Key Takeaways

• Medicare Advantage plans in 2025 come with rules and restrictions that are often not fully understood until you need care, impacting your choice of doctors, treatments, and costs.

• For Postal Service retirees and workers under the PSHB Program, understanding the differences between Original Medicare and Medicare Advantage is essential to making a decision that truly supports your long-term health needs.

The Appeal of Medicare Advantage Plans

Medicare Advantage plans can seem very attractive at first glance. They promise an “all-in-one” package that includes hospital insurance, medical insurance, and often additional benefits like dental and vision care. For Postal Service retirees and workers eligible for PSHB and Medicare, this streamlined coverage option may appear simpler than coordinating separate parts.

• These plans must cover at least what Original Medicare covers.

• Many offer extra perks that traditional Medicare does not.

• Enrollment is generally available during Medicare’s Annual Enrollment Period from October 15 to December 7 each year.

However, the surface simplicity can be deceptive.

Network Restrictions Are a Major Factor

Unlike Original Medicare, Medicare Advantage plans use provider networks. In 2025, most Medicare Advantage plans operate either as HMOs (Health Maintenance Organizations) or PPOs (Preferred Provider Organizations).

• HMO plans usually require you to get care within a specific network and need referrals to see specialists.

• PPO plans offer more flexibility but often at a higher cost if you go outside the network.

If you travel frequently or live part of the year outside your primary residence, these networks can severely limit your access to care.

Prior Authorization: A Hidden Barrier

One of the trickiest hidden rules is prior authorization. Under Medicare Advantage, certain services require approval before you can receive them.

• Common services needing prior approval include MRIs, hospital stays, skilled nursing care, and outpatient surgeries.

• Delays in authorization can impact your treatment timeline.

• If prior approval is denied, you may face out-of-pocket costs or be forced to seek alternative treatments.

This process is not part of Original Medicare, making it a significant point of difference that can affect your care.

Cost Sharing Can Vary Widely

Even though premiums for Medicare Advantage plans can seem lower initially, cost-sharing requirements such as copayments, coinsurance, and deductibles can add up quickly.

• Out-of-pocket maximums for Medicare Advantage plans in 2025 are capped at $9,350 for in-network services and $14,000 for combined in-network and out-of-network services.

• These caps do not include prescription drug costs, even though some plans bundle drug coverage.

When comparing options through PSHB, remember that costs are not limited to just premiums. You must evaluate the full financial picture.

Benefits and Coverage Are Not Standardized

Unlike Original Medicare, Medicare Advantage plans can vary dramatically in what they offer.

• Coverage for dental, vision, and hearing services differs between plans.

• Some plans include gym memberships, transportation to medical appointments, or even meal delivery after hospital stays.

• The details of what is covered and what is not can change annually.

Always review the Annual Notice of Change sent each fall, so you know how your benefits may be adjusted for the following year.

Prescription Drug Coverage Rules Differ

Medicare Advantage plans that include prescription drug coverage (MAPD plans) operate under different formularies and cost structures than standalone Medicare Part D plans.

• Formularies dictate which drugs are covered and at what tier.

• Prior authorization, step therapy, and quantity limits may apply.

• You could face higher costs or denials for medications if your drug needs change during the year.

PSHB participants must ensure their prescription needs match the plan’s coverage to avoid unexpected expenses.

Geographic Limitations Matter More Than You Think

Original Medicare allows you to receive care anywhere in the United States that accepts Medicare. Medicare Advantage plans tie you to specific service areas.

• Emergency and urgent care are covered nationwide, but routine care outside your plan area is not.

• If you move, even temporarily, you might need to change plans during a Special Enrollment Period.

Postal retirees who plan to relocate or travel extensively after retirement should weigh this factor heavily.

Annual Changes Require Vigilance

Medicare Advantage plans can and do change every year.

• Providers may leave or join the network.

• Benefits may be added or dropped.

• Costs such as copays, deductibles, and out-of-pocket maximums often shift.

Every year, from October 15 to December 7, you must review your plan’s changes carefully to determine whether it still meets your needs.

Appeals and Grievances Are an Extra Layer

When you are denied care or coverage under a Medicare Advantage plan, you have the right to file an appeal. However, the appeals process can be time-consuming and complicated.

• Initial appeals often take 30 days or more.

• Expedited appeals are available only under specific circumstances.

• Many enrollees find it stressful to fight for coverage, especially when dealing with serious health issues.

This layer of administration is often unexpected for those accustomed to the straightforwardness of Original Medicare.

Enrollment Windows Are Strict

Medicare Advantage enrollment is regulated through set windows:

• Initial Enrollment Period when you first become eligible.

• Annual Enrollment Period (October 15 to December 7) for switching or dropping plans.

• Medicare Advantage Open Enrollment Period (January 1 to March 31) for changing Medicare Advantage plans or returning to Original Medicare.

Missing these windows can lock you into a plan that no longer suits you for the rest of the year.

Comparing PSHB and Medicare Advantage Needs Special Care

Since 2025 marks the full rollout of PSHB for Postal Service retirees, it is critical to understand how it fits into your Medicare strategy.

• Many PSHB plans coordinate benefits with Medicare Parts A and B, reducing your out-of-pocket costs.

• Some PSHB plans also offer Part D drug coverage integrated with their health benefits.

Carefully evaluate whether Medicare Advantage or PSHB plans with Medicare coordination better meet your needs based on network size, drug coverage, premiums, and cost-sharing structures.

Making the Best Decision for Your Health and Finances

Choosing between Medicare Advantage and other options is about more than just today’s needs. It is about anticipating the future.

• Think about your current doctors and whether they are in-network.

• Consider any anticipated surgeries, therapies, or ongoing treatments.

• Factor in your travel plans or any potential relocations.

Your choice now affects not just what you pay but how easily and quickly you can access the care you need.

What to Watch for Moving Forward

The Medicare landscape will continue evolving in 2026 and beyond. New rules, additional plan offerings, and shifting costs will likely affect your options.

• Pay attention to the Centers for Medicare and Medicaid Services (CMS) announcements each spring.

• Look for any legislative changes that impact Medicare Advantage requirements.

• Always review your plan’s new materials every fall during Open Enrollment.

Staying informed is essential to protecting both your health and your retirement budget.

Smart Coverage Choices Start with Good Information

In 2025, understanding the reality behind the “simplicity” of Medicare Advantage plans is essential. Especially as a Postal Service retiree or worker balancing PSHB options with Medicare, making an informed choice today can prevent unpleasant surprises tomorrow.

If you need personalized help reviewing your Medicare and PSHB options, reach out to a licensed insurance agent listed on this website. They can walk you through your specific circumstances and help you find the most suitable coverage for your needs.