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Many Americans who live overseas have contributed to Medicare for at least ten years and qualify for coverage, but they cannot receive care while abroad. While premium-free Part A (hospitalization) can be used while in the USA and paying Part B premiums would give access to doctors during visits there USA, prescription drugs would have to be paid out-of-pocket because non-residents may not subscribe to Part D.

(A partial exception to these restrictions on care while abroad is made for eligible military retirees and their dependents).

AARO maintains that civilian Americans whose contributions make them eligible for Medicare and who wish to travel or reside abroad should receive health care access, just as they receive Social Security retirement benefits in return for the payments they and their employers have made over the years. Solutions to quality of care assurance and payment mechanisms are available.

Another issue concerns the financial penalty imposed on Americans who enroll in Medicare after their initial months of entitlement. AARO contends that an overseas American who decides to reestablish US residence and who has been covered by medical insurance abroad should be able to sign up for Medicare without penalty upon return to the U.S., regardless of age.

For a more detailed analysis of the issue, please consult AARO's Position Paper on Medicare.

Medicare for Overseas Americans

Americans who travel or live abroad cannot have medical treatment received outside the United States covered by Medicare even though they have fully contributed to the program. Medicare recognizes no providers outside of the U.S. and has not implemented a method for reimbursement, despite ample evidence that qualified care is available abroad, usually at lower cost. Medicare-enrolled Americans must travel to the U.S., often in poor health or suffering an acute condition, to receive the covered care for which they have paid.

Unlike most seniors, retired military veterans and their families living abroad do have access to covered care under the Tricare Overseas Program-Tricare For Life (TOP TFL). By statute, these military beneficiaries must be enrolled in Medicare Parts A and B, but since Medicare does not cover them abroad, TOP TFL serves as the primary coverage, reimbursing for reasonable, scheduled medical expenses incurred at host nation providers (local, private providers that have been approved by Tricare). Upon submission of proper claims, reimbursement amounts to 75% of expenses incurred.

The military’s Tricare coverage is evidence that administration of cross-border healthcare coverage is practicable and thus that Medicare could function abroad. Tricare’s program as administered by the Wisconsin Physicians Service is not only effective – it has encouraged the adoption of medical standards recognized as meeting Medicare criteria in Mexico.

Lower Costs

The prevailing rationale in Congress holds that (1) cost control and effecting payments for medical services abroad would be too complex, and (2) compliance with Medicare standards by foreign medical facilities and personnel cannot be ensured. These objections govern the thinking of the Centers for Medicare & Medicaid Services (CMS). In practice, medical costs outside the USA are almost invariably lower, even in countries with a high cost of living such as France, Germany and Switzerland. 

Failure to cover qualified Americans abroad may cost Medicare a chance to save money and thus be financially counterproductive.

  1. Beneficiaries often receive treatment anyway, by traveling back to the USA, where Medicare may pay more for the same procedures because of higher healthcare charges in the USA.
  2. If preventive services abroad are not as extensive as under Medicare, especially given the expanded provisions of the Affordable Care Act, illnesses may have reached a more serious and costly stage before treatment in the USA is sought. If Medicare were available abroad, early diagnosis and preventive care could be provided at low cost where eligible beneficiaries live.

In addition to lower charges for medical acts, many countries have lower claims and billing costs. They may achieve this by having a single payer system, well-integrated processing and payment by primary or supplementary insurers, fairly uniform rates or some combination of these. Medicare would benefit from these medical accounting practices.

International Experience

The difficulties of assuring care quality and financial oversight are surely exaggerated. Many countries have treatment standards at least equal to those in the USA. There are both national and international accreditation organizations overseeing practitioners and care institutions.

Cross-border coverage and payment is hardly novel. In the United States, as elsewhere, insurance companies cover the urgent medical needs of travelers to almost any country. Ironically, even US-resident Medicare beneficiaries who require emergency treatment while abroad are covered by Medicare Advantage and Medigap insurers. The European Union has resolved the issues and its citizens enjoy medical care reciprocity in any of the 28 member countries, based upon the fact that they are covered in their home country.

International coverage is only growing, driven by globalization, medical “tourism,” and retirement abroad. There is no reason for Medicare to be the last to implement it.

Automate Health Care Information

The Obama Administration has already focused on the need to automate health care information, particularly patient medical records. As Americans resident overseas, we have considerable experience with different systems in Europe, and are impressed with the efficiency, security and cost savings that such automation has yielded to the health care systems of these countries. Automated records reduce the inefficiencies of duplicate paperwork, control the use of prescription drugs, track allergies and other conditions, and speed up the transfer of data for use by providers. We would welcome the opportunity to assist DHHS in facilitating such a review.

Financial Penalty

Pending resolution of Medicare coverage abroad, there is the issue of the 10% per year premium penalty applied to Americans who, because they decide to reestablish residence in the USA or for other legitimate reasons, enroll in Medicare Part B after their initial months of entitlement at age 65.

Overseas Americans associations contend that an American covered by medical insurance abroad after age 65 (or disabled) should be able to sign up for Medicare Part B without penalty, regardless of age. In other words, similar conditions should apply to Part B as to Part D, where there is no penalty if a person subscribed to “creditable” prescription coverage while living abroad. Since the American has not been able to be treated under Part B while outside the country, the penalty for late enrollment is unreasonable and punitive.


The United States should honor its commitment to civilian Americans who have contributed to Medicare by extending healthcare coverage to eligible persons while they are outside the USA.

Methods for entitling Americans abroad to benefit from medical coverage exist. We respectfully request Congress and the Executive to find an appropriate solution for the medical needs of American civilians abroad.

As a first step we propose that a Medical Research and Demonstration Project be funded to examine relevant medical costs, services, payments and oversight methods. This would provide the data needed to design medical coverage and reimbursement programs for civilians abroad.


Supplementary medical coverage

In a small victory for AARO, the Regional Officer of the US Social Security Administration in Rome has confirmed that Americans who have supplementary medical coverage from a private insurance organization (mutuelle) as part of their employment in France at age 65 or later will not be penalized for late enrollment in Medicare Part B when they later retire and seek enrollment in Medicare.

She added that a non-working spouse may likewise benefit from this interpretation if she/he is covered by the working spouse’s mutuelle. The question was raised at our Social Security and Medicare conference last June because failure to enroll in Part B when a person becomes eligible for it will usually result in a late-enrollment penalty if that person wishes to apply at a later time, and it was clear that coverage by the French Social Security system did not qualify to bar the penalty.

It should be noted, however, that AARO members outside of France may find their situation to be different, since mutuelles in France are private/semi-private entities and supplementary insurance in other countries may not be comparable. Nevertheless, the door is now open to exploring whether employer health plans in other countries may similarly qualify.

Submitted by: Thomas Rose


Support sought for Demonstration Project for Medicare coverage in Mexico

Americans for Medicare in Mexico, A.C. (AMMAC) is a legally constituted Mexican non-profit organization dedicated to bringing Medicare coverage to eligible seniors living in Mexico. The aim of the organizations is to promote and attain U.S. Congressional authorization for a Demonstration Project for Medicare in Mexico.

Read more: Support sought for Demonstration Project for Medicare coverage in Mexico


FYI - Medicare News

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