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I have been using the VA to get my prescriptions for awhile.  Once my Medicare begins can I continue that service or will I have to get a Part D coverage?  If I have VA and don’t get a Part D coverage will I incur a penalty?

If you have VA benefits and are receiving your medications from them then you can continue to use this service once Medicare begins.  In fact, in a lot cases the coverage you can get from VA is better than what you can get from Medicare.  The biggest issue with regard to the VA is that it can take them some time to get you a new prescription whereas with Part D you can go to any local pharmacy and pick up the new medicine immediately.

With regard to a penalty, no, you will not incur a penalty for not having a Part D coverage so long as you have VA.  The VA has been deemed credible coverage thereby waving the penalty.