The Veterans Administration suggests all vets sign up for Medicare when they're eligible - even if they have VA coverage.
Even if you already have health coverage through the U.S. Department of Veterans Affairs (VA), it's recommended that you sign up for Medicare when you're eligible. You are not required to do so, but there are several benefits to having both VA and Medicare coverage.
Just as with non-veterans, you can enroll in Medicare if you're 65 or older or if you have a qualifying disability, ALS, or end-stage renal disease (ESRD).
To get more information about your specific circumstances or to learn about VA and Medicare benefits, you should speak with a VA representative for more information at 1-877-222-VETS (8387) or online at va.gov.
Can you have both VA healthcare and Medicare?
You can have both VA healthcare and Medicare, and in fact, the VA encourages you to sign up for Medicare as soon as you can. There are a few reasons for this:
- VA coverage isn't always guaranteed: The VA assigns you to different priority levels based on a variety of factors. If there isn't enough government funding in the future to provide care to all Veterans with VA healthcare and you're in one of the lower priority groups, you could lose your VA coverage. Having Medicare as well will ensure you always have coverage you'll need.
- Wider coverage: The VA pays for services if you go to a VA hospital or doctor. If you have Medicare, you're covered if you go to a non-VA provider. This gives you more options to choose from and prevents you from having to pay the full cost out-of-pocket for medical services outside of Veterans Affairs.
- Penalties: If you don't enroll in Medicare B when you're eligible and you lose VA coverage or decide to enroll in Part B later, you may have to pay a late enrollment penalty every month that you have Part B in the future. To avoid those penalties altogether you should enroll in Part B when you're eligible.
- Drug coverage: If you also enroll in Medicare Part D prescription drug coverage, you can get prescriptions from non-VA doctors and fill them at non-VA pharmacies. Enrolling in Part D is not required if you have VA coverage but doing so may give you more options.
How much does Medicare cost?
The out-of-pocket expenses you may have with Medicare include:
- Premium: Paid monthly
- Deductible: The amount you must pay out-of-pocket before Medicare starts to cover costs
- Co-pay: A flat fee you pay for covered services
- Co-insurance: The percentage of costs you pay after reaching your deductible
Part A Costs
Monthly premium: You do not have a monthly premium for Part A coverage if you or your spouse paid Medicare taxes for at least 10 years (40 quarters) while working.
If you have not paid the applicable taxes, you may purchase Part A coverage if you’re 65 or older and have or are enrolling in Part B coverage. You must also be a U.S. citizen or legal permanent resident. If you paid Medicare taxes for less than 30 quarters (7.5 years), you’ll pay up to $506 per month in 2023. If you paid for 30-39 quarters (7.5-9.75 years), you’ll pay $278 per month.
Deductible: In 2023, the Part A deductible is $1,600 per benefit period. You must pay this much out-of-pocket before Medicare kicks in and contributes to medical costs.
Co-pays and co-insurance: With Part A coverage, you owe a co-pay for hospital stays, skilled nursing home stays, or hospice care. In most cases, these co-pays are covered by Medicare. One exception is if you’re in hospice, you may have a co-pay for prescription drugs you receive.
However, you may have co-insurance costs with Part A depending on the length of your stay in a hospital or covered facility. This includes:
- $0 for days 1-60
- $400 per day for days 61-90
- $800 per each day after day 90 (up to 60 lifetime reserve days)
Beyond lifetime reserve days, you are responsible for all costs.
Part B Costs
Monthly premium: In 2023, the standard monthly premium for Part B coverage is $164.90. If your income (as reported on your IRS tax return from two years prior) is above $97,000, you may pay a higher premium.
Deductible: The Part B deductible is $226 per year (in 2023). You must pay this much out-of-pocket before Medicare begins paying its share.
Co-pays and co-insurance: Part B usually only has co-payments when you get outpatient hospital or mental health services.
Co-insurance is typically 20% of the Medicare-approved amount for:
- Most doctor services (including medically necessary services and preventive services)
- Outpatient therapy
- Durable medical equipment (DME)
With Original Medicare, doctors who accept assignment agree to accept the Medicare-approved amount as full payment for covered services. In some cases, this could be less than the usual amount the doctor charges. Medicare would cover part of this amount (typically 80%) and you’d pay the remaining cost (typically 20%).
How your VA benefits and Medicare work together
If you have both VA and Medicare benefits, how services are covered typically depends on where you get care.
For services to be covered by the VA, you must go to a VA facility. Or, to get coverage for services at a non-VA facility, you must get prior authorization from the VA.
If you go to a non-VA facility, your Medicare coverage applies. Part A (hospital care) and Part B (medical care) would likely cover the services and supplies you'd need for either inpatient or outpatient care. Or, if you received prior authorization, the VA would pay for some services and Medicare may pay for others.
When you enroll in Medicare, you should inform the VA that you have that coverage. They can help you understand how the benefits work together.
Do TRICARE and Medicare work together?
If you're active-duty and enrolled in both Medicare and TRICARE, TRICARE will pay for your claims first and Medicare will pay second. This means that Medicare may pay for services and supplies that TRICARE doesn't.
If you're retired from active duty, Medicare is the primary payer, meaning they pay first and TRICARE would pay second. The exception is if you receive services from a military healthcare provider. In that case, TRICARE would pay first and Medicare would pay second.
When is the best time to sign up for Medicare?
You should sign up for Medicare Part A and Part B as soon as you are eligible.
To be eligible for Medicare, you must be 65 or older or have a qualifying disability. In that case, you're eligible if you collect Social Security or Railroad Retirement Board (RRB) disability benefits for 24 months. You're also eligible if you have ALS or ESRD.
The best time to enroll in Medicare is during your Initial Enrollment Period (IEP). Your IEP is a 7-month period that begins 3 months before the month you turn 65, includes your birthday month, and ends 3 months later.
Or, if you qualify for Medicare because of a disability, your IEP begins in month 22 of collecting disability benefits and ends in month 28. In some cases, you're automatically enrolled in Part A and Part B, but you should check with Medicare to ensure you follow the right steps.
By enrolling in Medicare when you're first eligible you avoid late enrollment penalties and gaps in coverage.
Do you need Medicare Advantage if you have VA benefits?
Medicare Part C, or Medicare Advantage (MA) plans, offer the same coverage as Original Medicare Part A and Part B. Many plans also provide additional benefits like prescription drug coverage, vision, hearing, and dental.
Whether to enroll in an MA plan if you have VA benefits is a personal choice. You may decide you don't need MA coverage since you already have prescription drug coverage through the VA, or you may determine the other benefits MA plans offer, like dental and vision, are worth it.
If you choose to enroll in an MA plan, be sure to look for one with a $0 monthly premium. MA plans are offered by private insurance companies so costs and coverage can vary depending on the plan you choose and where you live. You'll also likely have a deductible, as well as co-pays or co-insurance costs associated with MA coverage. You also must still pay the Medicare Part B premium.
Do you need Medicare Part D if you have VA benefits?
Medicare Part D is prescription drug coverage. It's not included with Original Medicare and you must enroll in a stand-alone Part D plan in order to get the coverage. Or, you may receive drug coverage through a Medicare Advantage plan.
Drug coverage is also included in your VA benefits, so it's not required to enroll in a Part D plan if you have VA benefits. However, you may find it's beneficial to do so. Enrolling in a Part D plan allows you to get prescriptions from non-VA doctors and fill them at non-VA pharmacies or facilities. Part D may also cover drugs not covered by your VA plan.
If you do join a Medicare Advantage plan, be sure to consider one that includes Part D coverage.
Either way, you should compare drug formularies carefully and review which pharmacies are in- and out-of-network.
Do you need a Medigap plan?
Medicare Supplement plans, or Medigap, help to fill the "gaps" in Medicare in terms of out-of-pocket costs and some coverage. For example, many Medigap plans include coverage for care received in another country, so if you travel extensively, you may want to consider a Medigap plan.
If you plan to rely more on your Medicare coverage than your VA coverage, such as if you'll be going to non-VA doctors and hospitals, a Medigap policy can help pay for some of those out-of-pocket expenses that aren't covered by Medicare.
On the other hand, if you'll be using your VA coverage more than Medicare, you likely don't need a Medigap policy.
The Medigap Open Enrollment Period (OEP) is the best time to enroll in a Supplement plan. Your OEP begins the day you're both 65 or older and enrolled in Medicare Part B and lasts for six months. During this time, you're guaranteed a Medigap plan and are not subject to medical underwriting.
Outside of your OEP, your application typically does go through medical underwriting, which means they take into consideration factors such as your age, current health, and medical history. This could result in the company denying you coverage or charging you more for a policy.
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