Key Takeaways

• The shift to Medicare Part B requirements and drug benefit changes under the PSHB program could impact your out-of-pocket costs, especially if you’re a retiree or near retirement.

• Understanding what stays the same and what changes in 2025 helps you avoid gaps in coverage or penalties, and prepares you for smarter decision-making during Open Season.

What Makes 2025 a Pivotal Year for PSHB and Medicare

If you’re a United States Postal Service (USPS) employee or retiree, 2025 isn’t just another year—it marks a major shift in how your health benefits work, especially when Medicare enters the picture. With the official rollout of the Postal Service Health Benefits (PSHB) program replacing FEHB for postal workers, it’s important to understand how your Medicare benefits now tie into it.

Whether you’re already retired or planning to retire soon, ignoring these changes could lead to higher healthcare costs, lapses in coverage, or missed opportunities for savings. Here’s how 2025 Medicare changes are shaping your PSHB experience—and what steps you should take right now.

Medicare Part B Is Now Required for Most Annuitants

Under the PSHB program, if you’re a USPS retiree or annuitant who is eligible for Medicare, you’re now required to enroll in Medicare Part B to keep your PSHB plan active.

Who This Affects:

• Retirees who turn 65 in 2025 or later.

• Retirees who were not already enrolled in Medicare Part B by January 1, 2024.

Who’s Exempt:

• If you retired on or before January 1, 2025 and were not enrolled in Part B, you’re not required to enroll now.

• Also, if you are still an active USPS employee turning 65 in 2025, the requirement kicks in only when you retire.

Failing to enroll in Part B when you’re required could lead to losing your PSHB coverage, and late enrollment penalties from Medicare can follow you for life.

Your Prescription Coverage Now Falls Under Medicare Part D

One of the biggest changes in 2025 is how your drug benefits are handled. If you’re Medicare-eligible, your PSHB plan now includes a Medicare Part D Employer Group Waiver Plan (EGWP).

What This Means:

• You don’t need to sign up for a separate Part D plan—it’s bundled with your PSHB plan.

• There’s a new $2,000 cap on out-of-pocket prescription drug costs under Part D.

• Once you reach that $2,000, your plan covers 100% of approved drug costs for the rest of the year.

This is a huge relief if you use expensive medications, and it’s one of the few financial protections that kicks in automatically once you hit the cap.

Coordination of Benefits: Medicare and PSHB

If you’re enrolled in both Medicare and a PSHB plan, Medicare is now your primary payer, and PSHB acts as secondary coverage. This setup can save you a lot on deductibles and copayments.

Here’s how this coordination works in 2025:

• Medicare Part A and B handle your hospital and outpatient expenses first.

• Your PSHB plan steps in to cover remaining eligible costs, often reducing or eliminating what you’d pay out of pocket.

The better you understand this coordination, the easier it is to choose the right PSHB plan that complements your Medicare coverage and minimizes total expenses.

Open Season Is Still Your Time to Review and Adjust

Even with the Medicare integrations, Open Season still runs from November to December, and you’ll have a chance to:

• Compare PSHB plan options.

• Switch plans if needed.

• Add eligible dependents or adjust coverage levels.

Don’t ignore this window. It’s your best shot at making sure your healthcare coverage lines up with your retirement goals, medical needs, and budget.

If You’re Still Working: What You Should Know

Still employed by USPS and not yet retired? You’re not affected by the Medicare Part B requirement until you retire. But that doesn’t mean you should sit back and wait.

Here’s what to do now:

• Track your 65th birthday—Medicare eligibility starts then, even if you’re still working.

• Prepare to enroll in Part B as soon as you stop working or retire.

• Check your PSHB options ahead of time so you can plan for the right transition.

Proactive planning makes the retirement process smoother and helps avoid any breaks in coverage.

Big Savings Are Possible—But Only If You Coordinate Wisely

PSHB plans in 2025 often offer financial incentives for retirees who enroll in Medicare Part B. These can include:

• Waived or reduced deductibles.

• Lower copayments.

• Enhanced coordination for prescription drugs.

If you delay enrolling in Part B, you’ll lose out on these potential savings—and once you enroll late, the penalty sticks around forever. The earlier you align your Medicare and PSHB plans, the better off you’ll be.

Costs to Watch in 2025

Understanding the general cost landscape in 2025 can help you budget and make informed decisions:

• Medicare Part B premium: The standard premium is $185/month.

• Part B deductible: $257 annually.

• Part A deductible: $1,676 per benefit period.

• Part D (drug coverage) deductible: $590 max, but capped at $2,000 total out-of-pocket costs.

These numbers matter because your PSHB plan takes these into account when designing their cost-sharing structure. Knowing them helps you identify which plan gives you the best value.

What If You’re Already on FEHB and Medicare?

If you’re already retired and enrolled in FEHB and Medicare, you’ve likely been automatically moved to a similar PSHB plan. You’ll still get a chance to change plans during Open Season if you’re not satisfied with the auto-assigned plan.

Take the time to compare:

• Premium contributions.

• Specialist and primary care copays.

• Prescription drug coverage details.

Even though the names of the plans may sound familiar, coverage can differ from what you had under FEHB.

Dependents and Family Coverage Rules Haven’t Changed Much

Even with all these Medicare shifts, your family coverage under PSHB remains largely the same:

• Spouses and eligible children can still be covered.

• If you have a family member who’s also Medicare-eligible, make sure they enroll in Medicare Part B to avoid losing coverage.

• Coordination applies per person: Medicare is primary for those eligible, PSHB is secondary.

Don’t assume your coverage decisions apply to the whole family equally. Everyone’s eligibility status matters.

Automatic Enrollment vs Active Choice

If you were already enrolled in an FEHB plan in 2024, you’ve likely been automatically enrolled in the equivalent PSHB plan in 2025. But that doesn’t mean it’s the best fit for your needs this year.

Here’s what to do:

• Review your new PSHB plan details carefully.

• Don’t settle for automatic—take action during Open Season if something doesn’t align with your expectations.

• Check for new Medicare-related benefits that weren’t part of your old plan.

You don’t want to leave money or benefits on the table just because you didn’t look closely.

Planning Ahead for a Smoother Transition

The biggest mistake you can make is assuming that everything will take care of itself. These changes bring both opportunities and responsibilities.

Here are a few things to do now:

• Confirm your Medicare eligibility and enrollment status.

• Review your PSHB plan’s coordination with Medicare.

• Mark your calendar for Open Season—November to December.

• Talk to a licensed agent if you’re confused or uncertain.

Even if you’re still working, starting this process early ensures a better fit when retirement comes.

Make Smart Moves Now So You Don’t Pay Later

The changes to Medicare and PSHB in 2025 bring better drug coverage, tighter integration between plans, and more control over out-of-pocket costs—but only if you act. Whether you’re a USPS retiree, nearing retirement, or still working, knowing your options gives you the power to make smart decisions.

Don’t let automatic enrollment lull you into complacency. Review your benefits, align your Medicare choices, and get help from a licensed agent listed on this website if you want to make the most of what’s available.