Key Takeaways

• Even with PSHB coverage, deductibles in 2025 are transferring more financial responsibility to you upfront—especially for care you assume is already covered.

• Understanding the hidden costs behind your plan’s deductible helps you avoid overspending and plan better for both routine and emergency care.

What It Means to Be “Covered” Isn’t What It Used to Be

You probably think that once you’re enrolled in a Postal Service Health Benefits (PSHB) plan, you’re automatically protected from high out-of-pocket costs. But that assumption overlooks one major financial lever built into every plan: the deductible.

In 2025, deductibles remain one of the most misunderstood components of PSHB plans. These are the upfront costs you are required to pay before your health plan even begins to contribute. And they aren’t just numbers buried in a brochure—they directly affect how much financial risk you carry.

The idea that you’re covered but still responsible for hundreds—or even thousands—of dollars before your plan helps is a gap in understanding that too often leaves Postal Service workers and retirees surprised by their true annual costs.

What You Pay Before Coverage Kicks In

Under PSHB, your deductible acts as a gateway. Until you pay that amount out-of-pocket, your plan pays nothing for many covered services. Here’s what that means for you:

• In-network deductibles for Self Only coverage typically range from $350 to $500 for low-deductible plans, and from $1,500 to $2,000 for high-deductible options.

• Self Plus One and Self & Family coverage often comes with deductibles double those of individual coverage.

• Out-of-network deductibles are even steeper, ranging from $1,000 to over $3,000, depending on the plan.

These amounts reset every calendar year, so even if you met your deductible late in 2024, your counter restarted on January 1, 2025.

You’re Covered—But Only After You Spend This Much

There’s a common misconception that insurance pays for your care immediately. That’s only true for services that are not subject to the deductible, such as:

• Preventive care like annual checkups or vaccinations

• Certain telehealth visits

• Some prescription drugs (if your plan separates these from your deductible)

For nearly everything else—specialist visits, lab work, imaging, urgent care, and emergency room visits—you must meet your deductible before your plan begins cost-sharing.

In practice, this means that in January, February, and possibly beyond, you’re absorbing 100% of your costs, even though you’re insured.

Deductibles Don’t Work Alone: The Hidden Stack of Cost-Sharing

Even after meeting your deductible, other cost-sharing mechanisms kick in:

• Copayments: Flat fees for services like doctor visits or prescriptions.

• Coinsurance: A percentage of the bill you pay for certain services even after the deductible is met.

• Out-of-pocket maximums: The total you’ll spend before the plan pays 100%—but only for covered services.

Deductibles are just the first financial hurdle. Once cleared, you’re still not free from costs until you hit your plan’s out-of-pocket maximum—often ranging from $5,000 to $7,500 for individuals and up to $15,000 for families in 2025 PSHB plans.

The Financial Risk Transfer You Didn’t See Coming

The purpose of a deductible is to make you think twice before using care—yet the result is often the opposite of what was intended. People delay or skip necessary care to avoid high upfront costs. This delay can lead to:

• Worsened health outcomes due to untreated conditions

• Higher long-term expenses as issues become more serious

• Greater use of emergency services when symptoms escalate

This is how the risk shifts subtly—but powerfully—back onto you. The cost barrier isn’t just financial. It’s clinical and psychological.

Annual Planning: Why Your Deductible Should Shape Your Budget

If you’re not budgeting for your deductible, you’re not budgeting accurately. That’s because your deductible is often the largest single health expense you control.

Planning tools you should consider:

• Set aside funds in January to cover your deductible early, especially if you expect medical care.

• Use Flexible Spending Accounts (FSAs) if available. In 2025, you can contribute up to $3,300, with a $660 carryover.

• Evaluate your plan choice each November during Open Season to see if your deductible still matches your healthcare usage.

You’re paying premiums every month—but unless you’ve met your deductible, those premiums aren’t translating into coverage just yet.

What Happens When You Don’t Meet the Deductible

Here’s the scenario that plays out for many enrollees: You pay your monthly premiums, but never quite reach your deductible. As a result:

• You pay for most services out-of-pocket.

• Your insurance never actually pays for non-preventive care.

• Your total healthcare spending ends up higher than expected.

In this case, you’re paying for protection you’re not using. It may be time to rethink whether a high-deductible plan is still right for your situation, especially if you’re retired or managing chronic conditions.

Deductibles and Retirement: A Tougher Equation

Retired annuitants under PSHB may feel the impact of deductibles more sharply:

• Fixed incomes make surprise expenses harder to absorb.

• You may not use enough services to meet the deductible annually.

• If you coordinate PSHB with Medicare Part B, you may see reduced deductibles or waived costs, depending on your plan.

In 2025, this coordination remains one of the most effective ways to lessen your financial burden—but only if you’re enrolled in both PSHB and Medicare Part B. Some plans even offer reimbursements or incentives when both coverages are active.

Not All Services Apply to the Deductible Equally

Even within your deductible, certain exclusions can lead to confusion. For example:

• Copays for specific services may not count toward your deductible.

• Out-of-network charges may have a separate, higher deductible.

• Pharmacy benefits under a Medicare Part D EGWP plan may have their own separate deductible (capped at $590 in 2025).

Understanding these distinctions helps prevent miscalculations—and expensive surprises—throughout the year.

Why Deductibles Continue to Rise

Deductibles have steadily increased over the past decade. In 2024, many PSHB enrollees already faced deductibles 10%–20% higher than just a few years prior. In 2025, the trend continues for several reasons:

• Rising healthcare costs nationwide

• Emphasis on consumer-directed health plans

• Shifts in plan design to control premium growth

The net effect? Premiums may feel stable, but deductibles have quietly grown, shifting more cost risk to you.

Don’t Confuse Plan Coverage with Plan Payment

There’s a critical difference between a service being “covered” and your plan actually paying for it.

• A covered service still requires you to meet the deductible before the plan contributes.

• Only after the deductible is satisfied will the plan begin paying its share, based on your coinsurance or copay terms.

This confusion leads many to believe they’re being unfairly billed, when in fact, the deductible is working exactly as written.

How to Lower the Burden of Deductibles in 2025

While you can’t eliminate the deductible, you can make smarter choices:

• Stay in-network: You’ll pay less and apply expenses toward your in-network deductible.

• Bundle appointments early in the year: Meet your deductible faster, unlocking cost-sharing benefits sooner.

• Use preventive services: These are covered in full and help you maintain your health without triggering deductible spending.

• Coordinate with Medicare if eligible: Many PSHB plans offer extra cost-saving features when combined with Medicare Part B.

Understanding Your Financial Role in 2025 Health Coverage

Your PSHB deductible isn’t just a number on a benefits sheet—it’s a structural feature of your plan that directly affects your wallet, especially early in the year.

If you’re not actively accounting for it, you may be overpaying, underutilizing your benefits, or misunderstanding why you’re getting bills even while insured.

Review your plan documents carefully and take advantage of professional support when needed. A licensed agent listed on this website can walk you through how your deductible functions and what strategies may help you better manage your coverage this year.