Key Takeaways

• Coinsurance under PSHB plans in 2025 can lead to higher out-of-pocket costs than many postal workers and retirees expect, especially if you frequently use specialists or outpatient services.

• Understanding how coinsurance differs from copayments and how your plan shares costs with you is essential for budgeting and managing your healthcare expenses.

Understanding Coinsurance in the PSHB Era

With the launch of the Postal Service Health Benefits (PSHB) Program in 2025, many workers and retirees expected a smooth transition from the Federal Employees Health Benefits (FEHB) system. But if you’ve reviewed your recent medical bills and felt like your share of costs has crept up, coinsurance could be the reason.

Coinsurance is the percentage you pay for covered healthcare services after meeting your plan’s deductible. Unlike a fixed copayment, coinsurance depends on the total cost of services. And that variable can make it feel unexpectedly expensive—especially now that PSHB has become your primary coverage.

How Coinsurance Works in Your Plan

Once you’ve satisfied your annual deductible, coinsurance kicks in. That might mean:

• Paying 20% to 30% of the cost for in-network services

• Covering 40% to 50% or more for out-of-network care

For example, if an outpatient procedure costs $1,000, a 30% coinsurance means you could owe $300 out-of-pocket after the deductible. And if that same service is out-of-network, your portion could be significantly higher.

Coinsurance continues until you hit your plan’s annual out-of-pocket maximum, which caps what you spend on deductibles, coinsurance, and copayments for the year. But that limit can still feel far away when bills start adding up in the early months.

2025 Coinsurance Trends You Need to Know

In 2025, PSHB coinsurance structures vary depending on your plan option, but some trends are emerging:

• Higher Coinsurance Rates: Some plans that offer lower premiums tend to make up for it with higher coinsurance.

• Specialist Visits: Seeing a specialist often incurs coinsurance instead of a flat copay, leading to bigger bills per visit.

• Outpatient Services: Imaging, lab work, and surgeries often fall under coinsurance, especially outside of primary care.

This shift away from predictable copays to percentage-based costs is one of the reasons coinsurance feels more expensive now—even when plan benefits haven’t dramatically changed.

What Makes Coinsurance Feel So Expensive?

Several psychological and financial factors contribute to why coinsurance may feel costlier than expected:

• Uncertainty: Unlike copays, coinsurance doesn’t tell you what you’ll owe until after the service is billed.

• Price Transparency Gaps: It’s hard to budget when you don’t know upfront what a procedure or test will cost.

• Rising Medical Service Costs: As medical rates increase, your share via coinsurance also climbs.

• Increased Utilization: If you’re managing chronic conditions or recovering from surgery, you may face repeated coinsurance charges.

You might have expected stable, flat costs, only to find a fluctuating percentage applied to services you didn’t anticipate needing so often.

Comparing Coinsurance to Copayments

It’s easy to confuse coinsurance with copayments—but the two operate very differently:

• Copayment: A fixed dollar amount (e.g., $40 for a doctor’s visit)

• Coinsurance: A percentage of the allowed cost (e.g., 30% of the total bill)

In practice, copays are easier to budget for and understand. Coinsurance introduces variability, which makes planning and affordability more challenging, especially when you’re living on a fixed retirement income.

Where Coinsurance Hits the Hardest

There are certain services and settings where coinsurance takes a larger bite:

• Specialist Appointments: Some plans apply coinsurance instead of copays for specialists.

• Outpatient Surgeries: These can cost thousands of dollars, leaving you with hundreds in coinsurance charges.

• Lab Tests and Imaging: MRIs, CT scans, and other diagnostics often come with percentage-based cost sharing.

• Rehabilitation Services: Physical therapy, occupational therapy, and cardiac rehab are often billed with coinsurance.

If your plan requires coinsurance for these categories, a single unexpected event can lead to rapid cost accumulation.

Deductibles Set the Stage

Before coinsurance even kicks in, you’re often required to meet an annual deductible. In 2025, deductibles under PSHB plans typically range from $350 to $2,000 depending on whether you’re in a standard or high-deductible option.

If you haven’t yet met your deductible, you pay the full cost of services (negotiated plan rates) out of pocket. Only then does coinsurance begin.

This sequence can be confusing, especially in the first half of the year when you’re seeing bills that feel like they’re stacking without end.

The Role of Out-of-Pocket Maximums

Thankfully, every PSHB plan comes with a built-in out-of-pocket maximum—a ceiling on your costs for in-network services in a calendar year. In 2025, that limit is commonly around $7,500 for Self Only coverage and $15,000 for Self Plus One or Self and Family.

Once you’ve reached that threshold, the plan pays 100% of covered costs for the rest of the year. While that cap offers some financial protection, the journey to reach it can still be steep.

Budgeting for Coinsurance in 2025

If you’re not budgeting with coinsurance in mind, it’s easy to underestimate your real healthcare expenses. Consider these tips:

• Estimate Annual Needs: Look at your prior year’s usage of services like imaging, therapy, or specialist visits.

• Review Plan Summaries: Identify which services are subject to coinsurance versus flat copays.

• Build an Emergency Buffer: Even if you don’t expect to need high-cost care, a sudden diagnosis can change everything.

• Use Flexible Spending Accounts (FSAs): These allow pre-tax contributions to cover coinsurance costs if you’re still employed.

Medicare-Eligible? Coinsurance May Still Apply

Many retirees assume enrolling in Medicare removes coinsurance costs, but that’s not always the case. PSHB plans integrated with Medicare Part B may reduce or eliminate coinsurance for certain services—but not across the board.

For 2025, Medicare coordination with PSHB varies by plan. Some plans waive deductibles and cost-sharing for enrollees with Part B, while others apply partial cost-sharing. Be sure to verify your plan’s specific Medicare integration rules.

PSHB vs FEHB: What’s Changed?

If you retired before 2025, you might be comparing your current PSHB coinsurance with the FEHB plans you knew. Key differences include:

• Plan Restructuring: Some plans modified their cost-sharing approach during the PSHB transition.

• Carrier Adjustments: Though providers are similar, the contract terms under PSHB are not identical to FEHB.

• Emphasis on Medicare Integration: Coinsurance reductions depend more heavily on Part B enrollment now.

So even if the plan name looks familiar, its structure under PSHB might not feel the same.

Don’t Ignore Preventive Care (It’s Usually Free)

Amid all the cost-sharing talk, here’s some good news: preventive services are generally fully covered by your PSHB plan without coinsurance or copayments. These include:

• Annual check-ups

• Screenings for cancer, cholesterol, and blood pressure

• Vaccinations like flu, COVID-19, and shingles

Taking full advantage of preventive care can help you stay healthier and avoid more expensive treatment down the line.

What to Watch For in Annual Plan Reviews

Every year during the November–December Open Season, you have a chance to re-evaluate your PSHB plan. Coinsurance should be a key factor when reviewing plan brochures. Pay special attention to:

• In-network vs. Out-of-network rates

• Specialist and outpatient coinsurance levels

• Annual limits and tiered structures

Don’t just focus on premiums. Look at how the plan treats coinsurance, especially for services you rely on most.

Plan Smarter, Spend Smarter

Whether you’re still working or already retired, coinsurance under PSHB in 2025 is a key part of your healthcare cost landscape. If your plan seems more expensive than expected, dig into where coinsurance applies and how you can minimize its impact.

To get clarity and explore your options, speak with a licensed agent listed on this website. They can help you review how coinsurance fits into the bigger picture—and whether a different PSHB plan might better suit your situation.