not qualify for premium-free Medicare Part A cover, you don’t have to join TRICARE for Life and you might be able to continue on your current TRICARE plan.

Once you’re enrolled in TRICARE for Life your medical provider will bill Medicare first, and then TRICARE will cover the remaining approved costs.

Type of Service Medicare Pays TRICARE Pays You Pay
Covered by TRICARE and Medicare Medicare-Approved Amount The Remaining Amount Nothing
Covered by Medicare only Medicare-Approved Amount Nothing Medicare Deductible And Coinsurance Amounts.
Covered by TRICARE only Nothing Tricare-Approved Amount Tricare Deductible And Coinsurance Amounts.
Not covered by TRICARE or Medicare Nothing Nothing Billed Charges

Do Veterans Have to Enroll in Medicare?

The federal Medicare program is optional, but if you don’t enroll once you become eligible you might have to pay a late-enrollment penalty for Medicare Part A and Part B.

Key Point - Medicare Late Enrollment Penalties for Medicare Part A and B

If you don’t qualify for premium-free Part A and sign up late, you’ll have to pay a 10% penalty for each year that you weren’t enrolled. You will have to pay this penalty for twice the length of time that you didn’t sign up.

For example, if you only enroll in Medicare Part A when you turn 68 (three years after you become eligible for Medicare), you’ll have to pay the 10% penalty on top of your monthly premium for six years.

For Part B, the penalty is 10% for each 12-month period you weren’t enrolled and you will have to pay this penalty on top of your monthly Part B premiums for the rest of your life.

For example, if you enrolled in Part B when you turn 70 you will have to pay a 50% Part B penalty.

If your monthly Part B premium is $170.10, you’ll have to pay an extra $85.05 each month to keep your Part B coverage. (Total: $255.15 per month).

If you have VA benefits, you don’t have to enroll in Medicare to keep them. However, joining Medicare will give you access to medical care outside of the VA network of hospitals and clinics.

VA benefits and Medicare are separate health coverage options and don’t work together. This means your VA benefits will not cover your Medicare costs and Medicare will also not cover VA provider costs.

If you have TRICARE, you will have to join Medicare when you turn 65 to keep your coverage. TRICARE and Medicare work together, which means that both plans will cover approved costs and expenses.

A group of veterans smiling because TRICARE and Medicare work together.

(Source: Pexels)

Other Health Coverage Options for Veterans

If you have VA benefits, aren’t a member of TRICARE, and would like to lower your health care costs, joining Medicare is a great option.

Veterans can also buy a Medicare Advantage plan or Medicare Supplement Insurance plan just like anyone else. Let’s take a closer look at the benefits of these plans for veterans:

Medicare Advantage Plans and Veterans

Medicare Advantage plans are health care policies offered by private health insurance companies. These plans have the same benefits as Original Medicare and provide additional benefits and health care coverage for dental, vision, and hearing expenses.

In 2021, more health care insurance providers are offering tailored Medicare Advantage plans for veterans and former service members.

For example, UnitedHealthcare offers Medicare Advantage plans for veterans in 46 states, and Aetna has a Medicare Advantage plan for veterans in 41 states.

Joining a Medicare Advantage plan as a veteran can give you more benefits while paying the same rates as Original Medicare.

That’s because many Medicare Advantage plans have low monthly costs, and some even have $0 monthly premiums. 

You’ll also get access to your Medicare Advantage provider’s network of doctors, hospitals, and specialists and pay reduced rates for services, tests, and items.

If you’d like to learn more about private Medicare coverage for veterans, reach out to one of PolicyScout’s experienced consultants and ask about your options. 

Key Point - The Benefits of Enrolling in Medicare Advantage as a Veteran

  • You’ll get access to more hospitals and treatment centers across the U.S.
  • VA Health Care Benefits can change based on federal funding levels.
  • A Medicare Advantage plan might cost the same price as Original Medicare ($0 monthly premium plans).
  • If you’re unhappy with your level of care or service, you can change plans.

Medicare Supplement Insurance and Veterans

Medicare Supplement Insurance plans, also known as Medigap plans, offer coverage for costs that Original Medicare doesn’t pay for, such as coinsurance, excess charges, deductibles, and copayments.

Terms you should know:

Coinsurance: These are portions of medical costs that you must pay for medical treatments, services, and tests.

Excess Charges: These are costs that go over the Medicare-approved limits for services, tests, items.

Deductibles: These are amounts that you must pay before your medical insurance begins to cover your treatment costs.

Copayments: These are fixed fees for medical tests, items, and services that are set by Medicare or a health insurance company. 

They also can provide additional benefits such as extended hospital cover, foreign travel emergency cover, and hospice care.

Medicare Supplement Insurance plan benefits are standardized in 47 states across the U.S. There are twelve plans that offer different levels of coverage for medical costs.

If you want to learn more, check out our guide to Medicare Supplement Insurance or speak with one of PolicyScout’s Medicare consultants at 1-888-912-2132.

A female soldier who is happy with her Medicare Supplement Insurance plan

(Source: Pexels)

Medicare Part D and Veterans

If you are a veteran, your Medicare Part D (Prescription Drug Coverage) expenses are usually paid through TRICARE or VA Health Care Benefits.

Unless you take specific medication that isn’t covered under the VA health system or TRICARE, you probably won’t need to take out Part D insurance.

If you’re wondering about Part D coverage for veterans, it’s best to speak with a licensed insurance agent to find out what kind of coverage you need.

How Can I Find Out More about My Health Care Options?

Learning about your Medicare benefits, costs, and coverage can help you make an informed decision about your health care. 

If you have VA benefits and want to find out about the federal Medicare program, Medicare plans, or private health insurance, visit our Medicare Hub.

We also have a team of Medicare consultants who can answer your questions and provide information about VA benefits and Medicare.

Call us at 1-888-912-2132 or send an email to Help@PolicyScout.com to get started.

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