Do I need to sign up for Medicare if I’m a veteran with VA health care?

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Published February 23, 2023

You aren’t required to sign up for Medicare if you have health care coverage through the U.S. Department of Veterans Affairs (VA), but the VA encourages veterans to sign up for Medicare Part A and Part B during your initial enrollment period at 65, unless you also have group insurance from a current employer.

That way, you’ll have more options for care. VA health benefits provide coverage for care in VA clinics and hospitals, but the coverage generally doesn't extend to non-VA facilities and doctors.

Even if you’re happy with your VA health care benefits, your medical needs or the VA health system’s costs and coverage could change. If you want to sign up for Medicare later, you may have to wait to enroll and pay a late penalty.

How does Medicare work with VA health benefits?

VA health benefits and Medicare are two separate systems. VA health benefits cover services at VA hospitals and other locations within its system. Medicare doesn’t pay for the care.

VA health benefits typically won’t cover hospitals, doctors and other providers that participate in Medicare, nor will they cover Medicare deductibles, copayments and coinsurance. The rules are different for coordinating Medicare and Tricare for Life coverage for military retirees.

The VA occasionally pays for care from some providers not within its network, but only if you receive permission in advance. If the VA authorized only some services you need at a non-VA facility, Medicare can help with the additional costs.

Coverage varies. When you apply for VA health care, you’re assigned to a priority group that determines your coverage and out-of-pocket costs within the VA system. The ratings are designed to ensure that veterans who need immediate care are assigned quickly.

The groups range from a priority of 1 — for Medal of Honor recipients and veterans with service-connected illnesses or injuries rated to be at least 50 percent disabling — down to 8 — for veterans whose gross income exceeds VA limits and don’t have a service-connected disability qualifying them for VA compensation.

Your priority level can affect your eligibility for certain VA services and treatments, such as dental care. If you have a lower priority level, you may need to make copayments for doctor’s visits, specialty tests such as MRIs, and inpatient hospital stays not related to your service-connected disability.

For more information about the different kinds of health benefits available for veterans, active-duty service members and military retirees and their families, see AARP’s Veterans Health Benefits Navigator.

Think about the future. Even if you’re happy with your VA coverage, financing for the VA health care system could change, especially for veterans at lower priority levels.

Your health care needs could change, too. You might move to another area farther from a VA facility or want to go to a doctor outside the VA system.

If you don’t sign up for Medicare during your initial enrollment period at age 65, you may have to wait until the next general enrollment period that runs Jan. 1 to March 31 each year, and you may have to pay a late enrollment penalty. An exception: if you or your spouse is still working and you have health insurance from a current employer. In this case, you can choose to delay and not face a late enrollment penalty.

If I have VA drug coverage, do I need Medicare Part D?

You aren’t required to buy Medicare Part D prescription drug coverage if you have VA health benefits. VA prescription drug benefits are considered as good as or better than Medicare Part D, which the Centers for Medicare & Medicaid Services calls “creditable coverage.” You won’t have to pay a penalty if you decide to sign up for Part D later.

But VA health care only covers VA providers and pharmacies. Some people also sign up for Part D, so they can get prescriptions from doctors outside the VA and fill them at a nearby pharmacy.

Also, a Part D plan may cover different drugs than the VA and charge different copayments. VA copays for prescription drugs can vary by priority level. You can’t apply your VA and Part D benefits for the same expenses.

If you have VA drug benefits, you can sign up for a Part D plan without paying a late enrollment penalty any time after you enroll in Medicare Part A or Part B or within 63 days of losing VA drug benefits.

Keep in mind

Medicare has premiums, deductibles, copayments and other out-of-pocket costs. If your income and assets fall below certain levels, you may qualify for help with some of these expenses from a Medicare Savings Program. You also may be eligible for help with Medicare Part D premiums and copayments from the Extra Help financial assistance program.

Updated February 23, 2023

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