Confused about healthcare benefits through the U.S. Department of Veterans Affairs (VA)? You’re not alone. Understanding how VA healthcare benefits work with Medicare can be a challenge for anyone.
Below is some information on how VA benefits work and what happens when someone with VA healthcare coverage becomes eligible for Medicare.
Am I eligible for VA healthcare coverage?
It depends. If you have served on active duty in the armed forces and meet certain criteria, you may apply for VA healthcare coverage. Eligibility criteria include:
- Length of service
- Service-connected disabilities
- Income level
- Available VA resources
If the VA determines that you qualify for healthcare coverage, you will be assigned a priority level based on a scale of 1 to 8—1 being the highest priority and 8 being the lowest.
For example, if you are considered a priority level 8, you will get far less coverage and slower access to care than if you were a priority level 1 or 2. In general, the more you need healthcare coverage due to a combination of service-related disability and low income, the more coverage you will get from the VA.
What are priority levels, and how do they affect VA healthcare coverage?
Priority levels are an important part of VA coverage. Your priority level determines what type of health benefits you will receive. It also may determine when you will be scheduled for medical care or, if necessary, your placement in a VA long-term care facility.
What type of benefits does my VA coverage offer?
If you qualify for VA health benefits, regardless of what priority level you are, you will get the VA’s Uniform Benefit Package, which includes:
- Preventive care and services
- Adult day care
- Dental coverage
- Inpatient hospital care
- Ambulatory services
- Emergency care
- Home health care
- Prescription drug coverage
- Durable medical equipment
- Diagnostic services
- Rehabilitation care
- Mental healthcare
- Substance abuse services
- Assisted living
- Nursing home care
- Respite care
- Hospice care
If I have VA health coverage, should I also have traditional Medicare (Parts A and B)?
Generally, yes. The VA usually suggests that you take Medicare Part A
, which covers hospital care, and Part B
, which covers medical services, if you are eligible. While there is some cost associated with Part B ($99.90 a month for most people in 2012), there are definite benefits to having Medicare. These include greater flexibility in healthcare options and greater overall cost savings. This is important if your VA health coverage gets reduced or denied at any point.
Funding for VA benefits and the priority groups is set by Congress each year and can be unpredictable. So you don’t want to suddenly find yourself having to make up unexpected, increased out-of-pocket medical costs, especially if you are in one of the lower-priority veterans groups.
Can I have VA health coverage and Medicare at the same time?
Yes. If you have VA coverage, you automatically get Medicare Parts A and B when you become eligible for Medicare due to age or disability. When your date of eligibility approaches, you will receive a notice and an ID card from Social Security. You will also receive information about your Part B premiums, which is deducted from your monthly Social Security check unless you choose to pay your premiums in some other way. If you are eligible for Medicare Part B, but decided not take it, you will have to pay a penalty later if you change your mind and add it to your Medicare coverage.
The penalty can be substantial as it adds an extra 10 percent to your monthly Part B premium ($99.90 per month for most people in 2012) for the rest of your life for each full 12-month period that you could have had Part B but didn’t sign up for it. Plus, you will have to wait until the annual enrollment period that starts Oct. 15 and ends Dec. 7 each year, which can delay when your coverage will start.
There are exceptions to the Part B enrollment penalty. The most common exception is having comparable coverage through a spouse’s employer, which can allow you to delay your enrollment in Part B until after you lose that coverage.
It is important to note that being part of the VA healthcare system is considered creditable coverage as far as Medicare Part D prescription drug coverage, so you don’t have to worry about facing a late-enrollment penalty if you don’t sign up for it right away.
Can VA health coverage work with Medicare?
The two plans are separate and seldom coordinate payments to give you extra cost savings. In other words, if you get care at a non-VA facility, Medicare generally pays the bills, unless you have received prior authorization from the VA. There are exceptions, of course. For example, an emergency may require you to go to the nearest medical provider which is a non-VA facility. In this case, the VA may pick up some of the cost until you can be moved to a VA facility for further care.
However, Medicare can still provide you with more options for care than VA health benefits Also, it can provide a secondary source of coverage if VA funding or facilities get scaled back.
Can the VA charge Medicare for my medical care or prescription drugs and vice versa?
No. The VA and Medicare do not coordinate benefits. This means that if you have a Medicare-approved outpatient procedure completed at a non-VA facility, only Medicare will cover that procedure. In addition, Medicare may not cover the full cost of the procedure, so you may have out-of-pocket costs.
If I have VA health benefits, should I get Medicare Part D?
That is a personal decision depending on your needs and budget. The VA package offers prescription drug coverage, and Medicare offers the same, which is known as Part D. If you get a Medicare Part D plan
, generally, you will need to pay monthly premiums to keep it. Your costs may be less if you purchase a Medicare Advantage plan that includes prescription drug coverage.
The drug coverage you receive through the VA is considered as good as or better than that offered under a Part D plan and is premium-free, so you may not need both. However, you will be required to fill your prescriptions at a VA-approved pharmacy or by the Consolidated Mail Outpatient Pharmacy Program (CMOP). If you decide later you want a Medicare Part D plan for whatever reason, you are allowed to enroll in one without penalty.
If I have VA health benefits, do I need Medicare Advantage?
Not necessarily. If you have VA benefits, but need medical services that the VA does not cover, you can simply use your traditional Medicare benefits at the time of service. However, if you would like to have a Medicare Advantage plan
, you can enroll in one. Medicare Advantage plans typically combine coverage provided by Medicare Parts A and B, and may include additional benefits and services. Some people find that having Medicare Advantage works best for them, even if they already have VA benefits.
What are the pros and cons of VA health coverage?
- It’s free or low cost
- You can receive care at any VA facility
- If you are very sick and/or have extremely low income, you receive first priority
- It offers creditable prescription drug coverage, so you don’t have to purchase a Medicare Part D plan or Medicare Advantage plan with Part D
- Care is prioritized based on who is most sick and/or has the lowest income
- Some VA facilities have very long wait times for necessary procedures
- You can only see VA doctors/go to VA facilities or approved non-VA facilities
- Any prescriptions you fill must be filled at a VA pharmacy
What are the pros and cons about having Medicare and VA coverage at the same time?
- You can get care from both VA and non-VA-approved healthcare providers
- You can have traditional Medicare and coverage as good as Medicare Part D without having to pay for a stand-alone Part D plan
- If you want medical care now, but there’s a waiting period at the VA, you can find a Medicare provider to see you sooner
- You have to pay your Medicare Part B premium every month
- Some people may be confused about when to use a VA facility versus a non-VA provider that accepts Medicare
- You may have an extra Part D premium, if you choose added coverage
- You may face Medicare Part B late enrollment penalties if you improperly handle your Medicare enrollment and deferral choices
If I have VA health coverage and Medicare, when should I use VA benefits vs. my Medicare benefits?
It depends. Every VA office operates differently, and one facility may provide a different quality of care than another. Also, some facilities may have shorter wait times than others for access to specialists, certain medical procedures and more.
Since your VA coverage is free, if you are high on the priority list and there isn’t a long wait to get care, it may be wise to use your VA coverage instead of Medicare. VA coverage may be preferred, especially if you need inpatient hospital care or prescription drugs, because you are getting low- or no-cost health benefits in a timely manner.
However, if you face a long wait time for medical care (for example, you need to see a physical therapist or have an operation, but the VA waiting list is several months long), you might want to consider using your Medicare coverage outside the VA healthcare system. The same applies if you want to undergo a medical procedure or take a prescription drug that is not approved by the VA.
Because your healthcare situation is unique, you should carefully consider both your financial and healthcare needs when choosing what healthcare coverage will work best for you.