Key Takeaways

• Even with Postal Service Health Benefits (PSHB), coinsurance can significantly increase your out-of-pocket costs depending on how and where you receive care.

• Understanding the difference between copayments and coinsurance—and knowing your plan’s cost-sharing details—is essential for avoiding billing surprises in 2025.

Why Coinsurance Deserves Your Full Attention

You might assume that once you enroll in a PSHB plan, you’re protected from high healthcare bills. And while it’s true that PSHB offers valuable coverage for active and retired USPS employees and their families, it doesn’t cover everything at a fixed price. One often-overlooked element—coinsurance—can drastically shift your financial expectations, especially if you face unexpected or complex medical situations.

Coinsurance is not the same as a simple copayment. Unlike a fixed fee you pay upfront, coinsurance represents a percentage of the total cost of services. And that percentage can add up quickly, especially for hospital stays, specialist procedures, or out-of-network care.

Coinsurance vs. Copayments: A Crucial Distinction

In 2025, many PSHB enrollees still confuse these two terms. Here’s how they differ:

• Copayment: A set dollar amount you pay for services like doctor visits, urgent care, or prescriptions. It’s predictable.

• Coinsurance: A percentage of the cost of a covered service you must pay after meeting your annual deductible. It fluctuates based on the total service cost.

So, if your coinsurance is 20% and your provider charges $1,000, you’re responsible for $200—after your deductible is met.

Coinsurance Starts After the Deductible

Your deductible is the amount you must pay each year before your plan begins covering services with coinsurance. For 2025, deductibles under PSHB plans vary based on whether you choose a standard or high-deductible option:

• Low-deductible plans usually have a range of $350-$600 for Self Only coverage.

• High-deductible plans can start at $1,500 and go beyond $2,000.

Once you meet your deductible, coinsurance kicks in for many services, such as:

• Imaging (CT scans, MRIs)

• Inpatient hospital care

• Surgery

• Out-of-network services (if covered)

How Coinsurance Affects Out-of-Pocket Costs

Coinsurance often surprises enrollees because it applies to more expensive services. You might think you’re only responsible for a few hundred dollars, but that quickly multiplies if you have multiple services or ongoing treatments.

In 2025, PSHB plans cap your out-of-pocket maximum, typically around:

• $7,500 for Self Only in-network

• $15,000 for Self Plus One or Self and Family in-network

Once you hit these limits, your plan pays 100% of covered services for the rest of the year. But reaching these caps can be financially painful if you’re not expecting coinsurance charges to escalate your costs.

In-Network vs. Out-of-Network Coinsurance

Another way coinsurance affects your budget is whether you stay in-network.

• In-network providers have negotiated lower rates with your plan, so your percentage is based on a lower total cost.

• Out-of-network providers can charge much more—and PSHB plans usually cover a smaller percentage or nothing at all beyond the plan’s allowed amount.

So, if your in-network coinsurance is 20% but out-of-network coinsurance is 40% (or more), a $3,000 procedure could result in a $1,200 bill instead of $600.

Prescription Medications and Coinsurance

Not all drug costs are fixed. Some specialty medications—especially those for chronic conditions—may have coinsurance instead of a flat copayment.

• Generic drugs usually come with copayments.

• Brand-name or specialty drugs may carry 20%-30% coinsurance.

Even with the 2025 Medicare Part D integration for eligible retirees, high-cost prescriptions can result in steep monthly costs until you hit the $2,000 out-of-pocket cap on drug spending.

The 2025 Cost-Sharing Landscape Under PSHB

The current PSHB structure offers different tiers of coinsurance depending on the service category:

• 10%-30% for in-network services

• 40%-50% for out-of-network services

What’s covered under coinsurance varies by plan, but common areas include:

• Hospital admissions

• Emergency services

• Durable medical equipment

• Mental health services

• Physical therapy

Why Coinsurance Matters Even With Medicare

If you’re a Medicare-eligible annuitant enrolled in both Medicare Part B and PSHB, your coinsurance responsibilities are often reduced. But this coordination isn’t automatic. You must:

• Be enrolled in both Medicare Part A and Part B

• Select a PSHB plan that coordinates well with Medicare

Some PSHB plans waive or reduce coinsurance when Medicare is primary. However, if you skip Part B, your PSHB coinsurance applies in full.

Preventive Services May Still Incur Charges

Preventive care is typically fully covered under PSHB when performed in-network. But if your preventive service turns into a diagnostic one—like if a screening uncovers an issue requiring immediate attention—you may be billed coinsurance for additional tests or procedures.

Always clarify in advance:

• Whether the service is truly preventive

• Whether your provider is in-network

Strategies to Prepare for Coinsurance Costs

Here’s how to stay ahead of surprise charges in 2025:

• Request cost estimates from providers before scheduling expensive procedures.

• Use your plan’s member portal to confirm in-network status.

• Track your deductible and out-of-pocket max to anticipate when coinsurance begins and ends.

• Compare treatment options, as some lower-cost options carry lower coinsurance.

• Coordinate with Medicare, if eligible, to reduce cost-sharing.

Coinsurance and High-Deductible Health Plans (HDHPs)

If you’re enrolled in a high-deductible PSHB plan, coinsurance is often higher and kicks in later. However, these plans come with a Health Savings Account (HSA) that can be used tax-free for eligible costs—including coinsurance.

For 2025, the HSA contribution limits are:

• $4,300 for Self Only

• $8,550 for Self and Family

• Additional $1,000 catch-up if age 55 or older

Using HSA funds smartly can buffer your exposure to coinsurance, especially for planned procedures.

When Coinsurance Is Worth Watching Closely

There are certain scenarios in 2025 when you should give coinsurance your full attention:

• Upcoming surgeries or complex imaging procedures

• Frequent specialist visits

• Hospitalizations or ER visits

• Long-term therapies like chemotherapy, physical rehab, or behavioral health

• Unexpected out-of-network care

In these cases, what you owe in coinsurance can quickly climb into the thousands.

How to Review Your Plan’s Coinsurance Terms

During Open Season (November to December), you’ll have the opportunity to review and change your PSHB plan. Pay close attention to the Summary of Benefits:

• Look for coinsurance percentages by category

• Compare in-network vs. out-of-network charges

• Check if Medicare coordination reduces or eliminates coinsurance

It’s also wise to review your plan brochure or call the plan’s customer service line to clarify any ambiguities.

Final Thoughts on Understanding Your Share

Coinsurance isn’t something you can afford to ignore. It’s not just a number buried in your benefits brochure—it’s the percentage of healthcare costs you’re expected to carry. And when those costs are high, that percentage matters.

As a PSHB enrollee in 2025, it’s your responsibility to:

• Understand when coinsurance applies

• Know your deductible and out-of-pocket limits

• Stay in-network whenever possible

• Use available tools, including HSA funds and Medicare coordination

If you’re unsure about your coinsurance exposure or how to lower it, speak with a licensed agent listed on this website for guidance tailored to your situation.