TRICARE for Life and Medicare Part B: The Premium Your Pension Pays

At age 65, what does the TRICARE rule actually require?

TRICARE For Life generally requires you to hold both Medicare Part A and Medicare Part B once you become eligible for Medicare, except while the military sponsor stays on active duty. Part B is the medical-insurance half of Medicare. TRICARE For Life pays after Medicare does, so without Part B the coverage generally does not work as intended.

People often paraphrase this as 'TRICARE covers me for life.' That's true only with Part B in place. Part A usually costs nothing for people with enough work history, but Part B carries a monthly premium that Social Security (or a bill from Medicare) collects, and for many retirees it comes out of the same pension deposit that used to arrive whole.

So the premium is not optional, and for you the only open question is how big it gets. That depends on income, which is where tax moves come in.

Six beliefs that change the monthly Part B bill

Most retirees assume everyone pays the same Part B premium. The table below sets six common beliefs against what the rule says. Look hardest at the second row: one dollar above $109,000 of MAGI and the monthly premium jumps from $202.90 to $284.10.

The table uses single-filer tiers because Omar, the hypothetical retiree used later in this guide, is divorced. The amounts are the total 2026 Part B premiums, not the surcharge alone. Medicare reads your income from two years earlier, so the 2026 premium follows your 2024 tax return.

One more point that trips people up: the Part B annual deductible of $283 is separate from the monthly premium. Paying one doesn't cover the other. You pay the premium every month, and you also pay the first $283 of Part B-covered costs yourself before Medicare starts sharing them (TRICARE For Life usually picks up that cost-share for covered care).

Which income from 2 years earlier reaches IRMAA?

Medicare uses modified adjusted gross income, generally your adjusted gross income plus tax-exempt interest, from the tax return filed 2 years earlier. For a 2026 premium that means the 2024 return. The Social Security Administration applies the tiers using figures the IRS shares with it.

Several items in your life can raise MAGI: military retired pay, your civilian salary, income draws from a traditional TSP balance, and any Roth conversion you choose to make. Tax-free VA disability compensation generally does not enter federal adjusted gross income, so it usually doesn't push you up a tier.

Here is the tax distinction worth holding onto. A Roth conversion moves taxable income into an earlier year so later income draws can come out tax-free. It doesn't erase the tax. It can also create an IRMAA charge two years later, which is a cost the conversion itself never shows on Form 8606 or the 1099-R. Edgepoint Wealth Management looks at that second cost before a conversion is sized, not after.

Omar's $20,000 conversion test before Medicare begins

Omar (hypothetical) is 57, a retired Army colonel with 28 years of service. He is divorced and now a consulting director earning $180,000. His pension is about $8,000 a month, and he has $900,000 in mostly traditional TSP money. He's thinking about a $20,000 Roth conversion and wants to know whether it could raise a Medicare premium years from now.

Start with the income. Say his MAGI in the conversion year is $108,000, made up of pension, consulting pay and other taxable income. Add the conversion: $108,000 + $20,000 = $128,000. That lands between $109,000 and $137,000, the second single-filer tier in the 2026 table. Part B in that tier is $284.10 a month instead of $202.90. At 57, Omar's conversion this year would not be reviewed by Medicare; the same math applies only if he converts at 63 or later, inside a lookback year.

The gap is $284.10 minus $202.90, which is $81.20 a month. Multiply by 12 and you get $974.40 for one year. That's before any effect on Part D or on his income-tax bill. You can run similar numbers in the calculator on this site.

The comparison below puts the two paths side by side, using the 2026 amounts only to show the mechanism.

Omar isn't 65 yet, so these 2026 premiums illustrate how the rule works. They don't forecast his future Medicare cost. The thresholds and premiums have to be checked in the year he actually enrolls.

The conversion may still be worth it. Roth money has no required minimum distributions for him to manage later, and he may expect higher brackets once the pension and TSP draws stack up. What the arithmetic shows is that the conversion has a price tag beyond the income tax.

The income-first order for Omar is this. Estimate the pension, the consulting income and the income draws he will need first. Then choose a conversion amount. Edgepoint Wealth Management doesn't suggest a fund change until the tax and IRMAA timing are on paper.

One caution about the money itself. Investments aren't guaranteed, and a portfolio can fall for years at a stretch, so a conversion shouldn't be funded by selling a holding only because the market has risen.

The math, line by line

What the numbers do not tell you

Put these enrollment dates on one calendar

The Initial Enrollment Period lasts 7 months. It opens 3 months before the month of your 65th birthday, includes the birthday month, and runs 3 months after it. Signing up early inside that window can avoid a coverage gap. Don't assume your effective date, though. Verify it with Medicare and TRICARE before you change anything else.

Now set the tax calendar beside it. A return from 2 years before the Medicare year supplies the IRMAA income figure. So a large Roth conversion close to age 63 can matter at age 65, and income at age 64 can matter at age 66.

For a retiree like Omar, the years just before enrollment deserve a second look. Big one-time income, such as a contract bonus or a large TSP draw, should sit on the calendar right next to the 65th birthday. The related pieces on military retirement planning and tax planning for veterans cover the bigger picture.

What timing errors can leave a permanent Part B cost?

Going 1 full 12-month period without qualifying Part B coverage creates a 10 percent late penalty, and it generally lasts as long as you hold Part B. With the 2026 standard premium, $202.90 times 10 percent is $20.29 a month, or $243.48 a year.

The careful-person version goes like this. A retiree keeps a retiree health benefit from a former employer and assumes it counts as current-employment coverage. It usually doesn't. Two years later he enrolls, and the penalty is added to every bill.

Wrong-order errors cost money too. Don't cancel coverage, and don't make a big conversion, before you've confirmed the Part B effective date and what the extra income does to MAGI. Check the order on paper first.

There is an exception. People covered through their own or a spouse's current employment may have different enrollment timing rules. Even so, while Part B is delayed, TRICARE For Life does not pay. This page doesn't settle those cases. Confirm with Medicare, the employer's benefit office and TRICARE before changing coverage.

The kitchen-table conversation usually starts with the person who handles care

In most homes, the spouse, adult child or whoever books the appointments raises Part B first, while the retiree is thinking about the pension deduction. Let that person ask. Then write down who will track enrollment notices, premium bills and tax documents, and keep the 1099-R and the prior-year return in the same folder. A shared list beats a good memory. Two years is a long gap between a tax decision and its Medicare bill.

Bring the Part B timing question to Edgepoint Wealth Management

Ask this: which tax years will Medicare review when I turn 65, and which planned Roth conversions or income draws fall in those years? Edgepoint Wealth Management can put the pension, second-career pay and proposed conversion on one calendar, so you can see what is known and what must wait for future Medicare figures.