Key Takeaways

• While the Postal Service Health Benefits (PSHB) program shares structural similarities with FEHB, it introduces separate rules, eligibility criteria, and integration mechanisms that make it function independently in 2025.

• Relying on old assumptions about FEHB could lead to missed enrollment requirements, costly coordination issues with Medicare, and potential coverage gaps under PSHB.

PSHB Is Its Own System Now

The launch of the Postal Service Health Benefits (PSHB) program in 2025 marks a major shift for all USPS workers and retirees. Although the name feels like a familiar extension of the Federal Employees Health Benefits (FEHB) Program, the PSHB is not simply a copy-paste version. It is a legally distinct system with new regulations, plan structures, and requirements that apply only to the Postal Service population.

PSHB officially replaced FEHB coverage for Postal Service employees, annuitants, and eligible family members as of January 1, 2025. The change was mandated by the Postal Service Reform Act of 2022, and its full implementation has altered how you access healthcare, manage coverage, and interact with Medicare once you retire.

Understanding what sets PSHB apart is critical if you want to avoid enrollment pitfalls and unexpected costs.

Eligibility Is No Longer Just About Your Federal Status

Under FEHB, your status as a federal employee determined your health benefits. But in 2025, your eligibility under PSHB is defined specifically by your connection to the USPS.

You are eligible for PSHB if:

• You are a current USPS employee

• You are a USPS annuitant or survivor annuitant

• You are an eligible family member of a USPS employee or annuitant (spouse or dependent)

Employees and annuitants covered under someone else’s FEHB plan—such as a spouse who is a federal employee but not with USPS—may still keep that FEHB coverage. But you can’t enroll in FEHB as a USPS member going forward. That’s an important distinction.

Enrollment Is Automatic—But Only If You Were Already Covered

If you had FEHB coverage in 2024 as a USPS employee or annuitant, you were automatically enrolled into a corresponding PSHB plan on January 1, 2025. However, the specific plan you were moved into may not be the most appropriate one for your current needs.

Open Season (which takes place each November to December) remains your opportunity to:

• Review the PSHB plan you were placed in

• Switch to another PSHB plan if desired

• Add or remove eligible dependents

New hires must enroll directly into a PSHB plan, not FEHB. If you don’t take action during your initial enrollment window or during Open Season, you may experience delays in coverage or higher out-of-pocket costs.

Integration with Medicare Part B Is No Longer Optional for Many

One of the biggest differences you need to be aware of is Medicare Part B integration. Starting in 2025, many Medicare-eligible Postal Service annuitants and their covered family members must enroll in Medicare Part B to maintain PSHB coverage.

This requirement applies if:

• You are a Medicare-eligible Postal Service annuitant (or family member)

• You retired after January 1, 2025, or

• You were under age 64 as of January 1, 2025

Exemptions may apply if:

• You retired on or before January 1, 2025

• You were 64 or older on January 1, 2025

• You live overseas or have other federal coverage (e.g., VA, IHS)

Failing to enroll in Part B if required can result in a loss of coverage under the PSHB program. This Medicare coordination rule is unique to PSHB and did not exist under FEHB in the same way.

Prescription Drug Coverage Works Differently Now

As of 2025, if you are enrolled in both PSHB and Medicare, you are automatically enrolled in a Part D Employer Group Waiver Plan (EGWP) through your PSHB plan.

This gives you integrated prescription drug coverage under Medicare Part D with:

• An annual out-of-pocket cap of $2,000

• Access to a broad pharmacy network

• Lower costs for high-priced medications

Unlike FEHB plans, where Part D enrollment was optional and separate, PSHB simplifies this by integrating it automatically. You cannot opt into another stand-alone Part D plan without forfeiting your PSHB drug benefits.

Premium Contributions Still Follow the 70/30 Split—but the Plans Are New

The cost-sharing formula between USPS and enrollees has not changed drastically from FEHB. The government still pays approximately 70% of the total premium, and you cover the remaining 30%.

However, PSHB plans are not the same as legacy FEHB plans. They’ve been negotiated exclusively for USPS members. That means:

• Different plan options

• Updated networks and formularies

• Possibly different deductibles, coinsurance, or copayment structures

Although premiums for 2025 remain competitive, the benefits and out-of-pocket costs vary by plan. The plan you had under FEHB might look familiar on paper but behave differently in action under PSHB.

Coordination of Benefits Favors Those Who Pair with Medicare

PSHB plans tend to offer enhanced coordination with Medicare. If you’re enrolled in both PSHB and Medicare Parts A and B, many PSHB plans:

• Waive deductibles

• Reduce or eliminate cost-sharing

• Provide enhanced access to care

This coordination means that your total out-of-pocket expenses could be significantly lower—if you’re enrolled in Medicare Part B as required. For those who aren’t, you may face higher cost-sharing under the PSHB plan alone.

Your Dental and Vision Benefits Are Still Separate

Just like under FEHB, PSHB doesn’t automatically include dental or vision coverage. If you want those benefits, you’ll still need to enroll in the Federal Employees Dental and Vision Insurance Program (FEDVIP).

FEDVIP remains unchanged in 2025. You can still choose from national plans during Open Season. However, remember:

• Former spouses are not eligible for FEDVIP coverage

• FEDVIP premiums are paid entirely by the enrollee

Certain Coverage Changes Require Action Outside of Open Season

The PSHB program recognizes Qualifying Life Events (QLEs), which allow you to make changes to your coverage outside the Open Season window.

These events include:

• Marriage or divorce

• Birth or adoption of a child

• Death of a covered family member

• Change in employment status

You typically have 60 days from the date of the event to update your PSHB enrollment. Missing this deadline could mean waiting until the next Open Season.

Where to Make Changes and Get Help

USPS employees and retirees manage their PSHB enrollment through different platforms:

• Active Employees: Use the LiteBlue portal

• Annuitants: Use the KeepingPosted.org portal or call the PSHB Navigator Help Line

If you’re unsure whether you’ve been automatically enrolled or if your current plan fits your needs, it’s recommended to:

• Review your PSHB plan brochure carefully

• Compare benefits, costs, and Medicare coordination

• Contact a licensed agent listed on this website for personal assistance

It’s Not Just a Name Change—It’s a Whole New Framework

Treating PSHB as merely an extension of FEHB could leave you exposed to new rules you didn’t know applied. From mandatory Medicare integration to automatic drug plan enrollment, from exclusive plan designs to separate eligibility structures—PSHB is a distinct and fully separate system in 2025.

Take time to understand the changes, review your options annually, and reach out for guidance when needed. If you have any uncertainty about your benefits or plan choices, get in touch with a licensed agent listed on this website for personalized support.