Key Takeaways

• In 2025, all Postal Service employees and annuitants are officially transitioned from the FEHB system to the new PSHB program. This change affects how your health plan works, from Medicare coordination to premium structures.

• Although PSHB aims to mirror FEHB in many ways, several structural differences will affect your coverage, options, and costs—especially if you’re retired or nearing Medicare eligibility.

Why the FEHB Era Has Officially Closed for Postal Employees

Starting January 1, 2025, your access to the Federal Employees Health Benefits (FEHB) Program as a Postal Service employee or annuitant comes to an end. You are now part of the Postal Service Health Benefits (PSHB) Program, a new system created by the 2022 Postal Service Reform Act.

The intention behind the PSHB was to lower long-term healthcare costs for the Postal Service while aligning retiree health benefits more closely with Medicare. But while the transition is administrative on the surface, what you experience as a member is noticeably different.

What the PSHB Program Replaces

The PSHB Program replaces all FEHB coverage for USPS employees and annuitants. However, if you’re covered as a family member under a non-Postal FEHB enrollee (such as a federal civilian spouse), you may remain under FEHB. For everyone else in the USPS system:

• You are automatically moved to a PSHB plan comparable to your 2024 FEHB coverage unless you make a change during Open Season.

• You must use the new PSHB enrollment portals: LiteBlue for employees and KeepingPosted.org for annuitants.

How PSHB Differs in Medicare Integration

This is one of the most noticeable changes for retirees and those turning 65 soon. Under FEHB, Medicare enrollment was optional. Under PSHB, it’s a condition of continued coverage for many.

Mandatory Medicare Part B Enrollment

If you are a Medicare-eligible annuitant or family member and:

• You retired after January 1, 2025, or

• You are an active employee age 64 or older as of January 1, 2025,

You must enroll in Medicare Part B to maintain your PSHB plan.

Who Is Exempt

You are exempt from this requirement if:

• You retired on or before January 1, 2025 and are not currently enrolled in Medicare Part B.

• You live overseas or get care through Indian Health Services or the VA.

This requirement creates a significant shift in how your benefits coordinate. With Medicare Part B as primary and your PSHB plan as secondary, your overall out-of-pocket costs may drop. But you will now need to pay monthly Medicare premiums.

Prescription Coverage Now Works Differently

All Medicare-eligible annuitants and their family members automatically receive Medicare Part D drug coverage through an Employer Group Waiver Plan (EGWP) as part of their PSHB enrollment.

• No separate signup required

• Includes a $2,000 annual out-of-pocket cap on prescription drugs

• $35 cap on insulin and broader network access

If you choose to opt out of this EGWP drug coverage, you lose all pharmacy benefits under your PSHB plan. Re-enrollment is limited, so this decision is critical.

Cost-Sharing Structures Are Shifting

Although many PSHB plans are modeled after their FEHB counterparts, the cost structures aren’t identical. This affects deductibles, copayments, coinsurance, and premium shares.

Deductibles

• In-network deductibles now typically range from $350 to $500 under low-deductible plans

• High-deductible plans can reach up to $2,000 in-network

• Out-of-network deductibles go much higher, between $1,000 and $3,000

Copayments

Expect more structured copayments:

• Primary care visits: $20–$40

• Specialist visits: $30–$60

• Urgent care: $50–$75

• Emergency room: $100–$150

Coinsurance

If your service falls under coinsurance rather than a copay:

• In-network coinsurance: 10% to 30%

• Out-of-network coinsurance: 40% to 50%

Premium Contributions in 2025

Your share of PSHB premiums depends on whether you’re an employee or an annuitant. These numbers reflect average shares across plan tiers:

• Employee Biweekly Share:

  • Self Only: ~$397

  • Self Plus One: ~$859

  • Self and Family: ~$935

• Annuitant Biweekly Share:

  • Self Only: ~$111

  • Self Plus One: ~$240

  • Self and Family: ~$262

The federal government continues to cover approximately 72% of the total premium. But the premium structure in PSHB now better reflects usage patterns, especially for retirees.

Provider Networks and Plan Offerings

Although the overall number of plans offered under PSHB is smaller than the FEHB system, most popular carriers and network types are still represented. However:

• Some regional options under FEHB are no longer available

• PSHB plans focus more on Medicare coordination than FEHB ever did

You may need to confirm whether your preferred doctors and hospitals are still in-network under your new PSHB plan.

What Stays the Same

Despite the many differences, PSHB keeps several familiar benefits from FEHB:

• Access to national and regional provider networks

• Annual Open Season each fall for plan changes

• Eligibility for family coverage and dependent children under age 26

• Access to Flexible Spending Accounts (for employees)

• FEDVIP (Dental and Vision) remains separate but available

What to Do If You’re Retiring Soon

If you’re planning to retire in 2025 or later, this shift is especially important for you.

• You will need to enroll in Medicare Part B to keep your PSHB coverage.

• Make sure you understand how your Part B premiums will interact with your annuity.

• Review your Medicare Effective Date to ensure your PSHB plan adjusts accordingly.

If you’re already retired and eligible for Medicare but haven’t enrolled in Part B, your exemption applies only if you retired on or before January 1, 2025.

What to Expect During Open Season in 2025

This November to December, you’ll have the opportunity to:

• Review your default PSHB plan

• Switch to a different PSHB option

• Add or drop eligible dependents

• Confirm your Medicare status and its coordination with PSHB

Missing Open Season means automatic reenrollment in your current (or mapped) PSHB plan, which may not be the best fit for your current needs.

Support Resources You Should Use

To avoid confusion and ensure you are getting the most out of your PSHB coverage:

• Use KeepingPosted.org to access plan documents, FAQs, and contact tools

• Call the PSHB Navigator Help Line at 1-833-712-7742

• Read your Annual Notice of Change (ANOC) to understand shifts in benefits

If you need personalized advice, licensed agents listed on this website can help you compare options, understand Medicare interactions, and answer plan-specific questions.

Why It Matters to Take This Seriously

The shift from FEHB to PSHB may seem like a paper-based change, but the downstream impact is real:

• Your cost structure is different

• Your Medicare obligations are stricter

• Your prescription benefits are automatically linked to your PSHB

Not reviewing your coverage during Open Season or ignoring Medicare requirements could leave you exposed to higher costs or even loss of coverage.

The New Rules of Coverage Deserve Your Attention

You are no longer in the FEHB system. You are now part of a new structure with its own rules, premiums, and expectations. Taking the time now to understand how PSHB works, especially in coordination with Medicare, will save you thousands of dollars and hours of frustration later.

For guidance specific to your situation, get in touch with a licensed agent listed on this website who can walk you through your PSHB options and help you make confident decisions about your 2025 coverage.