Decisions about Medicare enrollment can be complicated if you live outside the United States. Living outside the U.S. means you do not live in the 50 states, the District of Columbia, Puerto Rico, the Virgin Islands, Guam, American Samoa, or the Northern Mariana Islands. Although Medicare does not typically cover medical costs you receive when you live abroad, you still need to choose whether to enroll in Medicare when you become eligible or to turn down enrollment. This requires considering:
- Whether you plan to return to the U.S.
- Whether you are working or volunteering outside the U.S.
- The potential costs of delayed enrollment
If you are 65 or older and qualify for Medicare, you can enroll in Medicare Parts A and B, also known as Original Medicare, either before or after you leave the U.S. Remember, though, that Medicare will typically not cover any medical care you receive outside the U.S. Since most people pay no premium for Part A coverage, it is usually best to keep Part A, even if you are moving abroad, because it is free. If you do not qualify for premium-free Part A, you may only be able to enroll in Medicare if you live in the U.S. To have Part B coverage, you must pay the monthly Part B premium. You may want to keep Part B if you plan to move back to the U.S. in the future or visit frequently. This is because paying the premium to keep Part B when abroad will ensure that Medicare will cover your care whenever you travel to the U.S., and that you will not face premium penalties or gaps in coverage.
If you fail to pay for Part B while abroad, when you move back to the U.S. you may go months without health coverage. This is because you may have to wait until the General Enrollment Period (GEP), which runs January 1 through March 31 each year, with coverage starting the first of the month after the month you enroll.
If you have a Medicare Advantage or Medicare Part D plan before you move abroad, you should disenroll and stop paying these premiums when you move because these plans require that you live in their service area in order to be enrolled.
Note that this information only applies if you are living abroad; it does not apply if you are simply taking a trip. If you have specific questions, contact the Social Security Administration (800-772-1213) or the Consulate or Embassy in your country of residence before making any final decisions about Medicare enrollment.
Maintaining Healthcare Insurance as a Retiree Abroad
A common challenge faced by U.S. citizens who retire abroad is how to access healthcare insurance in their new country of residence. While it’s possible to qualify for Medicare as a U.S. expat, your overseas benefits may be extremely limited. Here’s what you need to know about Medicare as an American retiree abroad.
Medicare requirements for U.S. expat retirees
U.S. expats eligible for Medicare typically must meet two basic requirements to maintain Part A and B coverage:
- Maintain citizenship or legal status in the United States
- Remain current on Part B premiums
Deciding whether to maintain coverage
It’s important to understand that Medicare typically doesn’t provide coverage for healthcare expenses incurred overseas. This means you may need to enroll in private insurance or your country of residence’s public healthcare system (if eligible).
There’s no late enrollment penalty for Medicare Part A if you qualify for premium-free coverage. However, you may face a late enrollment penalty if you’re subject to Part A premiums, let your benefits lapse, then purchase coverage at a later date. In this scenario, it may make sense to maintain Part A coverage while living overseas.
On the other hand, Medicare Part B requires retirees to pay a monthly premium to maintain coverage. While this may seem like an unnecessary expense due to a lack of overseas coverage, it often makes sense to continue paying premiums to maintain Part B coverage.
If you ever plan to return to the United States, you’ll have a one-time special enrollment period to enroll in the remaining pieces of Medicare coverage. This special enrollment window will last 63 days from your move date. Please note there could be the risk of a late enrollment penalty for Medicare Part D; however, you can attempt to appeal it. Medicare supplement plans won’t have a special enrollment period, and you may need to qualify through health underwriting.
Consider the following examples.
- Scenario 1 – Susan and her husband are U.S. expats living in Spain. While there, Susan’s husband passes away. Susan decides to return to the United States to be closer to family. Because she maintained Medicare Part A and B coverage the entire time she lived overseas, Susan is eligible to set up Part D drug coverage on the first day she returns stateside — but there may be a risk that she’d incur a late enrollment penalty. She can also apply for a Medicare supplement plan and, assuming she meets the necessary eligibility requirements, start the coverage immediately or on the first of the next month. Many Medicare supplement carriers can start providing coverage on the day of the application being submitted. It may take a few days or a few weeks for the policy to be approved, but once approved the coverage would be retroactive.
- Scenario 2 – Susan and her husband decide to discontinue their Medicare Part B coverage after retiring in Spain as U.S. expats. When her husband passes away, Susan returns to the United States and must wait until the Medicare general enrollment period to receive coverage. She’s also subject to a Part B late enrollment penalty, which is added to her monthly premium for as long as she has coverage. In this scenario, because her Medicare Part B coverage has a new effective date (as she waited for general enrollment), Susan will have a new open enrollment window and can qualify for a Medicare supplement plan without going through medical underwriting.
- Scenario 3 – Susan is a non-U.S. citizen and her husband, who is an American citizen, passes away. Because her husband qualified for Social Security and they were married for at least one year, Susan may be eligible for Medicare as a non-U.S. citizen spouse, depending on her specific situation.
Susan’s hypothetical situations highlight the advantage of maintaining Medicare coverage, whether for herself or as non-U.S. citizen spouse, if there’s a possibility she may decide to live in the United States in the future.
Considerations for those not eligible for Part A coverage
If you don’t meet the eligibility requirements for premium-free Part A coverage (which typically means you or your spouse didn’t pay Medicare taxes for at least 40 quarters), you might still be able to enroll in Medicare Part A and Part B — however, you would need to pay premiums for both parts. You can confirm this through your local U.S. Embassy.
If you were living outside the U.S. when you turned 65 and don’t qualify for Social Security benefits, then upon returning to the United States as a permanent resident, your special enrollment period will begin (lasting for three months). Your coverage begins on the first day of the month after you enroll.
If you don’t enroll within the three-month window, you may be subject to a late enrollment penalty. The penalty is 10% of the Medicare premium cost (be aware that premiums can change every year). For 2025, the Part B cost is $185.00 and Part A can be between $285 and $518 (depending on how many credits you have).
Please note, if you’re a U.S. expat who qualifies for an income-related monthly adjusted amount (IRMAA), the penalty will factor in that surcharge as well.
Eligibility to delay coverage
You may be eligible to delay enrolling in Medicare Part B and avoid both premiums and a late enrollment penalty if you have health insurance coverage from any of the following and are actively working or volunteering:
- A sponsoring organization of volunteer service
- An employer for which you or your spouse actively work that provides creditable group health insurance coverage.
Once you stop working and are no longer eligible for coverage, Medicare allows for an eight-month special enrollment period (SEP), during which time you can enroll without triggering a late enrollment penalty. If you were previously receiving coverage as a volunteer, the SEP is reduced to six months.
If you stop working/volunteering and don’t return to the United States during your SEP, you’ll face the same dilemma as other expat retirees in that you must decide whether to sign up for Part B and pay premiums or let your coverage lapse and face permanent late penalties when you return to the United States.
This article was written by the pros at Creative Planning.
This material was developed and prepared by a third party for use by your Registered Representative. The content is developed from sources believed to be providing accurate information. Cetera Advisors LLC cannot guarantee or represent that it is accurate or complete.
