Key Takeaways

• Even though copayments seem like small, manageable expenses, their cumulative effect under the PSHB program—especially when combined with Medicare—can lead to significant out-of-pocket costs over time.

• Understanding how PSHB and Medicare coordinate coverage is essential if you want to avoid duplicate copays or misjudging what your plan actually covers.

What Are Copayments, Really?

At a glance, copayments look simple. They are fixed-dollar amounts you pay when you receive certain healthcare services, like doctor visits, specialist consultations, emergency room trips, or prescription drugs. Under the Postal Service Health Benefits (PSHB) Program, copayments typically apply to services like:

• Primary care office visits

• Specialist visits

• Urgent care and emergency room services

• Mental health and therapy visits

• Tiered prescription drug fills (generic, preferred brand, non-preferred, specialty)

Your plan outlines copayment amounts in its summary of benefits, but what isn’t always clear is how those amounts change once Medicare enters the picture.

When PSHB Meets Medicare

If you’re a Postal Service retiree and you’re eligible for Medicare, you’re most likely enrolled in both PSHB and Medicare Part A and Part B. That means both cover the same types of care, and they work together. Typically:

• Medicare pays first (primary payer)

• PSHB pays second (secondary payer)

The goal is to reduce your out-of-pocket costs. But when it comes to copayments, things don’t always go as planned.

Why Copays Still Show Up After Medicare Pays

You might think, “Medicare is covering this, so why do I still have to pay a copayment?” Here’s why:

• Medicare doesn’t eliminate copayments: Medicare Part B covers 80% of approved charges for outpatient services. The remaining 20% is your responsibility unless your secondary insurance (PSHB) picks it up.

• PSHB may not cover 100% of the remaining 20%: Depending on your specific plan, PSHB might pay only a portion of that 20%, or apply its own copay rules regardless of what Medicare paid.

• Copayments may be built into your PSHB plan structure: Even when Medicare pays its share, your PSHB plan might still apply its own copayment requirement for certain services.

In effect, you can still owe a copay because your PSHB plan considers it a cost-sharing requirement, even if Medicare already handled most of the bill.

Stacked Copays: How It Adds Up Over a Year

Let’s look at how small copayments can add up quickly when you’re managing multiple appointments or prescriptions:

• A $25 primary care visit copay, four times a year = $100

• A $40 specialist visit copay, six times a year = $240

• A $50 urgent care copay, twice a year = $100

• Monthly generic prescriptions with a $10 copay = $120

Even with just routine care, you could be looking at over $500 per year in copayments. And if you manage a chronic condition, the total can double or triple.

Emergency Services and Copays

Emergency room visits tend to have some of the highest copayments under PSHB plans. In-network ER visits often carry a copayment of over $100. While Medicare Part B does pay a portion of emergency services, it doesn’t cover everything. And if your PSHB plan applies its copayment rules after Medicare pays, you’re responsible for the ER copay in full.

Also, keep in mind that if you’re admitted to the hospital, your ER visit is billed differently. It could trigger inpatient coverage rules under Medicare Part A, and your PSHB plan might adjust what you owe accordingly. But you may still owe a copay depending on how your PSHB plan handles that billing event.

Copays for Prescription Drugs Under PSHB and Medicare Part D

For Medicare-eligible annuitants, PSHB drug coverage is integrated with Medicare Part D through an Employer Group Waiver Plan (EGWP). The structure here is layered:

• Medicare Part D applies standard cost-sharing rules (including deductibles and copayments).

• The PSHB plan supplements that coverage, often reducing or capping out-of-pocket costs.

But you still may face:

• Copayments for each 30-day or 90-day supply of medications

• Higher copays for brand-name or specialty drugs

• Separate tiers that assign different copay levels

And remember, these copays apply even if Medicare Part D pays a large share.

Copayments and the Medicare Part B Premium Puzzle

Some PSHB plans offer partial reimbursement of your Medicare Part B premium. While this can help offset your overall healthcare expenses, it doesn’t affect your out-of-pocket responsibility for copayments. This is important: lowering your premium burden does not lower your copays.

If you assume that “having Medicare + PSHB” means zero cost at the point of care, you’re likely to be surprised.

Annual Out-of-Pocket Maximums Help, But Don’t Eliminate Copays

PSHB plans include an annual out-of-pocket maximum, typically around:

• $7,500 for Self Only

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

Copayments do count toward this cap in most cases, which helps protect you from runaway costs. However, until you hit that maximum, you’re still responsible for every copay.

For retirees with frequent healthcare needs or expensive prescriptions, reaching the maximum might offer relief. For others, the cap might remain out of reach, meaning you continue paying copays throughout the year.

When You Use Out-of-Network Services

Out-of-network services under PSHB plans usually come with:

• Higher copayments

• Higher coinsurance rates

• No coordination with Medicare in some cases

Even if Medicare covers a portion of an out-of-network service, your PSHB plan might not offer any protection. You could face full copayments or denied benefits. Always verify network participation before receiving care, especially if you rely on Medicare as your primary payer.

Preventive Services: Sometimes Free, Sometimes Not

Preventive services like screenings, vaccines, and annual wellness visits are generally covered without copayments by Medicare and PSHB when performed by in-network providers. But problems can arise if:

• The provider bills the visit as diagnostic rather than preventive

• You receive additional services during a preventive visit

• The provider is out-of-network

In those cases, your PSHB plan may apply a copayment or coinsurance, despite the Medicare coverage.

Coordination Doesn’t Mean Elimination

The coordination of benefits between Medicare and PSHB is designed to limit your financial exposure. But that doesn’t mean every cost disappears. Here’s why:

• Coordination depends on how the service is coded and billed.

• PSHB plan designs include copayment structures even when Medicare pays primary.

• Providers don’t always bill cleanly or completely.

If Medicare doesn’t cover a service at all, or covers it under a different benefit category, your PSHB plan might apply its standard copay rules, leaving you with a bill.

Reviewing Your Explanation of Benefits (EOB)

Your EOB documents from Medicare and your PSHB plan are critical for understanding how costs are divided. They show:

• What Medicare paid

• What your PSHB plan paid

• What you still owe (copayments, coinsurance, balance bills)

Reading these statements regularly helps catch billing errors and ensures you’re not overpaying due to provider miscoding or miscommunication.

Annual Checkpoints: Reassess Copayment Exposure

Each year, during Open Season (from November to December), you should:

• Review your PSHB plan’s Summary of Benefits

• Compare copayments for common services

• Evaluate how your Medicare benefits integrate with PSHB

If you expect more frequent services in the coming year, even a $5 or $10 difference in copay amounts can influence your total out-of-pocket costs significantly.

Where to Get Help Understanding Copayment Rules

You can get guidance by:

• Contacting your PSHB plan’s customer service

• Speaking to a licensed agent listed on this website

• Reviewing your Annual Notice of Change (ANOC) and Evidence of Coverage (EOC) each fall

Copayment rules are often buried in plan documents, so don’t hesitate to ask for clarity.

Small Numbers, Big Impact

Even though copayments are usually low, they can quietly undermine your retirement budget, especially if you rely heavily on medical care. In 2025, with healthcare utilization rising and inflation impacting service costs, even a few additional appointments or medication refills can shift your financial balance.

The coordination between PSHB and Medicare helps reduce your burden, but it doesn’t erase it. That’s why paying attention to how each copay fits into the bigger picture is essential.

Talk to Someone Who Knows the System

If you’re not sure whether your current PSHB plan and Medicare combination is working efficiently, you don’t have to guess. Reviewing your annual copayments, evaluating plan changes, and aligning your healthcare needs with your benefits are all easier when you have expert help.

To ensure you’re not paying more than necessary, get in touch with a licensed agent listed on this website. They can walk you through plan documents, help you compare copayment structures, and find ways to reduce the financial surprises that catch so many retirees off guard.