VA vs Medicare Question

[joesxm3]

I know nothing about VA benefits.

My stepbrother who has been living off of VA benefits, disability and other such programs for years is now turning 65.

I was just talking to him and he said that he is not going to sign up for Medicare because he does not want to pay twice for health care since he has been taken care of by the VA.

That does not sound right to me, but I have never been involved in these sorts of programs.

He also just bought a house for $250,000 with a VA mortgage apparently no down payment.

I am worried that he is setting himself up for some major problems.

Do any of you know about this stuff?

Thanks.

 

[grayv]

He could use only the VA, but having medicare will give him a lot of private sector medical choices.


Basic medicare Part B will cost $2100 per year. For that price, he can get a zero-premium advantage plan. he might even find one in his area that rebates part the cost of Part B.

 

[Dash man]

I know nothing about VA benefits.

My stepbrother who has been living off of VA benefits, disability and other such programs for years is now turning 65.

I was just talking to him and he said that he is not going to sign up for Medicare because he does not want to pay twice for health care since he has been taken care of by the VA.

That does not sound right to me, but I have never been involved in these sorts of programs.

He also just bought a house for $250,000 with a VA mortgage apparently no down payment.

I am worried that he is setting himself up for some major problems.

Do any of you know about this stuff?

Thanks.

No down payment VA loans have been around a long time. I bought my first home in 1987 using VA with a 10.5% mortgage. My nephew is looking to use his soon. The loan is guaranteed by the VA, but you still have to qualify for the mortgage.

 

[ivinsfan]

You don't know enough details at this point. If he is very low income or disabled through military service he will pay very little if anything for VA services.


The VA will encourage, but not require you to signup for Part B. If he elects to go only VA he should be proactive about staying "active" in the system. In this day and age I kind of think that any veteran that is "active" in the VA system has little change of being dropped from coverage.

 

[5Miler]

The chances of being dropped from VA coverage depend largely upon the Priority Group assigned with the understanding coverage can be eliminated for lower priority groups ( Think groups 7 and 8) at the discretion of our government. In 2003, coverage for Priority Group 8 was discontinued due to budgetary constraints but coverage has been added back since that time.

The VA continues to publish studies on discontinuing coverage for Priorty Groups 7 & 8 with the latest study showing the effects of discontinuing coverage in 2023 and dropping existing Priority group 7 & 8 members as of Oct 2023 all due to budget constraints. Fortunately this did not come to pass - this time.

I have been under VA medical coverage for 10 years now but make it a point to keep current with Medicare and a supplemental plan. VA medical coverage does not count as creditable medical coverage for Medicare so lifetime penalties would be incurred if VA coverage was lost and a late signup for Medicare was needed. VA medical coverage is creditable coverage for Medicare part D though.

https://www.cbo.gov/budget-options/58671

 

[5Miler]

If your step brother has a VA disability income he is probably in a higher priority group than the perilous Priority Groups 7 and 8. In that case, with a service connected disability his chances of losing VA medical coverage is probably miniscule as nobody wants to be accused of cutting benefits for disabled vets these days. In those shoes, I would take that chance providing I didn't mind giving up expanded health care options under Medicare.

 

[braumeister]

VA medical coverage does not count as creditable medical coverage for Medicare so lifetime penalties would be incurred if VA coverage was lost and a late signup for Medicare was needed.

It does for me. I get a 1095-B from them every year.
I'm group 3, so maybe that makes a difference.

 

[DuluthGA]

Does he also qualify for Medicaid?

 

[joesxm3]

No. I think he had been before but not now.

Thanks for all the answers.

 

[schenbew]

Here's a link from the VA itself on the issue - https://www.va.gov/health-care/about-va-health-benefits/va-health-care-and-other-insurance/

Regarding Medicare specifically, it says:

"If I already have VA health care benefits, should I still sign up for Medicare when I turn 65?"

Yes. We encourage you to sign up for Medicare as soon as you can. This is because:

• Having Medicare means you’re covered if you need to go to a non-VA hospital or doctor—so you have more options to choose from.
• Funding for VA health care could change in the future. We encourage you to sign up for every health care benefit that you’re eligible for so you have options if you need them.
• If you delay signing up for Medicare Part B (coverage for doctors and outpatient services) and then need to sign up later because you lose your VA health care benefits or need more choice in care options, you’ll pay a penalty. This penalty gets bigger each year you delay signing up—and you’ll pay it every year for the rest of your life.
• If you sign up for Medicare Part D (coverage for prescription drugs), you’ll be able to use it to get medicine from non-VA doctors and fill your prescriptions at your local pharmacy instead of through the VA mail-order service. There’s no penalty for delaying Medicare Part D as long as you enroll when you’re first eligible or within 63 days of when you no longer have VA health care or other creditable prescription drug coverage. Learn more about how to avoid the Part D penalty on the Medicare website

 

[ivinsfan]

It does for me. I get a 1095-B from them every year.
I'm group 3, so maybe that makes a difference.

It does qualify, the issue is getting Medicare coverage in addition to VA coverage.. you will get a delayed sign up penalty after 65. I had to look it up myself but yes that's the way it works.

 

[braumeister]

I guess it all seems obvious to the bureaucrats.

Of course, there was never a question about me signing up for Medicare, but I like having access to the VA facilities in my back pocket as it were. I make sure to visit them every year to stay active (and help justify their budget).

 

[ivinsfan]

A friend of ours had only VA coverage and regular part B Medicare. I believe the 1095B allows you to sign up for a Medicare supplement without penalty outside of the normal original sign-up period. Don't quote me thou!

 

[Bflotomny]

*Having Medicare means you’re covered if you need to go to a non-VA hospital or doctor—so you have more options to choose from.
*Funding for VA health care could change in the future. We encourage you to sign up for every health care benefit that you’re eligible for so you have options if you need them.
Ten years ago this was given to me as the reason to sign up for both. Nothing in ten years has changed my mind.

These are the two most important reasons for signing for Medicare. I'll add one more-Prescriptions at the VA cost $8.00 per script per 30days. I know many vets who fill their scripts via Medicare because its less expensive. I get my script for $4.00 for 90days vs. $24 for 90 dyas at the VA

 

[goingtotravel]

DH has VA coverage and is in Priority group 1. Priority group 1 pays nothing for prescriptions. Just wanted to clarify that not all priority groups are charged for medication.

 

[5Miler]

DH has VA coverage and is in Priority group 1. Priority group 1 pays nothing for prescriptions. Just wanted to clarify that not all priority groups are charged for medication.

I am priority group 7 and do not get charged for my 3 monthly prescriptions via the VA. I always thought I would be charged but after 10 years, I quit asking questions. I think I read something recently that led me to believe I wasn't being charged due to the low tier of my drugs as they are all generics that are also free if I got them through my new Wellcare Part D plan.

So much of the billing at the VA is a mystery to me. I go to my PCP once or twice a year at $15 a visit and to the Ophthalmologist and Dermatologist once a year at $50 a visit but haven't received a bill in over two years now. The last bill I got was for $8 or so but after I paid it, I got a refund of the entire amount 6 months later. I know they bill my UHC supplemental policy as I see those statements but the VA never seems to get around to billing me for the balance, small as it may be.

 

[grayv]

believe I wasn't being charged due to the low tier of my drugs as they are all generics that are also free if I got them through my new Wellcare Part D plan.

I think the general idea is that VA does not charge the vet copays if they have other insurance that the VA can bill.


in this case, perhaps having a part D plan is considered that other insurance.




or the drugs are so cheap that the VA and Wellcare just work it out.

 

[5Miler]

I think the general idea is that VA does not charge the vet copays if they have other insurance that the VA can bill.


in this case, perhaps having a part D plan is considered that other insurance.




or the drugs are so cheap that the VA and Wellcare just work it out.

I just got my first Part D plan under Wellcare effective the first of this month so that definitely wasn't a factor. Never had a Medicare Part D plan prior to that. Makes me wonder sometimes.

 

[Nords]

I know nothing about VA benefits.
I was just talking to him and he said that he is not going to sign up for Medicare because he does not want to pay twice for health care since he has been taken care of by the VA.
That does not sound right to me, but I have never been involved in these sorts of programs.

Your instincts are correct, @Joesxm3. I'm writing as a 63-year-old military retiree with VA disability care, and your stepbrother should sign up for at least Medicare parts A&B. He doesn't need to sign up for Part D (prescription coverage) if he's happy with the VA pharmacy.

If he wants to [-]debate[/-] discuss his Medicare options then he should contact his local VA clinic or a Veteran Service Officer through his local chapter of the DAV, American Legion, VFW, or even MOAA. VSOs provide their services to the vet for free, and he doesn't have to be a member of those vet's organizations.

He also just bought a house for $250,000 with a VA mortgage apparently no down payment.

That's perfectly fine. A VA mortgage is a loan that comes from any mortgage lender who offers VA loans, not actually from the VA.

The VA insures the mortgage lender for roughly a quarter of the mortgage balance (up to a certain amount), which makes it easier for the vet to meet the lender's underwriting requirements.
https://benefits.va.gov/homeloans/documents/docs/vap_26-4_online_version.pdf

The VA buys their mortgage insurance by charging a funding fee, but the fee is waived for any vets with a disability rating of at least 10%.

With the VA's loan guaranty, lenders will offer lower interest rates, zero-down loans (even with the closing costs rolled into the loan), and much more generous ratios for total debt to income. Most lenders still follow the mortgage financing guidelines that let them package & sell loans to Fannie Mae or Freddie Mac.

Your stepbrother still had to pass the lender's underwriting requirements, and presumably his financial situation looks fine to them. His tax-free VA disability compensation might be the money that helps him make the mortgage payments.

 

[joesxm3]

I have had almost nothing to do with my stepbrother over the years but had a talk with him this morning and found out a little of his financial condition.

He said that he gets something like $3400/month VA disability and that his mortgage, insurance and tax will be paid automatically out of that. I don't remember the exact number but it was on the low end of the $2000's.

He signed up for SS and says he will get about $700/month.

He had been saying that he has been saving extra, but this is only $13,000.

He had been paying something like $900/month plus electric heat for his apartment.

So it seems to me that he is really tight on taking on this new house. Rough guess it seems that after paying for the house payments he will have at most $2000/month for expenses. That will include oil heat, electricity, cell phone, food, booze etc.

Against my better judgement, I think I may try to talk him into writing down a budget and coming to grips with his cash flow situation.

What I am wondering now is given his tight situation should he still sign up for Medicare B? If he gets religion on his budget maybe, but if not it will just push him $200/month closer to negative cash flow.

I suppose at this point, without the written budget, I am just guessing. At this point in my life I find it hard to relate to living on such a small amount although I probably lived on less in my early 20's.