Health Insurance Options for Veterans

America’s approximately 19.1 million veterans may have access to more health insurance options than the general public, but these options are often complicated to navigate. Choosing the right health insurance plan can be difficult for anyone. However, the process can be especiallydaunting for military veterans weighing complex healthcare benefits and eligibility for veteran-specific benefits.

Health insurance help veterans and their families pay for routine healthcare and budget for unpredictable medical costs. Veterans could enroll in a private plan, such as a Marketplace plan or their employer’s group health plan. Others may choose a public health insurance option, such as Medicare or Medicaid. Veteran-specific health insurance options are also available, such as a TRICARE plan or VA healthcare. 

Do Veterans Need to Have Health Insurance?

No, health insurance for veterans generally is not mandatory. The federal mandate to buy health insurance is no longer in effect, and most states do not require residents to get coverage.

The Affordable Care Act’s individual coverage mandate, which imposed a tax penalty on uninsured Americans, was repealed in 2019. However, a few states have passed their own mandates, including California, New Jersey, Massachusetts, Rhode Island, and the District of Columbia.

Even though health insurance may not be mandatory in most cases, veterans may decide they need coverage. Health insurance can help veterans pay for routine and unexpected medical bills and help make healthcare expenses more predictable.

Health Care Options for Veterans and Military Service Members

Veterans may have access to two healthcare options that are not available to the general public: TRICARE and VA healthcare. 

Tricare Benefits

TRICARE is a health insurance program for members of the U.S. military, providing health insurance for approximately 9.6 million veterans and their family members. Unlike traditional health insurance plans, TRICARE enrollees receive health care in military hospitals and clinics or from participating civilian providers.

Eligibility

Two groups of people are eligible for TRICARE: sponsors and family members. Sponsors are eligible for TRICARE based on their military service, including:

• Active duty service members
• Active duty National Guard or Reserve members
• Retired service members or Reserve members

Some veterans may not be eligible for TRICARE as sponsors. Unlike the VA healthcare system, TRICARE does not generally cover veterans who separated from active duty before retirement.

Family members may be eligible for a TRICARE plan based on their sponsors’ military status. Eligible family members may include children, spouses, and unmarried former spouses. 

Covered Benefits

There are several TRICARE plans, including TRICARE Prime, TRICARE Select, and TRICARE For Life. In general, TRICARE plans offer coverage for medically necessary services, such as:

• Primary care
• Preventive care
• Hospital care
• Tests and X-rays
• Pregnancy-related care
• Eligible prescription drugs

Covered benefits may vary between plans depending on your current military status. For example, TRICARE Prime covers glasses or contacts for active duty service members, but this benefit is not offered to family members or retired service members. 

How to Enroll

Enrolling in TRICARE is mandatory for active duty service members and optional for other eligible people. Veterans who want to enroll in TRICARE can submit an application by mail, fax, phone, or online.

VA Health Care

The VA Health Care System is a Department of Veterans Affairs program that administers medical benefits packages to approximately 9.6 million veterans. Unlike traditional health insurance plans, VA benefits are only available in VA hospitals or clinics.

Eligibility Criteria

Veterans may be eligible for VA healthcare benefits if they were called to active duty and received an honorable discharge. For veterans who enlisted after September 7, 1980, a minimum duty requirement of 24 continuous months generally applies.

The VA sorts applicants into 8 priority groups based on various factors, including income level, military service history, and disability rating. Lower-priority veterans could be removed from the program.

The VA healthcare system does not generally cover veterans’ families. However, family members of veterans who received a 100% disability rating or died in the line of duty may be eligible to receive care in VA facilities.

Covered Benefits

The VA does not provide the same set of services for all members. Each veteran receives an individualized medical benefits package based on their priority group and the services their VA primary care provider recommends. 

The VA’s basic health benefits include preventive care, inpatient hospital stays, and urgent or emergency care. Other services that veterans could have coverage for include:

• Diagnostic tests
• Rehabilitation therapies
• Vision care
• Dental care
• Prosthetics
• Medical transportation

VA healthcare does not cover services that are not medically necessary, like cosmetic surgeries. It also does not cover drugs that are not FDA-approved unless you are in a clinical trial.

How to Enroll

Since there are no set enrollment periods, veterans who are interested in VA healthcare can apply at any time of year. To apply for VA healthcare, you can complete an application online, by mail, over the phone, or in person at a VA hospital or clinic. The VA generally makes enrollment decisions in less than a week.

Other Types of Health Insurance Options for Veterans

It is important to note that veterans are not limited to TRICARE or VA coverage for health insurance. You can also consider the wide range of civilian health insurance options, including an Affordable Care Act (ACA) plan, employer-sponsored plan, Medicaid, or Medicare. You may also enroll in a standard health insurance plan to supplement your TRICARE or VA plan for more coverage. 

Health Maintenance Organization (HMO)

A Health Maintenance Organization (HMO) plan generally requires members to get care from providers in the plan’s network. Veterans may find HMOs through the Health Insurance Marketplace or an employer-sponsored policy.

There are several important distinctions between HMOs and other popular health insurance plan types. When veterans join an HMO, they generally need to choose a primary care physician (PCP) who participates in the plan. PCPs are responsible for managing members’ treatment and care, including providing referrals to in-network specialists.

In an HMO, veterans are generally limited to healthcare providers and facilities within the plan’s network. Those who decide to seek out-of-network care may be responsible for the entire cost of that care. However, there are some exceptions: HMOs may cover out-of-network emergency care or urgent care visits outside the plan’s service area.

It is possible to use HMO coverage alongside TRICARE or VA health benefits. For veterans who have both TRICARE and an HMO plan, the HMO is the primary payer, meaning it pays for covered services first. Remaining costs may be submitted to TRICARE for coverage. For veterans with both VA healthcare and an HMO plan, VA healthcare facilities may bill the HMO for care that is not related to their military service.

Preferred Provider Organization (PPO)

A Preferred Provider Organization (PPO) is a type of health insurance plan that gives members the flexibility to see both in-network and out-of-network providers. Like HMOs, PPOs may be offered by employers or sold through the Marketplace.

There are some key differences between PPOs and other types of health plans, such as HMOs. Veterans who join a PPO plan generally do not need to select a designated primary care physician and may not need to get a referral to see a specialist. 

In a PPO, in-network providers are preferred. When veterans choose to get care from a doctor, hospital, or another provider in the plan’s network, their costs for covered services may be lower. For instance, a PPO plan may set a 30% coinsurance for an in-network specialist visit but 50% for out-of-network specialists.

Like HMOs, PPOs can work alongside veterans health insurance. If you have a PPO and TRICARE, the PPO pays first. If you have VA coverage, the PPO may pay for non-service-connected care in VA facilities.

Point of Service (POS)

A Point of Service (POS) plan is a type of health insurance plan that borrows features from both HMOs and PPOs. Like an HMO, POS plans require members to get referrals from a designated primary care doctor to seek specialist care. And like a PPO, POS plans offer a higher level of coverage for in-network services.

Whether a POS plan is purchased through the Marketplace or provided by an employer, it can work alongside TRICARE or VA healthcare. POS plans pay for covered services before TRICARE and may cover non-service care at the VA.

High Deductible Health Plans (HDHP)

As the name suggests, high-deductible health plans (HDHPs) have a higher deductible than other options. These plans may be structured as HMOs, PPOs, or POS plans and could be sold in the Marketplace or offered by employers.

The deductible is the amount plan members must pay on covered services before the insurer begins to share the cost. For 2022, individual plans with an annual deductible of $1,400 or more are considered HDHPs. Family plans are HDHPs when the deductibles are $2,800 or higher.

HDHPs tend to have lower monthly premiums than other plan types to offset the higher healthcare costs. These plans might be a good option for healthy veterans who rarely need medical care. They can take advantage of the lower monthly costs for health coverage and are unlikely to need to meet the high deductible. Conversely, HDHPs may not be ideal health insurance for disabled veterans or others with chronic health concerns.

Medicare

Medicare is a federal health insurance program for people 65 and older, as well as those under 65 with eligible disabilities or End-Stage Renal Disease. Veterans may opt to enroll in either Original Medicare or Medicare Advantage.

Original Medicare consists of Part A (hospital insurance) and Part B (medical insurance). Part A offers coverage for inpatient hospital stays, short-term nursing home care, hospice care, and home health care. Part B covers medically necessary or preventive services, such as doctor visits and lab tests. There are also optional supplement plans to Original Medicare:

• Part D: These plans offer coverage for prescription drugs. The specific drugs covered vary by insurer and plan.
• Medicare Supplement Insurance, or Medigap: These plans help cover out-of-pocket costs associated with Original Medicare, such as coinsurance and monthly premiums.

Medicare Advantage is an alternative to Original Medicare offered by private insurance companies. These plans cover Part A and Part B services and generally include Part D drug coverage as well. Some plans may also cover benefits that Original Medicare does not, such as dental or vision care.

Some veterans may be automatically enrolled in Medicare when they turn 65 or when they have received Social Security Disability Insurance for 24 months. For those who are not automatically enrolled, Medicare’s relatively low premiums compared to Marketplace plans may make it a good option.

When veterans with TRICARE join Medicare, Medicare pays first, and TRICARE may cover the remaining costs. For veterans with VA health benefits, joining Medicare provides beneficiaries flexibility to get care in non-VA facilities. 

Medicaid

Medicaid is a public health insurance program for low-income individuals and families. As of May 2022, it covers 81.9 million people nationwide. States run their own Medicaid programs, so costs and covered benefits can vary. 

In all states, Medicaid covers a set of federally mandated benefits, such as hospital services, physician services, and laboratory services. States may choose to offer certain optional benefits, such as prescription drug coverage. Generally, Medicaid members are required to get care in their own state to receive coverage.

Medicaid can be used alongside TRICARE or VA health benefits. When veterans have both Medicaid and TRICARE, TRICARE pays for claims first. VA healthcare facilities do not bill Medicaid, but veterans could use their Medicaid coverage at non-VA hospitals.

How to Enroll in Marketplace Plans

The Affordable Care Act established the Health Insurance Marketplace, a resource where Americans can shop for health insurance plans.

Choose a Coverage Tier

Marketplace plans are grouped into 4 coverage tiers to help shoppers understand their potential out-of-pocket costs. Consider your budget and health needs when choosing a tie, keeping in mind that the tiers only reflect pricing, not quality of care.

• Bronze: Lower premiums, but higher costs if you need care.
• Silver: Moderate premiums and moderate care costs.
• Gold: Higher premiums, but lower out-of-pocket care costs.
• Platinum: High premiums paired with low costs when you get care.

Outside of the tiers, there are also catastrophic plans. These plans have the highest cost sharing amounts allowed, and generally high deductibles before insurance benefits kick in. The deductible for 2022 is $8,700 for individuals.

Evaluate Covered Benefits

Covered health benefits may vary between plans, so compare each plan to find an option that meets your needs. Each plan is required to offer coverage for services in the following 10 categories:

1. Outpatient care
2. Emergency care
3. Hospitalizations
4. Pregnancy and childbirth, including breastfeeding services
5. Mental and behavioral health services
6. Prescription drugs, including birth control
7. Rehabilitation therapies and devices
8. Laboratory services
9. Preventive health services
10. Services for children

Confirm Eligibility

The Marketplace was created to help uninsured people get health insurance, including those who do not have coverage through their employer or through a spouse or parent’s plan. However, being uninsured is not a requirement to use the Marketplace. Veterans can enroll in Marketplace coverage if they meet the following criteria:

• You must reside in the United States.
• You must be a U.S. citizen, U.S. national, or lawfully present immigrant.
• You cannot be incarcerated.
• You cannot be enrolled in Medicare.

Wait for an Enrollment Period

Veterans can buy a Marketplace plan during the annual Open Enrollment Period, which runs from November 1 to January 15 each year in most states. However, you may be able to enroll at other times if you are eligible for a Special Enrollment Period.

To enroll in a Marketplace plan, visit the federal or state Health Insurance Marketplace during the Open Enrollment Period, or contact a trusted insurance agent to help you shop for plans. Other options include completing a paper application or enrolling by phone.