Key Takeaways

• Enrolling in both Medicare Part D and a PSHB plan in 2025 can result in overlapping prescription coverage that offers no extra benefit but may increase your costs unnecessarily.

• PSHB plans for Medicare-eligible enrollees already include integrated Part D coverage through an EGWP, so adding a separate Part D plan could lead to coordination issues or even disenrollment from PSHB drug coverage.

Understanding What PSHB Plans Already Include

The Postal Service Health Benefits (PSHB) Program, which replaced FEHB coverage for Postal Service annuitants and their families starting in 2025, is designed with Medicare integration in mind. For annuitants who are Medicare-eligible, most PSHB plans automatically include a Medicare Part D Employer Group Waiver Plan (EGWP) for prescription drugs.

This built-in benefit means:

• You do not need to enroll in a standalone Medicare Part D plan.

• Your prescription costs are already managed through your PSHB plan once you have Medicare Part A and B.

• The EGWP option under PSHB includes access to a large pharmacy network, competitive drug pricing, and protection against high out-of-pocket costs with the new $2,000 annual maximum.

What Happens If You Add a Standalone Medicare Part D Plan?

When you sign up for a separate Medicare Part D plan while already enrolled in a PSHB plan with an integrated EGWP, you risk:

• Being automatically disenrolled from your PSHB drug benefit.

• Losing access to cost-sharing advantages your PSHB plan provides when paired with Medicare.

• Paying extra premiums for Part D with no added value since PSHB already provides comprehensive drug coverage.

You May Not Realize You’re Double Paying

In 2025, all PSHB plans offering drug coverage to Medicare-eligible members include prescription benefits at no extra enrollment step. If you go out of your way to enroll in a separate Part D plan, you could be unknowingly duplicating what you’re already getting.

Consider this:

• Standalone Part D plans charge a monthly premium.

• If you’re already getting drug coverage via PSHB’s integrated EGWP, adding a second plan doesn’t enhance your benefits.

• Drug claims can’t be processed through two different Part D plans—only one payer is allowed.

This means you’re paying for a plan you can’t use effectively.

Coordination of Benefits Gets Complicated

Adding an outside Part D plan doesn’t just create financial waste—it may also disrupt the smooth coordination between your PSHB plan and Medicare.

In 2025, PSHB plans coordinate benefits automatically with Medicare Part A and B when you follow the default structure. But adding another plan into the mix triggers a re-prioritization process that:

• Forces Medicare to consider your outside Part D plan as the primary drug coverage.

• Removes your eligibility from the PSHB-integrated EGWP.

• Results in confusion at the pharmacy counter if your pharmacist tries to process claims under the wrong plan.

This disjointed setup could delay your prescriptions or result in denial of coverage until the conflict is resolved.

You Can’t Combine EGWP and Individual Part D Plans

The Medicare Part D system only allows you to be enrolled in one plan at a time. In 2025, that policy remains in place. If your PSHB plan provides an EGWP and you later sign up for a standalone Part D plan, Medicare will automatically disenroll you from the EGWP.

That means:

• You lose PSHB prescription benefits even if you want to keep them.

• You may pay more for drugs depending on the formulary, pharmacy network, or cost-sharing of your standalone plan.

• Your total healthcare coordination—designed to be seamless between PSHB and Medicare—is fractured.

What You Give Up By Leaving the EGWP

Many PSHB plans offer features within their EGWP drug coverage that standalone plans do not. These include:

• Lower deductibles or none at all when paired with Medicare.

• Coverage for an extended pharmacy network tailored to Postal retirees.

• Benefits such as insulin cost caps and a hard limit on total out-of-pocket drug spending ($2,000 in 2025).

Leaving the EGWP forfeits these advantages—often without any better options in return.

Enrollment Periods Can Lock You In

If you mistakenly drop your PSHB-integrated Part D plan by enrolling in a standalone option, you may not be able to rejoin until the next open enrollment period, which runs from October to December each year.

This means:

• You could be stuck with less favorable drug coverage for the rest of the year.

• If your new plan doesn’t meet your needs, you have limited recourse until the following calendar year.

• Your PSHB medical coverage may still be intact, but the drug portion may be permanently changed until you re-enroll.

Medicare Enrollment Rules Still Apply

Some Postal annuitants may wonder if they can avoid enrolling in Medicare Part B but still add a standalone Part D plan. While technically allowed, this strategy does not align with PSHB’s 2025 integration rules.

Here’s why:

• PSHB plans require Medicare Part B for coordination and premium savings.

• Without Part B, your PSHB plan won’t treat you as a Medicare-integrated enrollee.

• Adding only Part D in this scenario can result in reduced coverage and misaligned benefits.

The Safer Option: Stick With Your PSHB Plan’s Drug Coverage

As of 2025, the PSHB program is specifically structured to work with Medicare in the most cost-efficient, benefit-rich manner possible.

Staying enrolled in your PSHB plan’s default EGWP drug coverage means:

• You don’t pay duplicate premiums.

• You maintain eligibility for lower cost-sharing.

• Your prescription needs are met without coordination conflicts.

This path is streamlined and secure.

What If You Opt Out of PSHB Drug Coverage?

It is possible to decline the integrated drug coverage from your PSHB plan, but doing so comes with significant caveats:

• You must formally opt out, usually at the time of enrollment.

• You cannot easily get it back until the next PSHB Open Season.

• You will be responsible for sourcing drug coverage on your own—which may be more expensive or less comprehensive.

If you do this and later change your mind, your only path back into PSHB-integrated drug coverage is during the annual Open Season unless you qualify for a Special Enrollment Period.

Understanding How Part D Works in 2025

The 2025 changes to Medicare Part D offer better financial protection but don’t eliminate redundancy when combined with PSHB. Here’s what’s important:

• The maximum annual out-of-pocket limit for prescription drugs is now $2,000 under all Part D plans.

• You can spread out drug costs over the year with the new Medicare Prescription Payment Plan.

• All of this is already included in PSHB EGWP plans.

So, again, there’s no added benefit in enrolling in a standalone Part D plan—you’re just duplicating what you already have.

Avoiding Common Enrollment Mistakes

To prevent financial missteps or coverage issues:

• Review your PSHB plan brochure carefully to understand what’s included.

• Do not enroll in a standalone Part D plan unless you have opted out of PSHB’s EGWP.

• Use the Medicare Plan Finder only if you’re sure you’re seeking coverage outside PSHB.

Getting a second opinion from a professional is always a good idea before making changes to your drug coverage.

Stick to One Plan for Simplicity and Savings

Combining PSHB and Medicare is supposed to make your retirement healthcare simpler—not more complicated. But adding a second, unnecessary Part D plan can:

• Erode the cost savings built into your PSHB plan.

• Trigger unwanted disenrollments.

• Lead to confusion and hassle at the pharmacy.

PSHB plans in 2025 are built to include everything you need. Adding more doesn’t mean better.

Make the Right Choice With Expert Guidance

If you’re unsure about your Medicare coordination or whether your current PSHB plan is giving you full value, now is the time to reach out. A licensed agent listed on this website can walk you through your options and help you avoid expensive mistakes.