What happens if I have retiree health coverage, Tricare and Medicare?

AARP

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En español

Published March 13, 2023

If you’re enrolled in Medicare and have coverage from Tricare for Life and retiree health insurance from a civilian job, Medicare pays first, the retiree health insurance pays second, and Tricare for Life pays third.

Having all three types of coverage is typical for retired military who take a civilian job after they leave the service.

Think of it like this: Medicare almost always pays first when people are retired, enrolled in Medicare and entitled to one or more other types of health benefits. Usually, retiree benefits from a former employer or union or other forms of supplemental coverage such as Medigap insurance pay second. Other government programs, such as Medicaid or Tricare for Life, pay last.

The rules are different if you or your spouse is still working and you have coverage from an active employer. If the employer has 20 or more employees, the group health insurance pays first and Medicare pays second. For smaller employers, Medicare generally provides primary coverage at 65 and the employer’s coverage is secondary.

How do all three work together?

Using all three coverages for one claim is not unusual. Each type of insurance you have, including Medicare, is considered a payer. If you have more than one payer, Medicare’s coordination of benefits rules determine which policy pays first, second and third.

When you go to a doctor or other provider, the bill is sent to the first payer, Medicare in this case, which pays only what it covers. What’s left then goes to the secondary payer, which may cover some deductibles, copayments and expenses that Medicare doesn’t cover. Finally, the third payer may or may not cover the remaining costs.

Your retiree coverage could pay some of Medicare’s deductibles and copayments, and Tricare for Life may cover the remaining expenses.

But if you don’t sign up for Medicare at 65, the scenario changes. Your retiree coverage may not pay your claims. The rules are different for retired federal employees covered through the Federal Employees Health Benefits program.

And to have Tricare for Life coverage, you must enroll in Medicare Part A and Part B after you turn 65. Traditional Tricare coverage generally ends at 65 unless you’re still on active duty at that age or you’re an eligible family member of someone on active duty.

The coordination of benefits rules are different if you qualify for Medicare before age 65 because of a disability. See Medicare & Other Health Benefits: Your Guide to Who Pays First for details.

Should I notify my doctors about other insurance?

Yes. Inform your doctor, hospital and other health care providers as soon as you learn of a procedure or stay, so they can ensure that your bills are sent to the correct payers and in the right order. Let your providers know if any of your coverage changes.

You can track your claims with the Medicare Summary Notice, a quarterly statement that lists amounts providers charge, how much Medicare paid and whether Medicare sent a claim for the remaining expenses to your other insurers. You can always access claims information through your online Medicare account.

Keep in mind

The rules differ if you have U.S. Department of Veterans Affairs (VA) and Medicare coverage. The two entities don’t coordinate benefits.

Instead, the VA health system covers only VA doctors and providers. Medicare may cover your other care.

Under some circumstances, the VA may authorize services to a hospital not in its system. In that case, if the VA doesn’t authorize all the services you receive during your hospital stay, Medicare may pay for remaining Medicare-covered services.

For more information about health benefits for veterans, see AARP’s Veterans Health Benefits Navigator.

Updated March 13, 2023

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