Key Takeaways

• Medicare Advantage plans often appear more generous than they are, especially when compared side-by-side with your PSHB plan.

• PSHB enrollees who assume Medicare Advantage will enhance their benefits may face network restrictions, prior authorizations, and higher out-of-pocket costs in practice.

The Allure of Medicare Advantage

On paper, Medicare Advantage plans in 2025 offer an enticing combination: they bundle Medicare Part A and Part B coverage with added perks such as vision, dental, hearing, and sometimes fitness benefits. For Postal Service Health Benefits (PSHB) enrollees, these extras can seem like a great supplement to traditional Medicare.

However, the appeal often masks limitations that don’t become apparent until you need care. If you’re weighing Medicare Advantage against sticking with your PSHB plan (or coordinating it with Original Medicare), it’s essential to understand what you could be giving up.

What Medicare Advantage Leaves Out

Medicare Advantage plans must cover everything Original Medicare does, but how they deliver that coverage varies significantly. And the method matters—especially when you’re already covered under a PSHB plan that works nationwide and typically offers broader access.

Here’s what you may not realize:

• Network restrictions: Unlike PSHB plans, which often cover in-network and out-of-network providers, Medicare Advantage plans are generally limited to a regional provider network. Care outside the plan’s service area might not be covered unless it’s an emergency.

• Prior authorizations: For many non-emergency procedures, services, or specialist visits, Medicare Advantage plans may require prior approval, which can delay your care or even result in denials.

• Referral requirements: Some Medicare Advantage plans operate under a managed care model that mandates referrals to see specialists, whereas your PSHB plan likely offers more direct access.

• Changing benefits annually: While your PSHB coverage remains relatively stable year over year, Medicare Advantage plans can change their benefits, premiums, copays, and coverage areas every January.

The Financial Side: Comparing Out-of-Pocket Costs

The 2025 landscape continues to see rising healthcare costs, and Medicare Advantage plans are not immune to this trend. Even though some of these plans might promote low premiums, your overall spending could still be higher.

Consider these cost categories:

• Deductibles and copayments: Medicare Advantage plans may advertise low premiums, but they often come with copayments for every visit, service, or prescription. PSHB plans, especially when paired with Medicare Parts A and B, often waive or significantly reduce out-of-pocket costs.

• Out-of-pocket maximums: In 2025, the out-of-pocket limit for Medicare Advantage plans is up to $9,350 for in-network care. That figure doesn’t include out-of-network expenses or monthly premiums.

• Prescription coverage: Medicare Advantage plans typically include Part D, but the drug formulary might be limited. PSHB plans offer integrated prescription coverage that, when combined with Medicare Part B, often provides better access and lower costs.

PSHB + Medicare: Why This Pairing Still Works Best

If you’re a Medicare-eligible annuitant or family member under PSHB, you might wonder whether it’s worth sticking with your PSHB plan once you enroll in Medicare. The answer is usually yes—especially when it comes to coordination of benefits.

Here’s what you gain:

• Waived or reduced cost-sharing: Many PSHB plans coordinate with Medicare Part B to reduce or eliminate deductibles, copays, and coinsurance.

• Nationwide coverage: PSHB plans typically do not have geographic restrictions. Whether you’re traveling or living part of the year in another state, your access to care stays consistent.

• No disruption to care: You keep seeing the providers you know and trust, without needing to switch networks or seek new referrals.

• Integrated drug coverage: PSHB plans automatically include Medicare Part D coverage via an Employer Group Waiver Plan (EGWP), which offers enhanced access to medications and caps annual out-of-pocket spending at $2,000 for 2025.

What Gets Missed in the Fine Print

Too often, decisions about Medicare Advantage are based on marketing materials that highlight the positives while burying the caveats. Here are a few commonly overlooked details:

• Service area limitations: Once enrolled in a Medicare Advantage plan, you’re locked into that plan’s service area unless you move or qualify for a Special Enrollment Period. This poses challenges for retirees who split their time between states.

• Mid-year disenrollment restrictions: Outside of the Medicare Advantage Open Enrollment Period (January 1 to March 31), you can’t switch to another Medicare Advantage plan or go back to Original Medicare unless you qualify for a Special Enrollment Period.

• Benefit changes each year: What you liked about your Medicare Advantage plan in 2024 might not be true in 2025. PSHB plans, by contrast, offer more consistent benefits.

Understanding the Coordination Rules

If you opt for Medicare Advantage, it becomes your primary payer. Your PSHB plan will usually not coordinate benefits with it, meaning you’ll lose access to many PSHB cost-saving features. By contrast, if you stay with Original Medicare and enroll in Part B, your PSHB plan will function as secondary payer—often covering what Medicare doesn’t.

That difference can be substantial:

• With Original Medicare + PSHB: Medicare pays first, PSHB pays second. You could pay almost nothing out-of-pocket.

• With Medicare Advantage only: PSHB benefits are sidelined or inapplicable. You’re fully subject to the Medicare Advantage plan’s cost structure and coverage rules.

Annual Election Periods: Timing Matters

From October 15 to December 7 each year, you can switch Medicare Advantage plans or return to Original Medicare. But for Postal retirees, PSHB Open Season also runs from November to December. The overlap is crucial.

Here’s what to keep in mind during this dual window:

• Review your PSHB plan’s updated brochure and the Annual Notice of Change from any Medicare plan you’re considering.

• Be cautious about making a change based solely on lower premiums.

• Consider how coverage works when you travel, see specialists, or need medications regularly.

• Ensure you understand how your current plan coordinates with Medicare Parts A and B.

Medicare Advantage Extras Aren’t Always Worth the Trade-Off

One of the biggest draws of Medicare Advantage plans is the promise of extra benefits like:

• Dental and vision coverage

• Fitness memberships

• Transportation to appointments

• Over-the-counter allowances

However, these extras come with strings attached:

• They might be limited to specific vendors or facilities.

• They can be removed or reduced annually.

• They may come at the expense of broader healthcare access or higher copays.

Compare this to PSHB plans, many of which also offer supplemental benefits but without the same level of restrictions or annual variability.

Protecting Your Healthcare Access in Retirement

Making Medicare-related decisions isn’t just about costs—it’s about protecting your ability to receive care when you need it. That includes:

• Keeping your choice of providers and facilities

• Avoiding care delays due to authorizations or network limitations

• Ensuring your drug coverage remains uninterrupted

In 2025, Medicare Advantage plans still come with too many variables to be a safe default choice for PSHB annuitants. When combined with your PSHB plan, Original Medicare offers a more predictable and portable healthcare experience.

Why Clarity and Caution Matter

It’s easy to be swayed by Medicare Advantage marketing. Promises of convenience, perks, and savings can be appealing—especially when you’re juggling multiple options during the Open Season. But the trade-offs often become apparent only when it’s too late to switch.

As a Postal retiree or eligible family member, your PSHB plan is built to coordinate with Medicare. Rather than replace it, Medicare Advantage could disrupt it. Understanding what’s truly being offered—and what’s left out—is essential to making the best decision for your health and budget.

If you’re unsure about how Medicare and PSHB work together or whether you should consider any change, get in touch with a licensed agent listed on this website for personalized support and up-to-date guidance.