Key Takeaways:

1. The Postal Service Health Benefits (PSHB) program is rolling out on January 1, 2025, with Open Season happening from November 11, 2024, to December 9, 2024. Be ready for new premiums and ensure you’re prepared for the changes ahead.
2. PSHB premiums are split with the government covering 72% and postal workers paying 28%, so understanding these shifts will help you manage your healthcare costs more effectively.

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If you’re a postal worker, you’re likely aware that the new Postal Service Health Benefits (PSHB) program is just around the corner. With the Open Season from November 11, 2024, to December 9, 2024, and the full launch on January 1, 2025, now is the time to get ahead of the changes. The PSHB program, introduced as part of the Postal Service Reform Act of 2022, is set to replace the Federal Employees Health Benefits (FEHB) program for postal workers. This means that if you’re currently enrolled in FEHB, you’ll be automatically transitioned to a PSHB plan—unless you make changes during Open Season. So, what should you know to stay ahead of the curve? Let’s dive into the key details and breakdowns of the new premiums, the government’s contribution, and how this program will impact your wallet.

What’s Changing with the PSHB Program?

The PSHB program was designed to specifically cater to the healthcare needs of postal workers and retirees. While the structure of the program resembles the FEHB in some ways, the Postal Service Reform Act of 2022 introduced this change as part of a larger effort to stabilize the financial situation of the U.S. Postal Service. It aligns more closely with Medicare, especially for retirees, which is a significant change you’ll want to pay attention to if you’re nearing retirement age or already retired. The program’s premium structure will still be split between the government and employees, with the government covering 72% of the total premium and postal employees contributing 28%. This setup is designed to keep healthcare costs manageable for postal workers while balancing the Postal Service’s financial obligations.

How Are PSHB Premiums Structured?

As a postal worker, understanding how your premiums are structured is essential to planning your healthcare budget for 2025. The biweekly premiums for the PSHB program are broken down as follows:

• Self Only: The average total biweekly premium is $397.35.
• Self Plus One: The average total biweekly premium is $858.89.
• Self and Family: The average total biweekly premium is $934.65.

Out of these totals, the government will contribute 72%, significantly reducing your out-of-pocket costs. So, let’s look at what your portion will be:

• Self Only: Your biweekly contribution will be about $111.26.
• Self Plus One: Your biweekly contribution will be about $240.49.
• Self and Family: Your biweekly contribution will be about $261.70.

Over the course of 26 pay periods, that adds up to annual costs of:

• Self Only: $2,892.76
• Self Plus One: $6,252.74
• Self and Family: $6,804.20

With these numbers in mind, you can begin to plan your healthcare expenses for 2025. It’s important to keep in mind that while the PSHB program aims to maintain affordability, premium costs are still a significant part of your overall budget.

Why Medicare Matters for Retirees

One of the biggest shifts with the new PSHB program is its alignment with Medicare, especially for retirees. Here’s what you need to know:

• If you retire on or before January 1, 2025, and you’re not already enrolled in Medicare Part B, you won’t be required to enroll to maintain your PSHB coverage. This rule also applies to your covered family members.
• If you retire after January 1, 2025, you will need to enroll in Medicare Part B when you become eligible (typically at age 65) in order to keep your PSHB coverage. This change is designed to reduce overall healthcare costs by coordinating benefits between PSHB and Medicare.

Medicare Part B enrollment is an important factor to consider if you’re close to retirement. While it adds an additional monthly premium, Medicare Part B can help cover services like doctor visits and outpatient care, which can lower your out-of-pocket costs under the PSHB program. However, it’s essential to balance those savings against the extra cost of enrolling in Part B.

Preparing for Open Season 2024

With Open Season coming up fast—November 11, 2024, to December 9, 2024—this is your window to make decisions about your healthcare coverage for 2025. If you don’t make any changes, you’ll be automatically transitioned to a PSHB plan that aligns with your current FEHB coverage. But this period is also your chance to evaluate your healthcare needs and decide if you need to switch to a different plan. Here’s how you can prepare:

• Review Your Premiums: Take a good look at the premium breakdowns for Self Only, Self Plus One, and Self and Family coverage. Which plan fits your budget and healthcare needs best? Remember that while PSHB plans are designed to offer comprehensive coverage, the premium amounts will vary depending on the plan you choose.
• Consider Medicare Part B: If you’re nearing retirement or already retired, now is the time to think about how Medicare Part B enrollment will affect your healthcare costs. Enrolling in Part B could help lower your overall expenses under the PSHB program, but it does come with its own premiums.
• Evaluate Your Healthcare Needs: Has your health changed over the past year? Do you expect to need more medical care in 2025, such as more frequent doctor visits or prescription medications? If so, you may want to adjust your plan to make sure it covers these needs without breaking the bank.
• Check for Exceptions: If you’re living abroad, receiving care through the VA, or using Indian Health Services, you might be exempt from the Medicare Part B requirement. However, it’s important to review the details carefully. If your situation changes, you may need to enroll in Part B later.

How the Postal Service Reform Act of 2022 Affects You

The Postal Service Reform Act of 2022 didn’t just create the PSHB program—it was part of a larger overhaul aimed at stabilizing the Postal Service’s finances. The Act addresses the Postal Service’s long-term financial health while ensuring that postal employees and retirees have access to reliable, affordable healthcare. By shifting postal retirees to Medicare Part B and implementing the PSHB program, the Act is designed to reduce the overall burden of healthcare costs on both the Postal Service and its workers. This is intended to ensure that the Postal Service remains financially sustainable in the years to come, while still providing the healthcare benefits postal employees have come to rely on.

Budgeting for Healthcare in 2025

Now that you know what to expect from PSHB premiums and Medicare Part B, it’s time to plan your healthcare budget for 2025. Start by calculating your annual out-of-pocket costs based on the coverage level that works best for you—whether that’s Self Only, Self Plus One, or Self and Family. Don’t forget to factor in any additional costs, such as copays, deductibles, and prescription drug costs. These can vary depending on your specific healthcare needs, so it’s important to plan for them ahead of time. And if you’re considering enrolling in Medicare Part B, make sure to include that premium in your calculations. By understanding the full picture of your healthcare costs, you can make more informed decisions during Open Season and ensure that you’re not caught off guard by rising expenses in 2025.

Navigating the Changes: What You Can Do Now

So, how can you make sure you’re fully prepared for the upcoming changes? Here are a few steps you can take right now:

1. Mark Your Calendar for Open Season: November 11, 2024, to December 9, 2024, is the time to review your healthcare plan options and make any necessary changes. Don’t miss this window—it’s your chance to ensure that your healthcare coverage is optimized for 2025.
2. Start Reviewing Your Finances: Take the time to calculate how the PSHB premiums and possible Medicare Part B enrollment will fit into your overall budget. By planning ahead, you can avoid any surprises and ensure that your healthcare costs are manageable.
3. Stay Informed: Keep an eye on communications from the Postal Service and the Office of Personnel Management (OPM) for any updates or important information related to the PSHB program. The more you know, the better equipped you’ll be to make the right decisions.

Be Ready for PSHB in 2025

As the January 1, 2025, launch date for the Postal Service Health Benefits program approaches, it’s crucial to stay ahead of the curve. Understanding how the premiums are structured, preparing for Medicare Part B requirements, and reviewing your coverage options during Open Season will help you navigate these changes with confidence.