Key Takeaways

• If you’re a Medicare-eligible Postal Service retiree or family member, enrolling in Medicare Part B is now a requirement to keep your PSHB plan.

• Not enrolling in Medicare Part B if you’re required to do so may result in the loss of your PSHB coverage altogether, with few exceptions.

The New Rule That Alters Your PSHB Eligibility

Starting in 2025, the Postal Service Health Benefits (PSHB) Program introduces a major shift for Medicare-eligible enrollees. If you’re a Postal Service annuitant or family member aged 65 or older, you are now required to enroll in Medicare Part B to maintain your PSHB coverage—unless you qualify for a limited exception.

This isn’t a suggestion. It’s a rule tied to the Postal Service Reform Act of 2022, and it directly impacts your ability to stay covered. This makes your Medicare decision more than just a financial or healthcare choice. It becomes a legal prerequisite.

Who Must Enroll in Medicare Part B in 2025

You are required to enroll in Medicare Part B if all the following apply to you:

• You are enrolled or plan to enroll in a PSHB plan.

• You are Medicare-eligible due to age (65+) or disability.

• You retired after January 1, 2025.

If you meet these conditions and fail to enroll in Medicare Part B, you will not be eligible to maintain your PSHB health insurance. This rule extends to Medicare-eligible family members covered under your plan.

Who Is Exempt from the Requirement

You are exempt from the Medicare Part B enrollment requirement if:

• You retired on or before January 1, 2025, and were not already enrolled in Part B.

• You are an employee aged 64 or older as of January 1, 2025.

• You live permanently overseas where Medicare coverage doesn’t apply.

• You receive Veterans Affairs (VA) or Indian Health Services (IHS) benefits and qualify for exception.

Even if you’re exempt, it is strongly encouraged to review how Medicare could work in your favor. Many PSHB plans reduce your out-of-pocket costs when paired with Medicare.

What Happens If You Don’t Enroll in Part B

Failure to enroll in Medicare Part B when required will result in termination of your PSHB coverage. And this decision isn’t reversible by simply enrolling later.

If you miss your initial enrollment window or special enrollment period (SEP), you might have to wait until the General Enrollment Period (January 1 to March 31), and your PSHB eligibility could be gone by then.

Additionally, Medicare imposes a late enrollment penalty for each year you delay signing up for Part B without credible coverage. This penalty is permanent and increases the longer you wait.

The Financial Stakes Are Higher Now

In 2025, the standard Medicare Part B premium is $185 per month. That’s a baseline. Higher-income beneficiaries pay more due to the Income-Related Monthly Adjustment Amount (IRMAA).

While this might feel like an extra expense, many PSHB plans reduce copayments, deductibles, and coinsurance amounts when you are enrolled in both Medicare and PSHB. In fact, pairing both often leads to significantly lower total annual costs.

Not enrolling could leave you with full PSHB cost-sharing responsibilities, which may be much higher than the Medicare premium.

How PSHB and Medicare Work Together

Once enrolled in both programs, Medicare becomes your primary payer, and PSHB becomes secondary. This means:

• Medicare pays first for most medical services.

• Your PSHB plan picks up most or all of the remaining costs.

Some of the cost-saving advantages include:

• Reduced or waived deductibles

• Lower copayments for physician visits

• Lower or no coinsurance for hospital stays

• Automatic enrollment in a Medicare Part D prescription plan (via EGWP)

These benefits vary by plan, but across the board, being dual-enrolled reduces your exposure to high healthcare costs.

Timing Matters: Key Enrollment Periods

Your Medicare enrollment should align with your PSHB coverage start date. Missing the timeline can create gaps in coverage or disqualify you from the PSHB plan.

Initial Enrollment Period (IEP)

• Starts 3 months before you turn 65

• Includes your birthday month

• Ends 3 months after your birthday month

Special Enrollment Period (SEP) for Postal Annuitants (2024 Only)

• Ran from April 1 to September 30, 2024

• This SEP allowed certain annuitants to enroll in Part B without penalty if they missed their IEP.

General Enrollment Period (GEP)

• Runs January 1 to March 31 each year

• Coverage begins July 1

• Late enrollment penalties apply

Prescription Coverage Automatically Included

If you’re enrolled in Medicare and PSHB, you’re automatically covered under a Medicare Part D Employer Group Waiver Plan (EGWP). This integrated prescription drug benefit has:

• A $2,000 annual out-of-pocket cap

• A $35 insulin copay cap

• No donut hole coverage gap as of 2025

There is no need to enroll separately in a stand-alone Part D plan. In fact, doing so may result in the loss of PSHB prescription benefits.

Medicare Part B and Your Family Members

The Medicare enrollment requirement applies to each Medicare-eligible family member covered under your PSHB plan. If one eligible family member fails to enroll, it can jeopardize that individual’s coverage but not necessarily the entire family plan.

However, PSHB plans will coordinate differently for family members based on their Medicare status. It is important to verify each person’s enrollment and eligibility.

How to Confirm Your Enrollment and Status

You should confirm your Medicare Part B enrollment status before January 1, 2025, to avoid PSHB termination. Key steps include:

• Visiting Medicare.gov to confirm enrollment

• Checking with your PSHB plan for integration details

• Contacting OPM or the PSHB Help Line for assistance

What to Know if You Delay Retirement

If you are still working past age 65 and covered under an active employee health plan, you are not required to enroll in Medicare Part B yet. You can delay Part B enrollment without penalty and retain PSHB eligibility upon retirement if you enroll during a valid SEP.

Once you retire, however, you must act quickly. You’ll have 8 months from your retirement date to enroll in Part B under SEP without penalty. After that, you risk both late penalties and loss of PSHB coverage.

Planning Ahead to Protect Your Health and Budget

With Medicare Part B now tied to PSHB eligibility, your retirement planning must change. This affects not only your healthcare but also your monthly budget, timing of retirement, and coordination with other benefits.

The most effective approach is to align your Part B enrollment with your PSHB start date, monitor your eligibility, and ensure all Medicare-eligible family members are enrolled. Taking action in advance reduces your risk of uncovered services, penalties, or disqualification from your plan.

Your Enrollment Decisions Shape Your Entire PSHB Experience

The new 2025 rules make it impossible to treat Medicare and PSHB as separate decisions. They are now fully integrated in eligibility, timing, and financial consequences. One missed step can lead to cascading issues.

If you’re unsure how this affects you or your family, it’s critical to talk to someone who understands the intricacies of both programs. Reach out to a licensed agent listed on this website to review your current plan, check for any red flags, and make a smooth transition into Medicare-integrated PSHB coverage.