Key Takeaways
- The switch from FEHB to the new Postal Service Health Benefits (PSHB) program is a major shift for postal workers and retirees, especially when it comes to Medicare Part B.
- With the PSHB Open Season running from November 11, 2024, to December 9, 2024, and the program launching on January 1, 2025, it’s time to make sure your retirement health plan is aligned with these changes.
What You Need to Know About the Medicare Part B and PSHB Transition
If you’re a postal worker or retiree, chances are you’ve already heard about the big changes coming your way in 2025. The launch of the Postal Service Health Benefits (PSHB) program on January 1, 2025, marks the start of a new era for health benefits. Whether you’re nearing retirement or already enjoying it, the transition to PSHB from the Federal Employees Health Benefits (FEHB) program could impact how you handle your healthcare—and one of the biggest pieces of the puzzle is Medicare Part B. As we move closer to the PSHB Open Season, running from November 11, 2024, to December 9, 2024, you may be wondering how to prepare. Let’s walk through what’s happening, how Medicare Part B fits into the picture, and what you need to consider to make sure your health plan is ready for this big shift.Why Medicare Part B Matters for Postal Workers
For postal workers, retirees, and their families, the new PSHB program will bring changes, especially for those who are already retired or planning to retire soon. Under the new system, once you become eligible for Medicare, enrolling in Medicare Part B will become mandatory to maintain your PSHB coverage. This requirement affects anyone who turns 65 after the PSHB launch and wants to keep their coverage without interruption. You might be asking yourself, “Why do I need both PSHB and Medicare Part B?” The answer lies in how the two programs work together to provide comprehensive coverage. Medicare Part B generally covers outpatient services, doctor visits, and other medical needs, while PSHB will continue to offer more extensive coverage for things like hospital stays and prescription drugs. Together, these programs can help reduce your out-of-pocket costs by filling in the gaps Medicare doesn’t cover.The New PSHB Mandate for Medicare Part B Enrollment
For current retirees, the rules surrounding Medicare enrollment have varied depending on your circumstances, but things will tighten up under PSHB. Beginning January 1, 2025, retirees who become eligible for Medicare Part B will need to enroll in order to maintain their PSHB coverage. This is a significant change, especially for those who might not have considered enrolling in Medicare Part B before. The PSHB program is designed to work hand-in-hand with Medicare, and not enrolling could mean higher costs or loss of benefits. If you’re already retired and not yet 65, keep an eye on your Medicare eligibility date because failing to enroll in Part B when the time comes could result in penalties. For those who are already enrolled in both FEHB and Medicare Part B, this transition may be smoother, but it’s still important to review the details of the new PSHB plan to ensure it meets your healthcare needs.How Will Medicare Part B Impact Your Healthcare Costs?
Let’s talk about what this means for your wallet. If you’re thinking about how this affects your overall healthcare costs, it’s important to consider the premiums and out-of-pocket expenses involved. Medicare Part B does come with a monthly premium. In 2024, the standard premium for Medicare Part B is $174.70 per month, though this amount can increase based on your income. Once you’re on both Medicare Part B and PSHB, the combination should help keep your out-of-pocket costs manageable. PSHB plans are expected to cover many of the expenses Medicare Part B doesn’t, such as deductibles and coinsurance, potentially lowering the total amount you pay out of pocket for healthcare services. This could make up for the additional cost of paying the Medicare Part B premium, especially if you have regular doctor visits or need outpatient care.The Medicare Part B Enrollment Timeline You Can’t Ignore
So, what’s the timeline for all of this? Here’s the critical part: if you are a postal worker retiring after January 1, 2025, or if you turn 65 after that date, you must enroll in Medicare Part B when you become eligible. Typically, the enrollment window for Medicare Part B starts three months before your 65th birthday and ends three months after. Missing this window could result in late penalties, which means you’ll pay higher premiums for the rest of your life. But don’t worry—during PSHB Open Season (November 11, 2024, to December 9, 2024), you’ll have a chance to review your options, compare plans, and make any necessary changes. This is the perfect time to ensure you’re prepared for Medicare Part B enrollment and that your retirement healthcare strategy is rock-solid before PSHB rolls out in January 2025.Do You Have to Sign Up for Medicare Part B If You’re Living Abroad?
One important note for those who are retired and living outside the U.S.: you may be exempt from the Medicare Part B enrollment requirement. Since Medicare doesn’t provide coverage abroad, you won’t need to enroll in Part B if you’re residing overseas. However, if you return to the U.S. and want to maintain PSHB coverage, enrolling in Medicare Part B will become necessary. Additionally, veterans receiving healthcare through the VA system might also be exempt from the Medicare Part B mandate. However, it’s worth reviewing your specific situation during the PSHB Open Season to confirm what steps you need to take.What Should You Do During PSHB Open Season?
Now that we’ve covered the basics of how Medicare Part B fits into the new PSHB program, let’s talk about how to take action. The PSHB Open Season is your window to review, compare, and make changes to your health coverage. Starting November 11, 2024, through December 9, 2024, you’ll have the opportunity to select a PSHB plan that best fits your needs. It’s crucial to look at all the plan details, including how they work with Medicare Part B, the premium costs, and the out-of-pocket expenses. Here’s what I recommend doing during Open Season:- Review Your Current Health Coverage – Take a close look at your current FEHB plan, and see how it compares to the available PSHB options. Check whether your preferred doctors and hospitals are still in-network, and if not, consider what alternatives are available.
- Evaluate the Need for Medicare Part B – If you’re approaching 65 or already retired, make sure you understand how Medicare Part B will work with PSHB. Calculate the premiums and consider the overall impact on your healthcare costs.
- Enroll or Adjust as Needed – Once you’ve reviewed your options, don’t forget to make any necessary changes to your coverage during Open Season. This is your chance to ensure that you’re set up for the coming year with the healthcare benefits you need.
