Key Takeaways

  • Medicare Part C (Medicare Advantage) may seem like a simple, bundled alternative, but it can limit your access to providers and coverage compared to Original Medicare paired with PSHB.

  • If you’re a Postal Service Health Benefits (PSHB) enrollee, understanding how Medicare Advantage interacts with your existing federal benefits is essential to avoid losing access to cost-sharing protections and prescription drug advantages.

What Part C Promises vs. What It Delivers

At first glance, Medicare Part C appears to be a convenient option. It combines hospital, medical, and often drug coverage into a single plan. Many people are drawn to it because of this all-in-one approach. But what’s often missing from the brochures is how Medicare Advantage changes the way you receive care.

Part C plans are administered by private insurance companies, and while they must provide at least the same coverage as Original Medicare (Parts A and B), they often come with their own rules, restrictions, and networks. For PSHB annuitants, that difference can be significant.

Network Limitations and Referrals

Medicare Advantage plans often operate within defined networks. This means:

  • You may be required to use doctors, hospitals, or specialists within a specific service area.

  • Referrals may be needed to see specialists.

  • Out-of-network care is usually not covered, or comes with higher out-of-pocket costs.

This is a major contrast from Original Medicare combined with a PSHB plan, which typically allows you to visit any provider that accepts Medicare.

PSHB Plans and Nationwide Access

In 2025, PSHB plans continue to offer broad access to providers across the country, especially when coordinated with Medicare Parts A and B. If you live in one state but travel frequently or relocate seasonally, you maintain your flexibility.

Medicare Advantage plans, on the other hand, may not follow you across state lines. Many are regional, with strict service areas. If you seek care outside that region, coverage may be denied or significantly limited.

Prior Authorization Requirements

Medicare Advantage plans often require prior authorization before they cover services such as:

  • Imaging (MRI, CT scans)

  • Home health care

  • Durable medical equipment

  • Certain surgeries

These administrative hurdles can delay or deny needed care. Original Medicare, by contrast, rarely requires prior authorization. PSHB plans generally follow Medicare’s rules and offer less red tape.

Drug Coverage Integration

Some Medicare Advantage plans include built-in Part D prescription drug coverage. However, this isn’t always a benefit. These drug formularies are narrower than those in most PSHB plans.

Here’s how that can affect you:

  • You may face higher copayments or coinsurance for non-preferred drugs.

  • Your medication may not be covered at all if it’s not on the plan’s formulary.

  • You could be required to try cheaper drugs (step therapy) before the plan covers what your doctor prescribed.

Under the PSHB program in 2025, Medicare-eligible annuitants are automatically enrolled in a Medicare Part D Employer Group Waiver Plan (EGWP), which typically includes a broader formulary and stronger consumer protections than retail Part D plans tied to Medicare Advantage.

Financial Protection Differences

One of the most misunderstood elements of Medicare Advantage is how out-of-pocket costs are structured. In 2025, the maximum out-of-pocket (MOOP) limit for in-network Medicare Advantage services is $9,350, and up to $14,000 when including out-of-network care.

Compare that to PSHB plans coordinated with Original Medicare:

  • You often pay $0 or low cost-sharing for services that Medicare covers.

  • Many PSHB plans waive deductibles, copays, and coinsurance when Medicare is the primary payer.

  • Prescription drug costs are capped at $2,000 annually under the integrated Part D EGWP.

These PSHB-Medicare pairings offer more predictable and often lower out-of-pocket expenses, especially for those managing chronic conditions or high healthcare utilization.

Coordination of Benefits Gets Complicated

With Medicare Advantage, the private insurer becomes the primary payer. This changes how your PSHB plan functions. It may no longer act as a secondary payer to cover remaining costs, since it’s no longer coordinating with Original Medicare.

This can result in:

  • You being fully subject to the Medicare Advantage plan’s cost structure.

  • Loss of the cost-sharing protections your PSHB plan would have provided.

  • Limited or no reimbursement for services that are only partially covered under the Medicare Advantage plan.

By contrast, sticking with Original Medicare allows your PSHB plan to wrap around and fill in gaps, creating more comprehensive protection.

Appeals and Denials

Another overlooked issue is the appeals process. Under Original Medicare, you appeal through Medicare itself. Under Medicare Advantage, you must go through the private plan’s internal appeal process first.

This means:

  • Delays in care during the appeals process.

  • Additional administrative steps.

  • Greater likelihood of denied claims being upheld unless escalated.

If you value timely care without layers of corporate gatekeeping, staying with Original Medicare and a PSHB plan may offer a smoother experience.

Emergency and Urgent Care

While Medicare Advantage plans are required to cover emergency care anywhere in the United States, the rules around urgent care and follow-up visits can vary.

Some plans:

  • Limit urgent care coverage to contracted facilities.

  • Require prior approval for certain post-discharge services.

  • Refuse to cover follow-up care unless it occurs in-network.

These limitations can be especially burdensome if you are traveling, visiting family, or live part of the year outside your plan’s coverage area.

Extra Benefits: Not Always a True Value

Medicare Advantage plans often advertise additional perks like dental, vision, hearing, gym memberships, or transportation. While these sound appealing, they are not standardized and may be minimal in scope.

Important things to know:

  • Coverage may be limited to specific providers or services.

  • You may need to use separate networks or vendors.

  • PSHB plans often offer more robust dental and vision options through FEDVIP.

In many cases, you may find better and more predictable access to these benefits through a combination of PSHB and other federal options than through a bundled Medicare Advantage plan.

Enrollment and Lock-In Periods

Medicare Advantage plans have limited windows to make changes:

Outside these windows, you’re locked in unless you qualify for a Special Enrollment Period (SEP). This makes switching difficult if you become dissatisfied.

PSHB enrollment is more flexible:

  • Annual Open Season (November to December) allows changes.

  • Qualifying Life Events (QLEs) such as retirement or relocation allow mid-year changes.

When you coordinate PSHB with Original Medicare, you retain flexibility that Medicare Advantage often restricts.

What Happens to Your PSHB Plan With Medicare Advantage

If you enroll in a Medicare Advantage plan, your PSHB plan may only serve as a secondary or wraparound benefit—or it might not coordinate at all. In some cases, you may be paying for a PSHB plan that’s duplicative or underutilized.

Key issues to consider:

  • Some PSHB plans don’t coordinate with Medicare Advantage at all.

  • You may lose access to features like premium reimbursements or waived deductibles.

  • Prescription drug coordination can be disrupted.

It’s essential to confirm how your PSHB plan handles Medicare Advantage enrollees before making the switch.

Why Many PSHB Enrollees Stick With Original Medicare

In 2025, more PSHB enrollees are opting to remain with Original Medicare paired with their PSHB plan. The reasons include:

  • Fewer restrictions on provider choice.

  • Better cost-sharing protections.

  • Simpler coordination between Medicare and PSHB.

  • Superior prescription drug coverage.

While Medicare Advantage may appear attractive on the surface, a deeper look reveals gaps that can cost more in the long run, especially if you’re accustomed to the wide protections PSHB has traditionally offered.

Before You Choose, Review the Fine Print

You deserve peace of mind when making Medicare decisions. For Postal Service retirees and annuitants, combining Original Medicare with a well-chosen PSHB plan offers comprehensive, flexible, and financially protective coverage that’s hard to match. If you’re considering Medicare Advantage, examine the provider networks, coverage limitations, and cost-sharing structure carefully. What looks like a benefit today might become a burden tomorrow.

For personalized advice based on your specific PSHB plan and retirement needs, get in touch with a licensed agent listed on this website.