Key Takeaways

• Even though the government covers a significant portion of PSHB premiums, your out-of-pocket costs in 2025 may be much higher than expected due to copayments, coinsurance, deductibles, and prescription expenses.

• Medicare-eligible retirees who don’t coordinate with Medicare Part B may face higher cost-sharing under PSHB plans, particularly for services like hospitalization, outpatient care, and specialty drugs.

Understanding the Government Contribution: It’s Substantial, But Not Total

The Postal Service Health Benefits (PSHB) program for 2025 provides continued health coverage for postal employees and retirees. While the government pays approximately 70% of the total premium, you are responsible for the remaining 30%. That might sound manageable, but when viewed in the context of total healthcare costs, the numbers reveal a more complex picture.

The employee or annuitant share can still exceed $500 per month for family coverage. For individuals, the monthly premium share often falls in the $240 range. These amounts do not include copays, deductibles, coinsurance, or non-covered services—all of which contribute significantly to the actual financial burden.

Premiums Are Only the Starting Point

It’s important to remember that PSHB premiums are only part of the cost. What often gets overlooked are the indirect or “silent” costs you absorb throughout the year:

• Copayments for primary and specialty care

• Coinsurance for procedures and hospital stays

• Deductibles that must be met before coverage kicks in

• Out-of-network penalties

• Prescription drug cost-sharing beyond any flat copay tier

Each of these components adds another layer to your financial responsibility, particularly for retirees or families managing chronic conditions or specialized care needs.

What You May Be Paying Without Realizing It

Let’s break down the quieter costs that go beyond monthly premiums:

1. Copayments Add Up Quickly

In 2025, copayments for PSHB enrollees typically range from $20–$40 for primary care visits and $30–$60 for specialist visits. Urgent care and ER visits cost significantly more. If you visit a doctor just twice a month, you’re potentially spending over $1,000 per year just on copayments—and that’s before any labs or imaging.

2. Coinsurance Is a Bigger Burden for Serious Services

Coinsurance usually applies to services like outpatient surgeries, hospital admissions, or high-cost procedures. PSHB plans often require you to pay 20%–30% of the total cost in-network and more for out-of-network services. That percentage can represent thousands of dollars in just one hospitalization.

3. Deductibles Are Rising

Deductibles in 2025 PSHB plans range from $350 to $2,000 depending on the plan type (standard vs. high-deductible). You must meet these before many services are covered. Even low-deductible plans can create unexpected costs if you need care early in the year.

4. Out-of-Network Care Is Costly

If you accidentally use an out-of-network provider—or you need care while traveling—you could be on the hook for up to 50% coinsurance. Some plans also apply a separate out-of-network deductible, which adds to the financial pressure.

5. Prescription Costs: The $2,000 Cap Isn’t Universal

Medicare-eligible retirees benefit from the new $2,000 out-of-pocket cap on Part D prescription costs in 2025—but only if they are enrolled in both Medicare Part B and the PSHB-integrated EGWP (Employer Group Waiver Plan).

If you are not Medicare-enrolled, this cap does not apply to you, and prescription cost-sharing may exceed expectations. Additionally, non-formulary or specialty drugs can trigger percentage-based coinsurance rather than a flat fee.

How Medicare Coordination Can Lower Your PSHB Costs

Retirees who are eligible for Medicare and enroll in both Part A and Part B often see significant savings. Many PSHB plans offer:

• Lower copays and coinsurance when coordinated with Medicare

• Waived or reduced deductibles

• Automatic enrollment in Medicare Part D EGWP plans

• Integrated prescription benefits with access to the $2,000 cap

However, if you delay Medicare enrollment, you could miss out on these cost reductions and face coverage gaps or higher out-of-pocket costs.

The Reality for Postal Retirees Without Medicare Part B

If you retired before January 1, 2025, or qualify for an exemption, you may not be required to enroll in Medicare Part B. But skipping Part B means:

• Your PSHB plan becomes your primary payer

• You’re responsible for the full cost-sharing terms of the plan

• You may face higher inpatient and outpatient charges

• You miss access to the Medicare-integrated prescription cap

Over time, these cumulative costs can far outweigh the savings from avoiding the Medicare Part B premium.

You May Be Paying for Services You Never Use

Even if you don’t frequently visit doctors or take medications, your PSHB costs in 2025 still include funding benefits you may not personally use. These include:

• Maternity care

• Pediatric services

• Preventive screenings you may skip

• Behavioral health coverage

That’s not to say these benefits aren’t valuable—but it does mean your premium dollar is distributed across a wide set of services, not necessarily those that apply to you personally.

Cost Awareness Improves Plan Value

Understanding where your money is going can help you get better value from your PSHB coverage. Some strategies include:

• Choosing in-network providers

• Requesting generic medications where appropriate

• Scheduling preventive visits to catch issues early

• Comparing plans during Open Season based on your usage

Cost transparency can also help you decide if it’s time to coordinate with Medicare Part B—even if you’ve been hesitant in the past.

Watch for Hidden Triggers: Services That Seem Covered but Aren’t Fully

Certain services may be partially covered, leading to surprise bills:

• Outpatient therapies

• Durable medical equipment

• Diagnostic imaging

• Non-formulary prescriptions

These are often subject to coinsurance or separate limits. It’s crucial to check your plan brochure and ask questions before receiving services.

Staying Informed During Open Season

From November to December, you have the opportunity to make changes to your PSHB plan. If your health status or medication needs change—or you are approaching Medicare eligibility—it’s worth taking a close look at:

• Premium changes

• Copayment and coinsurance adjustments

• Deductible updates

• Medicare coordination rules

Annual Notice of Change documents help highlight these updates, and comparing plans can reveal better fits.

Where Your PSHB Premium Really Goes

Only part of your monthly payment goes directly to your own care. The rest contributes to a pool that helps fund services for all enrollees. This shared risk model is common in employer-sponsored insurance, but it can obscure how much you truly benefit from what you pay.

Some PSHB plans also use premium dollars for:

• Administrative costs

• Network management

• Health improvement programs

• Case management services

Understanding this broader distribution can help you assess whether you’re getting the support you need.

What You Can Do Right Now

To take control of your PSHB costs in 2025, consider the following steps:

• Review your current plan brochure: Look at copays, deductibles, and out-of-pocket maximums

• Evaluate your Medicare status: If eligible, consider enrolling in Part B to reduce PSHB costs

• Track your usage: Note how often you use services and whether you’re paying more than expected

• Call a licensed agent listed on this website: Get plan comparison support tailored to your health and financial situation

Understanding PSHB Costs Helps You Make Smarter Choices

Even with strong government support, PSHB enrollees in 2025 face rising personal healthcare expenses. The key is knowing where these costs originate, how they build up over time, and what you can do to control them. Awareness empowers you to optimize your benefits, avoid unnecessary spending, and make changes that work for your life.

Get in touch with a licensed agent listed on this website for help comparing PSHB plans or understanding your Medicare coordination options. A short conversation now could save you significantly in the long run.