Tricare For Life & Medicare Penalty

Hi Stephanie,

I’m a veteran on TriCare and I’m not sure I want to continue to go to the VA hospital for medical coverage. I’m currently 72 years old and I recently went to the Social Security office to apply for Medicare. To my surprise, Social Security told me that I could get Medicare, but I would be penalized a fee. I’m confused? I thought that being a veteran would eliminate any type of penalty fee. Social Security is wanting to charge me 10% for each year I didn’t have Medicare Part B; which would be a 70% penalty fee. Plus the premium fee that’s required for Medicare Part B.  Is this true? I’m very confused; please explain.   Thanks, Robert M from League City

Hello Robert,

Many veterans do not realize that when they first turn 65, it’s beneficial to enroll into Part B of Medicare. If you do not enroll once you turn 65, you could be subject to a penalty fee. Unfortunately, Medicare does NOT see the VA Tri-Care medical plan as “True Creditable Coverage”. For this reason, because you did not enroll into Medicare at age 65, you will be charged a penalty fee of 10% for every year that you should have been on Medicare, but chose not to enroll. 

For example, let’s say that your current Medicare premium is $135.50. As a result of the late penalty fee, you would be subject to a 70% penalty charge (10% for each of the 7 years you were not enrolled in Medicare). This adds up to an additional fee of $94.85 per month, as $94.85 is 70% of your supposed premium of $135.50. This penalty fee in addition to the premium of $135.50; then results in a grand total of $230.35. 

Sadly, I regret to inform you that this penalty fee remains in place for the rest of your life. For this reason, it’s extremely important to know the Medicare rules before enrolling into either Tri-Care or Medicare.  Hope this answers your question.  

Best Regards, 

Stephanie Salcedo

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