Key Takeaways

• Enrolling in Medicare Part C (Medicare Advantage) can significantly alter how your Postal Service Health Benefits (PSHB) plan works, including how claims are paid and what coverage is primary.

• Some PSHB benefits may become redundant, overlap, or be impacted by coordination of benefits rules once Medicare Part C becomes your primary plan.

Understanding the Basics of Medicare Part C

Medicare Part C, or Medicare Advantage, is an alternative to Original Medicare. These plans are administered by private insurance companies approved by Medicare and must cover at least the same services as Medicare Part A and Part B. Many also offer extra benefits like vision, hearing, dental, or prescription drug coverage.

From a coverage standpoint, choosing Medicare Part C means that your Medicare benefits are now managed entirely through a private plan rather than through Original Medicare. This change has a ripple effect on how your PSHB plan coordinates with your Medicare coverage.

PSHB and Medicare: How They Usually Work Together

Under typical circumstances, when you enroll in both Original Medicare (Parts A and B) and a PSHB plan, Medicare acts as the primary payer, and your PSHB plan becomes secondary. This coordination reduces your out-of-pocket expenses and often allows you to benefit from waived deductibles and lower copayments.

PSHB plans are designed with this coordination in mind. In fact, for many postal retirees, enrolling in Medicare Part B is a requirement to maintain PSHB coverage in retirement. This ensures that the plan pays secondary and reduces claim costs across the board.

However, once you switch to Medicare Part C, this structure changes entirely.

What Changes When You Enroll in Medicare Part C

When you enroll in a Medicare Advantage plan, that plan becomes your primary insurance for all Medicare-covered services. Here’s what that means for your PSHB coverage:

1. PSHB Becomes Secondary, But With Limitations

Your Medicare Advantage plan pays first, but your PSHB plan may no longer serve as a traditional secondary plan. Some PSHB plans are not set up to coordinate benefits with Medicare Advantage the way they do with Original Medicare. This could lead to:

• Limited or no cost-sharing reimbursements from PSHB.

• Denied claims where coordination is not recognized.

• Redundancy in coverage and premium payments.

2. Prescription Drug Coverage May Overlap or Conflict

Most Medicare Advantage plans include prescription drug coverage (known as MAPD). Your PSHB plan already includes its own prescription coverage. This can result in:

• Dual premiums for overlapping drug benefits.

• Potential conflicts or confusion at the pharmacy counter.

• Requirement to use one drug plan over the other depending on coordination rules.

In many cases, your PSHB plan’s Part D coverage is through a Medicare Employer Group Waiver Plan (EGWP). If you remain enrolled in both, the PSHB plan might be automatically overridden or cancelled, depending on how the two plans interact.

3. PSHB Premiums Continue, Even If Benefits Aren’t Used

Even if you enroll in a Medicare Advantage plan and rely on it exclusively for care, your PSHB premiums will still be charged unless you formally cancel or suspend your enrollment. This means you could be paying hundreds of dollars per month for a plan you are not actively using.

Suspending PSHB during Medicare Advantage enrollment is only available under specific rules, and not all PSHB enrollees are eligible for suspension. Timing and process matter here.

4. Different Provider Networks and Billing Rules

Your PSHB plan and Medicare Advantage plan may not share provider networks. Medicare Advantage plans typically operate within a specific network (such as HMO or PPO). If you switch to Medicare Part C:

• Your provider options may narrow.

• You might have to change doctors.

• You may be required to follow prior authorization and referral rules unfamiliar to PSHB users.

PSHB, when secondary to Original Medicare, allows more flexibility in provider choice because of Medicare’s broad acceptance.

PSHB Requirements for Medicare Part B Enrollment

As of 2025, most Medicare-eligible annuitants must be enrolled in Medicare Part B to maintain their PSHB coverage. This rule applies unless you meet an exception, such as:

• You retired on or before January 1, 2025.

• You were age 64 or older on January 1, 2025.

• You reside outside the U.S. and its territories.

• You receive health benefits from the VA or Indian Health Service.

These requirements are enforced to ensure proper coordination between Medicare and PSHB. Enrolling in Medicare Part C does not exempt you from the Part B requirement under PSHB rules.

Timing and Enrollment Considerations

Medicare Advantage plans generally allow enrollment during:

• Your Initial Enrollment Period (IEP): 7-month window around your 65th birthday.

• Annual Enrollment Period (AEP): October 15 to December 7 each year.

• Medicare Advantage Open Enrollment: January 1 to March 31 each year.

• Special Enrollment Periods (SEPs): Triggered by qualifying life events.

Changing to Medicare Part C outside these windows may not be possible unless you qualify for an SEP.

If you change to Medicare Advantage during AEP, the new plan takes effect January 1. However, changes in PSHB coordination due to your Medicare Advantage enrollment may not be reversible immediately if you experience dissatisfaction or coverage gaps.

Should You Suspend PSHB If You Choose Medicare Advantage?

Some retirees explore the option of suspending PSHB coverage to avoid dual premiums. The suspension process:

• Is only available if you enroll in a Medicare Advantage plan, Medicaid, TRICARE, or CHAMPVA.

• Requires a formal suspension request through OPM.

• Can only be reversed during Open Season or after a qualifying life event.

Suspension means you temporarily stop paying for and receiving PSHB benefits, but you retain the right to re-enroll later. However, any re-enrollment is subject to future PSHB rules and plan availability.

It’s important to note that suspension differs from cancellation. Cancellation is permanent, while suspension preserves your eligibility.

Financial Impact of Having Both PSHB and Medicare Part C

While it may seem like having both gives you double coverage, this often results in:

• Paying for benefits that don’t coordinate properly.

• Paying two sets of premiums with minimal return.

• Increased administrative confusion when seeking care.

In many cases, the Medicare Advantage plan may cover most services, and the PSHB plan might offer minimal financial contribution in return. On the other hand, if you cancel or suspend your PSHB and your Medicare Advantage plan changes significantly in future years, your options could be limited.

Planning Tips Before You Choose Part C Over Original Medicare

Before making the switch, review:

• Your current provider network. Will you lose access to certain doctors or facilities?

• Out-of-pocket maximums. Medicare Advantage plans have annual caps; compare them with PSHB’s.

• Prescription drug formularies. Are your medications covered under the new plan?

• Reimbursement rules. Will your PSHB plan coordinate with Part C if you keep both?

• Suspension eligibility. Are you allowed to suspend PSHB under current rules?

Consulting a licensed agent listed on this website can help you evaluate the pros and cons of changing coverage paths and clarify your eligibility.

Be Cautious with Automatic Enrollment and Annual Changes

Every year, Medicare Advantage plans can change their benefits, premiums, provider networks, and drug coverage. These changes are announced via the Annual Notice of Change (ANOC) each September.

If you aren’t paying attention, you may find that the coverage you relied on in 2025 isn’t the same in 2026. Since PSHB plans don’t automatically adjust to reflect these changes, it becomes your responsibility to reassess whether the dual coverage still makes financial and clinical sense.

Moreover, PSHB Open Season also occurs from November to December. This is your only opportunity each year to switch, suspend, or adjust your PSHB plan unless you qualify for a Special Enrollment Period.

The Balance Between Convenience and Coverage

It’s understandable to be attracted to Medicare Advantage for the consolidated benefits, especially if you’re healthy and use few services. But the PSHB program was structured assuming coordination with Original Medicare, not Part C.

When you enroll in a Medicare Advantage plan:

• You reduce how much PSHB can do for you.

• You might not get reimbursed for certain services.

• You risk paying more than necessary if both plans overlap.

However, if you meet eligibility to suspend PSHB and you’re confident in the Medicare Advantage network and rules, then making the switch may suit your goals.

Know What You’re Giving Up Before You Opt In

Before enrolling in Medicare Part C, make sure you understand the downstream effects on:

• PSHB cost-sharing.

• Prescription coverage coordination.

• Access to out-of-network care.

• Long-term re-enrollment rights.

• Eligibility to suspend or return to PSHB.

A licensed agent can help you interpret how your choice will play out based on your retirement timeline, age, and health priorities.

Make Smart Coverage Decisions With Expert Help

Your health coverage decisions in retirement affect both your finances and your care. Medicare Advantage plans come with appeal but also complexity. If you’re considering Medicare Part C, be sure to compare it against how PSHB plans are designed to work with Original Medicare.

Get in touch with a licensed agent listed on this website to ensure your decisions are fully informed, cost-effective, and aligned with your future goals.