If I understand your situation, you have nothing in your HSA to withdraw (or do you?). The IRS has not specifically addressed the situation that you are in - you are on Medicare, so can't contribute to your HSA, but don't have the dollars in the HSA to be able to withdraw the excess contribution - and you never will because you will never be able to contribute to your HSA again.
There is an ultimate solution: the 6% penalty is 6% of the smaller of your excess contributions still in your HSA OR the amount of money in your HSA on December 31 of the tax year. You see? Once your HSA balance goes to zero, so does the penalty. And TurboTax will ask in the interview specifically for the balance in your HSA at the end of the year.
OK, I made some assumptions about you. Tell me the rest of your situation (like how much remains in your HSA).
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