Key Takeaways

• Medicare Advantage is not required for pshb members, and coordinating it with PSHB can lead to overlapping or redundant coverage if you’re not careful.

• Understanding how PSHB and Medicare Parts A and B work together in 2025 is critical before you consider adding a Medicare Advantage plan.

What You Need to Understand About PSHB and Medicare in 2025

If you’re a Postal Service retiree or employee transitioning into retirement, you’re now part of the Postal Service Health Benefits (PSHB) Program. As of January 1, 2025, PSHB replaces FEHB for all USPS workers and annuitants. While the new program promises tailored benefits, it also comes with new rules—especially when it comes to Medicare.

Once you turn 65, you’re expected to enroll in Medicare Part A and Part B if you’re Medicare-eligible and want to retain full PSHB benefits. But what about Medicare Advantage? On the surface, it might look like a smart way to supplement your care. But in reality, combining it with PSHB could be unnecessary—or even problematic.

Medicare Advantage Isn’t the Same as Original Medicare

Let’s clarify a key distinction first:

• Original Medicare refers to Part A (hospital insurance) and Part B (medical insurance).

• Medicare Advantage (Part C) is a private insurance plan that replaces Original Medicare and often bundles in extra benefits.

If you choose Medicare Advantage, you’re no longer using Original Medicare for your care. This alone creates a complication for PSHB coordination.

How PSHB Plans Work With Medicare Parts A and B

In 2025, PSHB plans are designed to integrate with Original Medicare—not Medicare Advantage. Here’s how they coordinate with Part A and Part B:

• Part A is premium-free for most and covers hospital stays. PSHB acts as secondary payer, reducing your out-of-pocket hospital costs.

• Part B covers outpatient care and has a monthly premium. PSHB plans typically waive or reduce copayments, coinsurance, and deductibles if you’re enrolled in Part B.

The goal is to have Medicare as your primary payer and PSHB as your secondary. This dual coverage leads to lower out-of-pocket costs—without needing a third layer like Medicare Advantage.

What Happens If You Add a Medicare Advantage Plan?

If you enroll in a Medicare Advantage plan, it takes over your Medicare coverage entirely. This creates two potential issues with PSHB:

• Redundant Coverage: You’re now paying for a Medicare Advantage plan that overlaps with PSHB. Both may cover the same services, but neither coordinates with the other.

• No Secondary Coverage From PSHB: PSHB no longer acts as your secondary payer when you have a Medicare Advantage plan. That means your Advantage plan is solely responsible for your costs.

In essence, you could be forfeiting the full value of your PSHB plan by choosing Medicare Advantage.

Are You Required to Stay on Original Medicare With PSHB?

For Medicare-eligible PSHB annuitants and family members, Part B enrollment is required to keep full PSHB benefits—unless you’re exempt. Some of the exemptions include:

• You retired on or before January 1, 2025 and aren’t already enrolled in Part B.

• You are age 64 or older as of January 1, 2025.

• You live abroad or have other qualifying coverage such as through the VA or Indian Health Service.

While you are not required to enroll in a Medicare Advantage plan, adding one may interfere with your PSHB coordination.

Why PSHB Doesn’t Coordinate With Medicare Advantage

There’s a structural reason behind this: Medicare Advantage plans are standalone replacements for Medicare. When you join one:

• You receive all Medicare-covered benefits through the private plan.

• Original Medicare stops paying.

• PSHB plans are not designed to work with these replacements—they are built to wrap around Parts A and B.

So while you may think you’re adding extra coverage, you’re really creating a siloed benefit structure.

Prescription Drug Coverage: Another Layer of Confusion

All PSHB plans for Medicare-eligible members in 2025 include a Medicare Part D Employer Group Waiver Plan (EGWP). This provides automatic drug coverage through your PSHB plan.

But if you enroll in a Medicare Advantage plan that includes drug coverage:

• You may automatically be disenrolled from your PSHB prescription plan.

• Or you may have to choose between your PSHB EGWP and the Medicare Advantage drug plan.

This dual enrollment isn’t just complex—it can also leave you without the plan you intended to keep.

Financial Considerations in 2025

When you’re coordinating benefits, cost matters. In 2025:

• The Medicare Part B premium is $185 per month.

• PSHB plans may reduce your out-of-pocket costs if you enroll in Part B.

• Adding Medicare Advantage might involve additional premiums—on top of what you’re already paying for PSHB.

You need to ask yourself: Are you getting additional value for that extra premium—or are you duplicating services?

When Might Medicare Advantage Make Sense With PSHB?

There are very few scenarios where combining Medicare Advantage with PSHB might be useful, but it’s not common. Potential examples include:

• If you disenroll from PSHB and go with Medicare Advantage exclusively.

• If your Medicare Advantage plan offers a unique supplemental benefit that PSHB lacks—and you’re willing to absorb the cost.

However, these are exceptions. For most Postal retirees and employees, sticking with Original Medicare + PSHB is the most coordinated and cost-effective route.

PSHB Already Includes Many Benefits

One of the key reasons people consider Medicare Advantage is for perks like dental, vision, or fitness memberships. But in 2025:

• Most PSHB plans already include vision and dental coverage.

• You may already have access to wellness programs or care management support.

• Your plan includes the protection of an employer-sponsored benefit structure, which may be more stable and predictable than private Advantage plans.

Before adding anything new, make sure you understand what you already have.

What You Should Do Before Enrolling in Any Medicare Advantage Plan

Before making a decision, ask yourself the following:

• Have you confirmed how your PSHB plan works with Medicare Parts A and B?

• Have you reviewed whether your Medicare Advantage plan conflicts with PSHB benefits?

• Do you understand the prescription drug implications?

• Are you willing to pay two premiums for overlapping coverage?

If the answer to any of these is unclear, hold off enrolling in a Medicare Advantage plan until you get help.

Getting the Right Advice Can Save You Thousands

This isn’t just about preferences—it’s about real money and real access to care. Choosing the wrong combination can:

• Leave you paying more out-of-pocket

• Disenroll you from PSHB prescription benefits

• Reduce your access to providers

• Void key cost-sharing protections built into the PSHB+Medicare model

How to Make Medicare and PSHB Work for You in 2025

By default, PSHB and Medicare are designed to work together—with Medicare as the primary and PSHB as the secondary. You don’t need to complicate that formula with Medicare Advantage unless you fully understand the implications.

Instead:

• Enroll in Medicare Parts A and B at age 65 (unless exempt).

• Confirm your PSHB plan includes prescription drug coverage through EGWP.

• Use PSHB’s cost-sharing protections to minimize your out-of-pocket expenses.

This combination gives you layered protection and value—with less risk of losing benefits or creating redundant coverage.

Make the Most of Your Coverage—Without Overpaying

If you’re unsure whether adding Medicare Advantage on top of PSHB makes sense, stop and evaluate your actual needs. The system in 2025 is already structured to support you well with Original Medicare and PSHB together. Avoid paying for coverage you don’t need.

Speak to a licensed agent listed on this website to walk through your situation. They can help you clarify what’s required, what’s optional, and what’s worth your money.