A few weeks ago a client called asking about a postcard he had received from DMDC about upcoming changes to TRICARE for his wife. She was a few months from turning 65. He wasn’t tracking any kind of transition and just assumed TRICARE continued as-is after the initial military retirement transition.
Truth is, the TRICARE transition at retirement is just the first of the changes to your post-military TRICARE coverage. The second is the transition to TRICARE For Life (TFL) and Medicare at age 65. If you’re not careful, you might miss it. Here’s what you need to understand.
The Framework
Medicare will be your primary medical insurance at age 65, with TFL as wraparound coverage. You lose the ability to enroll in TRICARE Prime or Select. Medicare will be the primary payer, with TRICARE covering the costs that Medicare doesn’t. For services covered by Medicare and TRICARE, you’ll typically have no out-of-pocket costs.
There is no enrollment fee or paperwork. As soon as you sign up for Medicare Parts A and B, you are covered.
The Cost
You will no longer pay the annual enrollment fees for Prime or Select once you are covered by TFL. That’s the good news. BUT, you will pay Medicare Part B premiums. Medicare premiums are based on your income, and the minimum monthly charge in 2026 is $202.90 per person. For 2026, the minimum a couple will pay for the year is almost $5,000. Premiums can go significantly higher depending on how much you earn, which is called the Income-Related Monthly Adjustment Amount (IRMAA). I wrote about IRMAA in this article.
Timing Trap
Medicare has a 7-month window for initial enrollment around your 65th birthday…3 months before, your birthday month, and 3 months after. You will want to make sure you sign up 2 months prior to your birthday so coverage will begin when you turn 65. If you don’t, you’ll be without any coverage until you enroll in Medicare Parts A and B, since TRICARE Prime and Select both end automatically at 65.
If you fail to sign up during the initial enrollment period, you’ll need to wait until the next General Enrollment Period (Jan 1 – Mar 31 each year). In addition to not having coverage, your premium will go up 10% for every 12-month period you should have had Medicare Part B and weren’t enrolled.
Common Questions
A few questions people routinely ask:
What if I’m still working at 65 and have employer healthcare coverage? You can delay signing up for Part B until you stop working or no longer qualify for employer coverage. You won’t have TFL as secondary coverage during this time because you must have Part B to get TFL coverage.
What happens with TRICARE if there is an age difference between spouses? Qualifying for Medicare is an individual activity. The first spouse to reach age 65 will transition to Medicare. The younger spouse can continue on TRICARE Prime or Select with no change.
Do military retirees need to buy Part D (drug coverage) or a Medigap plan? In general, no. TRICARE provides a pharmacy benefit, and TFL acts similarly to a Medigap plan.
What if I’m a military retiree and live overseas? You still need Part B, but TRICARE will be the primary payer.
Do I need Part B and TFL if I primarily use VA healthcare? It is recommended you still get Part B (and therefore TFL) even if you use the VA for most of your healthcare. Medicare and VA are two separate systems. If you don’t sign up for Part B, you will only have VA coverage, so any care you need on the outside could result in very high costs that you will have to pay. Additionally, having VA coverage does not count as employer coverage to delay Part B. If you wait to sign up for Part B beyond 65, you’ll pay the premium penalties for the rest of your time on Part B.
Awareness and Planning
This information is primarily for the changes you’ll want to be aware of as you approach age 65. There are planning opportunities, generally around IRMAA and income structure, starting in the year you turn 63. This is one of those dates that sneaks up on people, especially retirees doing Roth conversions, until they get the Medicare bill at 65.
One of the excellent benefits you earned with military retirement is lifetime healthcare. You’re not losing that; it just changes when you become Medicare eligible. You just want to make sure you’re tracking the shift as you approach 65 so you don’t miss it.
