Key Takeaways

• Even with generous government contributions, your share of PSHB premiums in 2025 can be significantly higher than you expect—especially if you’re on a family or Self Plus One plan.

• Understanding the difference between total plan cost and what you actually pay out-of-pocket each month is essential to budget smartly and avoid surprises.

What You’re Really Paying Into the PSHB Program

If you’re enrolled in the Postal Service Health Benefits (PSHB) Program in 2025, it might seem like the government is covering most of the cost. And it’s true: the government continues to pay about 70% of the total plan premium. But here’s what often gets missed—you’re still responsible for the remaining 30%, and when you break that down over time, especially in higher coverage tiers, your personal contributions are far from minimal.

This is especially important if you’re comparing PSHB with your previous FEHB experience. While the framework is similar, the specific contribution amounts for 2025 under PSHB reflect both broader healthcare inflation and structural changes in how postal plans are funded.

How Monthly Premium Contributions Are Calculated

The PSHB premium you pay is calculated based on your plan’s total cost and the government’s contribution. Here’s how it typically works:

• The government pays around 70% of the weighted average of premiums across all plans.

• You pay the rest—which can range from a few hundred to over a thousand dollars per month, depending on your plan tier.

Let’s look at the basic tiers:

• Self Only: Best for individuals with no dependents.

• Self Plus One: Covers you and one eligible family member.

• Self and Family: Covers you and all eligible family members.

Your costs rise substantially from Self Only to Self Plus One and then to Self and Family. That means if you’re on a family plan, your contribution could be over double what someone with Self Only coverage pays—even though the government still pays roughly the same percentage.

Why Self Plus One Might Feel More Expensive Than Expected

The Self Plus One tier was originally designed to give couples or single parents with one child a more affordable option than the full family tier. However, in 2025, many PSHB participants find that Self Plus One doesn’t offer significant savings over Self and Family plans.

This is because the government’s contribution formula doesn’t change based on which tier you choose. It’s tied to the overall average premium, not the number of people you’re covering. So your share could still be high, especially if your plan has a high base premium.

Cost Over Time: Annual Contributions Add Up

It’s easy to think in terms of monthly payments, but when you multiply your biweekly premium by 26 pay periods, the full-year contribution might surprise you.

For example:

• If you’re paying around $240 per month for Self Plus One, that adds up to more than $3,100 a year.

• On a Self and Family plan with a $567 monthly share, you’re paying over $6,800 annually.

These amounts come directly out of your pension or paycheck—and they don’t even include your out-of-pocket costs like copayments, deductibles, or coinsurance.

Retirement Status Makes a Difference

Whether you’re an active postal worker or an annuitant affects how much you pay. Retirees under PSHB in 2025 generally pay more out-of-pocket because their contributions are calculated post-tax, unlike active employees whose premiums are deducted pre-tax.

This subtle difference can have a big impact. Not only are you paying the same or higher premiums as when you were employed, but you’re also losing the tax advantage. This effectively increases the real cost of your coverage.

medicare Coordination and Premium Impact

If you’re retired and enrolled in Medicare Part B, some PSHB plans offer incentives such as partial premium reimbursement or lower cost-sharing. However, not all plans provide this benefit, and the requirement to enroll in Part B for continued PSHB eligibility can result in double premiums—one for Medicare and one for PSHB.

This dual-premium setup may lead to confusion about where your money is going. Many retirees don’t realize how much they’re truly spending until they add up both monthly amounts.

The Risk of Assuming Government Coverage Is Enough

Because the government pays a large portion of your total premium, it’s easy to assume your coverage is highly subsidized. And while that’s true to an extent, it doesn’t mean your contribution is small.

For higher-income families or those on plans with robust benefits, your contribution could be as much as 30% of the plan cost—without you ever seeing the actual total premium amount. That’s why understanding your premium share is key to budgeting realistically.

Budgeting Beyond the Premium: Hidden Costs That Add Up

Premiums are only part of the financial picture. As a PSHB enrollee, you also face:

• Copayments for doctor visits, urgent care, specialists, and ER visits

• Coinsurance, particularly for outpatient services, lab work, or surgeries

• Deductibles that must be met before coverage fully kicks in

These out-of-pocket expenses can be unpredictable, especially during a health crisis. When combined with monthly premiums, your actual cost of healthcare in 2025 can be significantly higher than what your paycheck or pension deduction suggests.

Tracking Your Costs Year-Round Is Essential

In the past, many postal employees reviewed their health plans only during Open Season. But with the increased complexity of PSHB in 2025, keeping an eye on your healthcare spending throughout the year can help you:

• Spot patterns in high-cost services

• Evaluate whether your current plan is still a good fit

• Decide if switching plans in the next Open Season might save you money

You can also use online tools or contact a licensed insurance agent listed on this website to understand how your plan’s costs stack up against other options.

Understanding PSHB Contribution Trends for the Future

In 2025, the shift from FEHB to PSHB marks a new chapter in postal employee benefits. While the foundational structure remains similar, PSHB plans are tailored specifically to postal needs—and with that comes new pricing structures, updated contribution formulas, and evolving cost-sharing features.

You should expect annual premium increases to continue, driven by national healthcare inflation and plan-specific adjustments. This means even if you stay in the same plan year after year, your contribution is likely to rise gradually.

The key takeaway here is not to be passive. Understanding what you’re paying and why helps you anticipate changes before they hit your bank account.

Why Knowing Your Contribution Share Matters Now More Than Ever

As a postal worker or retiree in 2025, your health benefits are one of your most valuable assets—but they also represent a major financial commitment.

Whether you’re paying $240 a month or over $500, your PSHB contributions deserve your attention. Don’t assume they’re static or insignificant. Track them. Question them. Understand them.

If you’re unsure how your plan compares to others or want help evaluating your options during Open Season, get in touch with a licensed insurance agent listed on this website. They can help you assess the best path forward based on your household’s needs and budget.