Key Takeaways

• Missing key PSHB enrollment deadlines or requirements can lead to unexpected gaps in coverage or higher costs. Planning ahead is crucial.

• Understanding how PSHB interacts with Medicare and your retirement benefits helps you avoid costly surprises when transitioning from active employment to retirement.

Overlooking the Importance of Enrollment Deadlines

Timing matters when it comes to PSHB enrollment. If you’re still working for USPS, you need to understand when and how to enroll to avoid losing coverage or paying more than expected.

• New employees: If you’re newly hired, you must enroll within the first 60 days of becoming eligible. Missing this window means waiting until the next Open Season, which could result in a costly coverage gap.

• Open Season: This occurs annually from November to December, allowing you to make changes to your plan. If you fail to review your options, you might get stuck with a plan that no longer suits your needs or that increases in cost unexpectedly.

• Qualifying Life Events (QLEs): Events like marriage, divorce, or having a child allow you to make changes outside of Open Season. If you don’t update your plan in time, you may end up with insufficient or unnecessary coverage that doesn’t reflect your new circumstances.

• Retirement Transition: If you’re moving from active employment to retirement, failing to update your enrollment could lead to gaps in coverage or higher costs. You must ensure a smooth transition to maintain uninterrupted health benefits.

Assuming Your Current Plan Automatically Carries Over

Many USPS employees and retirees assume that if they don’t take action, their existing plan will seamlessly transition into the PSHB system. While automatic enrollment may occur in some cases, you should always double-check your coverage details to ensure you’re still getting the benefits you need.

• Plan availability changes: Not all FEHB plans transition to PSHB. If your plan is discontinued, you must actively select a new one to prevent losing coverage.

• Coverage differences: Even if your plan name remains the same, benefits, deductibles, and premiums may change. Reviewing these details ensures you aren’t caught off guard by higher costs or reduced coverage.

• Missed opportunities: Failing to compare available options could mean missing out on better coverage that aligns with your current and future healthcare needs.

• Incorrect automatic enrollments: Some enrollees may be automatically placed in a plan that doesn’t suit their needs. Checking your enrollment status ensures you’re in the right plan for your circumstances.

Misunderstanding Medicare Requirements for Retirees

If you’re a retiree or approaching retirement, Medicare plays a significant role in your healthcare costs and coverage. Failing to understand how PSHB interacts with Medicare can lead to expensive mistakes.

• Medicare Part B enrollment: If you retire after January 1, 2025, and are eligible for Medicare, you must enroll in Part B to maintain PSHB coverage. Skipping Part B can result in higher out-of-pocket costs and a potential loss of PSHB benefits.

• Late enrollment penalties: If you delay enrolling in Medicare Part B when first eligible, you’ll face lifetime penalties that increase your monthly premium.

• Coordination of benefits: Understanding how PSHB works alongside Medicare helps you maximize benefits and reduce unnecessary expenses. If you don’t properly coordinate, you could end up paying for duplicate coverage or missing out on important benefits.

• Prescription drug coverage confusion: Some PSHB plans integrate with Medicare Part D, while others do not. Choosing the wrong option could mean higher medication costs or gaps in coverage.

Ignoring Out-of-Pocket Costs When Choosing a Plan

PSHB plans vary widely in terms of premiums, deductibles, and out-of-pocket expenses. Many enrollees make the mistake of focusing solely on the monthly premium without considering the full cost of healthcare.

• Deductibles and copayments: Some plans have lower premiums but higher deductibles and copayments. Make sure you calculate your estimated annual healthcare expenses based on your medical needs.

• Prescription drug coverage: Certain PSHB plans integrate with Medicare Part D, but coverage levels differ. Review drug formularies to ensure your medications are covered at a reasonable cost.

• Provider networks: Choosing an out-of-network provider can lead to significantly higher out-of-pocket costs. Make sure your preferred doctors and specialists are covered under your plan.

• Emergency and urgent care costs: Some plans have higher costs for out-of-network emergency care. Knowing these costs ahead of time can prevent financial shocks.

• Hidden costs: Plans may have extra costs for services like physical therapy, mental health care, or specialist visits. Always check the full range of covered services before making a decision.

Failing to Review Family Coverage Options

If you cover dependents under your PSHB plan, you need to understand how different enrollment choices impact your household.

• Self Plus One vs. Self and Family: If you’re covering just yourself and one dependent, the Self Plus One option may be more cost-effective than the full Self and Family plan. However, some plans charge nearly the same for both options, so compare before deciding.

• Dependent eligibility: Children are eligible for coverage until age 26, but once they age out, they’ll need separate coverage. Planning for this transition prevents unexpected coverage gaps.

• Spousal considerations: If your spouse has separate employer-sponsored coverage, weigh the costs and benefits of maintaining dual coverage versus consolidating under one plan.

• Adding or removing dependents: If your family situation changes, failing to update your plan could mean overpaying for coverage you don’t need or losing necessary benefits.

Not Factoring in Retirement and Long-Term Healthcare Needs

Your healthcare needs in retirement may be very different from your current needs. If you don’t plan ahead, you could face rising costs and limited coverage options.

• Long-term care planning: While PSHB covers medical expenses, it does not include long-term care. Considering supplemental coverage early can help you avoid financial strain later.

• Future premium increases: While current premiums may be affordable, healthcare costs typically rise. Budgeting for future increases ensures you’re financially prepared.

• Chronic condition coverage: If you have ongoing medical conditions, compare plans carefully to find one that offers comprehensive coverage for your treatments and medications.

• Preventive care and wellness benefits: Some plans provide better coverage for preventive services, which can help lower healthcare costs in the long run.

Skipping the Annual Review Process

Even if you’re satisfied with your PSHB plan today, failing to review it annually could lead to missed savings or unexpected cost increases.

• Changes in benefits: Insurers adjust benefits, provider networks, and cost-sharing structures regularly. Staying informed prevents surprises.

• Personal health changes: Your healthcare needs may change over time. Reviewing your plan ensures it still meets your medical and financial requirements.

• New plan options: Each Open Season, new plans may be introduced while others are discontinued. Comparing options can help you find better coverage or lower costs.

• Changes in family circumstances: If you get married, divorced, or have a child, your healthcare needs may shift. Failing to update your coverage can lead to unnecessary costs or gaps in care.

Don’t Let Enrollment Mistakes Cost You—Plan Ahead

PSHB enrollment mistakes can lead to higher expenses, gaps in coverage, or unnecessary complications. By staying informed and proactive, you can ensure that your healthcare plan aligns with your needs both now and in the future. If you’re unsure about the best options for your situation, get in touch with a licensed agent listed on this website for professional advice tailored to your needs.