Key Takeaways

• You may end up paying significantly higher copays under PSHB if you overlook critical plan coordination rules, especially those involving Medicare Part B.

• Avoidable out-of-pocket costs can be reduced simply by understanding and meeting specific PSHB requirements tied to Medicare eligibility and enrollment.

A Critical Shift in How PSHB Works in 2025

The Postal Service Health Benefits (PSHB) program has fully replaced FEHB for USPS employees and retirees in 2025. While many of the core features remain similar, some rules are very different—and some can lead to unexpected expenses if not followed. One of the most impactful rules involves how copayments are handled based on whether you’re enrolled in Medicare Part B.

If you’re eligible for Medicare but don’t enroll in Part B as required, you might face significantly higher out-of-pocket costs through copayments. This rule is not optional, and its financial consequences are real.

Understanding Copayments Under PSHB

Copayments are fixed amounts you pay for specific healthcare services. Under PSHB, copay amounts generally range between $20 and $150 per visit, depending on the type of service:

• Primary care visits: $20-$40

• Specialist visits: $30-$60

• Urgent care: $50-$75

• Emergency room: $100-$150

These copays apply to in-network providers. If you receive care outside of your plan’s network, you could face higher copays and even coinsurance. But the biggest price jump happens when Medicare Part B is missing.

What the Rule Actually Requires

In 2025, PSHB enforces a strict coordination of benefits rule. If you’re a Medicare-eligible annuitant or family member, you must enroll in Medicare Part B to avoid full cost-sharing responsibility under your PSHB plan.

This rule applies if you:

• Are age 65 or older and eligible for Medicare,

• Are a USPS annuitant or eligible family member,

• Are not exempt from the Part B enrollment requirement (exemptions apply if you retired on or before January 1, 2025, or meet other criteria).

Failing to enroll in Medicare Part B when required triggers a shift in how PSHB plans pay your claims. Instead of assuming that Medicare pays first, your PSHB plan assumes full responsibility. However, the cost-sharing structure changes—often resulting in higher copays or full charges.

Why Medicare Part B Matters So Much in 2025

Medicare Part B covers outpatient medical services, like doctor visits, preventive care, durable medical equipment, and outpatient surgeries. When you’re enrolled in both PSHB and Medicare Part B, your plan coordinates with Medicare:

• Medicare pays first (primary payer).

• PSHB pays second (secondary payer).

• Your out-of-pocket costs are generally reduced.

But if you skip Medicare Part B when required, your PSHB plan becomes the sole payer. This can lead to:

• Higher copays,

• Loss of reduced cost-sharing benefits,

• Responsibility for charges that would otherwise be covered.

Penalties That Add Up Quickly

Let’s break down the types of penalties or increases in costs you may face under PSHB if you miss the Part B rule:

• Emergency room visits could cost you the full bill instead of a capped copay.

• Specialist visits may jump from a $60 copay to hundreds of dollars in uncovered fees.

• Outpatient procedures could involve coinsurance rather than a predictable copay.

The shift from capped copays to percentage-based coinsurance or full billing can be financially painful—especially if multiple services are needed in a year.

Who Is Exempt from the Rule?

Some annuitants and dependents are exempt from the Medicare Part B enrollment requirement under PSHB. As of 2025, you are exempt if:

• You retired on or before January 1, 2025,

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

• You reside outside the United States,

• You are eligible for health care from the Indian Health Service or Veterans Affairs.

Even if you are exempt, you may still benefit from enrolling in Medicare Part B, but you’re not required to in order to maintain full PSHB benefits. Everyone else must comply to avoid penalties.

How This Rule Is Enforced

PSHB plans receive data on your Medicare enrollment status through coordination with CMS (Centers for Medicare & Medicaid Services). If your status shows you’re eligible for Medicare and not enrolled in Part B, your plan will apply full cost-sharing rules:

• Denied secondary benefits

• No cost-sharing reductions

• Standard provider charges apply

This enforcement occurs automatically and doesn’t require a manual check or request from your provider. That means you might be surprised at billing statements if you’re not properly enrolled.

When and How to Enroll in Medicare Part B

You must enroll in Medicare Part B during your Initial Enrollment Period around your 65th birthday, or during a Special Enrollment Period if you delayed enrollment due to active employment. If you miss these windows, you’ll need to wait for the General Enrollment Period (January 1 to March 31) and coverage won’t start until July.

Delaying enrollment can also lead to permanent late enrollment penalties on your Medicare Part B premium, making it even more costly over time.

What You Can Do to Protect Yourself

Here’s how to avoid unexpectedly high PSHB copays:

• Confirm your Medicare eligibility by checking with the Social Security Administration.

• Enroll in Medicare Part B before your PSHB plan requires it.

• Review your PSHB plan brochure to understand how cost-sharing changes if you’re not enrolled.

• Compare in-network vs. out-of-network costs to minimize surprises.

• Get help from a licensed agent listed on this website to ensure you’re in full compliance.

Timeline of Key Medicare-PSHB Integration Events

• January 1, 2025: PSHB officially replaces FEHB for USPS employees and annuitants.

• Ongoing: Medicare-eligible annuitants must maintain Medicare Part B enrollment to preserve full PSHB benefits.

• November-December: Annual Open Season for plan review and changes.

• Each July (if late enrolled): Medicare Part B coverage starts for those enrolling in the General Enrollment Period.

Staying on top of these dates is critical if you’re nearing Medicare age or unsure of your current status.

The Long-Term Cost of Ignoring This Rule

Even one year without Medicare Part B when required can lead to:

• Thousands in extra copay and coinsurance costs,

• Loss of access to secondary payment protections,

• Delays in getting care due to billing disputes,

• Higher premiums from Medicare penalties going forward.

You don’t just lose money—you lose predictability, peace of mind, and access to the benefits you earned.

Preparing for Your Annual Plan Review

Each fall, during the PSHB Open Season, you should:

• Review your plan’s Summary of Benefits carefully.

• Verify your Medicare enrollment status.

• Ask how your plan coordinates with Medicare Part B.

• Ensure any family members also meet the enrollment rules.

If you’re uncertain, don’t guess. Get guidance from a licensed agent listed on this website.

Stay Ahead of the Copay Surprise

The PSHB program is designed to support your healthcare needs, but only if you meet its rules. In 2025, ignoring the Medicare Part B requirement isn’t just a paperwork issue—it directly affects your pocketbook. Higher copays and denied claims are avoidable, but only if you act early and review your enrollment status.

If you’re unsure about your current Medicare enrollment, PSHB eligibility, or how your plan handles coordination, now is the time to ask questions.

Speak with a licensed agent listed on this website to get help tailored to your situation.