Key Takeaways

• Combining Medicare with your PSHB plan can lower your out-of-pocket costs, but only if you enroll at the right time and meet eligibility requirements.

• If you’re required to enroll in Medicare Part B and you skip it, your PSHB coverage could be reduced or even terminated for certain services.

Why Medicare Matters for PSHB Participants at Age 65

Once you turn 65, Medicare becomes a critical piece of your health coverage. If you’re a Postal Service annuitant or a family member enrolled in the Postal Service Health Benefits (PSHB) Program, you need to know that Medicare isn’t optional in the same way it may have felt before. In 2025, the PSHB rules tie certain Medicare decisions directly to your continued access to full benefits.

The PSHB Program is designed to coordinate with Medicare, especially Part A (hospital insurance) and Part B (medical insurance). If you become eligible for Medicare and meet certain conditions, you may be required to enroll in Part B to retain full PSHB benefits.

Let’s walk through what you need to know before combining Medicare with PSHB, what happens if you delay enrollment, and how timing plays a role in getting the most value out of your health coverage.

Who Must Enroll in Medicare Part B Under PSHB Rules

Starting in 2025, certain PSHB enrollees must enroll in Medicare Part B when first eligible. This requirement applies to:

• Postal retirees and family members who are eligible for Medicare Part A at no cost

• Annuitants who retire after January 1, 2025

• Employees who were under age 64 as of January 1, 2025

If you’re in one of these groups and fail to enroll in Part B, your PSHB plan can limit or even deny coverage for services that Medicare Part B would otherwise cover.

You may be exempt from the Medicare Part B requirement if:

• You retired on or before January 1, 2025

• You were already enrolled in Medicare Part A and declined Part B before 2025

• You are covered by certain VA or Indian Health Services programs

• You reside permanently overseas

Timing Your Medicare Enrollment

Your first opportunity to enroll in Medicare is your Initial Enrollment Period (IEP). This window lasts for 7 months:

• Starts 3 months before the month you turn 65

• Includes your birth month

• Ends 3 months after the month you turn 65

Enrolling during the first 3 months ensures your Medicare coverage starts on the first day of your birthday month (unless your birthday is on the 1st of the month, in which case it starts the month before).

If you miss your IEP, you may have to wait for the General Enrollment Period from January 1 to March 31. Your coverage will then begin in July of that year, and you may face late enrollment penalties for Part B.

For PSHB participants, missing your Medicare Part B IEP can lead to more than just penalties. You could lose certain medical benefits from your PSHB plan if you don’t have Medicare Part B in place.

How Medicare and PSHB Plans Coordinate in 2025

Once you’re enrolled in Medicare Parts A and B, your PSHB plan becomes your secondary payer. That means:

• Medicare pays first for eligible services

• Your PSHB plan picks up most of the remaining costs

This coordination can reduce or eliminate:

• Deductibles

• Coinsurance

• Copayments

Some PSHB plans even offer additional benefits to Medicare-enrolled members, such as reduced cost sharing or reimbursement of Part B premiums. However, these enhancements vary by plan, so it’s important to compare plan brochures during Open Season.

Prescription Drug Coverage and Medicare

When you become Medicare-eligible and are enrolled in a PSHB plan, your drug coverage is automatically provided through a Medicare Part D Employer Group Waiver Plan (EGWP). This type of plan is integrated with your PSHB coverage.

Key features in 2025 include:

• $35 monthly cap on insulin

• $2,000 annual out-of-pocket maximum for prescription drugs

• Expanded pharmacy network

This coordination eliminates the need to sign up for a separate Medicare Part D plan. However, if you opt out of the PSHB drug benefit, you’ll lose prescription drug coverage under PSHB and can only re-enroll if you experience a Qualifying Life Event.

What Happens If You Don’t Enroll in Medicare on Time

Failing to enroll in Medicare Part B when required has multiple consequences:

• You may face a lifetime late enrollment penalty: 10% added to your Part B premium for each full 12-month period you delay.

• Your PSHB plan may become secondary to nothing, meaning you’ll pay out of pocket for services that Medicare would have covered.

• Ineligible costs may no longer be reimbursed by your PSHB plan.

PSHB coverage is not designed to stand alone at age 65 and beyond. Medicare is expected to be the primary payer once you’re eligible.

What If You’re Still Working at 65?

If you are still employed by the Postal Service at age 65, you are not required to enroll in Medicare Part B until you retire. Your PSHB coverage remains your primary insurance while actively employed.

Once you retire, you’ll enter an 8-month Special Enrollment Period (SEP) to sign up for Part B without penalty. This SEP begins the month after your employment or employer-sponsored coverage ends.

To avoid gaps in coverage:

• Mark your retirement date

• Apply for Medicare Part B about 2 months before retirement

This way, your Medicare coverage begins the same month your employment-based PSHB status ends.

Coordination for Family Members

If you’re retired and have covered family members who are also Medicare-eligible, each person must enroll in Medicare Part B separately if required. The rules apply individually, not just to the policyholder.

Each family member:

• Has their own enrollment window

• Must maintain eligibility to receive full PSHB benefits

Failing to enroll could result in reduced or terminated coverage for that family member.

How PSHB Premiums Are Affected by Medicare Enrollment

Although PSHB premiums aren’t automatically reduced by enrolling in Medicare, the out-of-pocket savings from coordination can be substantial. Additionally, some PSHB plans offer the following for Medicare enrollees:

• Reimbursement for some or all of the Medicare Part B premium

• Lower copayments and waived deductibles

You must actively compare these features during Open Season, which runs from November to December each year.

Planning for Open Season Choices

During the Open Season window, you can:

• Enroll in a new PSHB plan

• Switch to another plan

• Review plan benefits for Medicare coordination

Here’s what to keep in mind:

• Not all PSHB plans are equally Medicare-friendly

• Compare cost-sharing, premium incentives, and provider access

• Confirm that your Medicare-enrolled family members are also considered in the plan’s benefit design

Use the PSHB Navigator Tool or contact a licensed agent listed on this website to get help understanding plan differences.

Avoiding Disruption in Coverage

To maintain uninterrupted care and cost protection:

• Enroll in Medicare Part B during your IEP or SEP

• Don’t delay beyond your required enrollment date

• Opt into the integrated PSHB drug coverage unless you have other qualified creditable coverage

The PSHB Program assumes that Medicare will pay first once you’re eligible. If you miss enrollment, the plan doesn’t automatically shift to full coverage.

Resources to Support You

Several official sources provide personalized help:

• Social Security Administration: For Medicare enrollment applications and premium details

• OPM: For general PSHB policies

• KeepingPosted.org and LiteBlue: For annuitants and current employees respectively

• PSHB Navigator Help Line (1-833-712-7742): For direct support with questions

You can also speak to a licensed agent listed on this website to help you compare PSHB plans that coordinate well with Medicare and evaluate the right Medicare timing based on your status.

Putting It All Together Before You Enroll

Combining Medicare with PSHB isn’t just about checking a box at age 65. It involves:

• Knowing your deadlines

• Understanding coordination of benefits

• Protecting your out-of-pocket costs

Delaying Medicare enrollment when you’re required to enroll can disrupt your access to care, increase your costs, and create complications that are hard to reverse later. Taking action at the right time ensures that your PSHB plan works as intended with Medicare.

Make time during your 64th year to review your options. Connect with a licensed agent listed on this website to make sure you’re on track and enrolled properly.