Key Takeaways

  • Some Medicare Advantage plans may duplicate benefits already included in your PSHB plan, while others might leave gaps that affect your access to care or prescription coverage.

  • Coordinating Medicare Advantage with PSHB requires a detailed review of both plans’ benefits, networks, and cost structures to avoid unexpected out-of-pocket expenses.

Understanding How Medicare Advantage and PSHB Interact

As a Postal Service annuitant or employee approaching Medicare eligibility, you face a critical question: Should you enroll in a Medicare Advantage (Part C) plan when you already have PSHB coverage? On the surface, having both might seem like extra protection, but the reality is more complex.

PSHB plans in 2025 are designed to coordinate with Original Medicare (Parts A and B). While some plans may offer additional benefits when you’re enrolled in Medicare, others may change cost-sharing responsibilities or provider access if you pair them with a Medicare Advantage plan. In certain cases, you might even lose important coverage or face restricted provider networks.

Let’s explore how overlaps and gaps can occur, what they mean for you, and how to assess whether enrolling in a Medicare Advantage plan makes sense.

What PSHB Covers When You Have Medicare

If you are Medicare-eligible and enroll in both Medicare Part A and Part B, your PSHB plan becomes secondary. In this setup, Medicare pays first, and PSHB covers the rest.

This coordination offers several advantages:

  • Reduced Out-of-Pocket Costs: Many PSHB plans waive or reduce deductibles, copayments, and coinsurance when Medicare is primary.

  • Lower Prescription Drug Costs: If you’re enrolled in Medicare, your PSHB prescription drug coverage is automatically managed through an EGWP (Employer Group Waiver Plan), with a $2,000 annual out-of-pocket cap in 2025.

  • Broader Provider Access: With Medicare as your primary and PSHB as secondary, you often retain access to both Medicare-accepting providers and PSHB networks.

This integration is specifically designed to work with Original Medicare. Adding a Medicare Advantage plan changes the entire setup.

What Happens If You Add Medicare Advantage

Medicare Advantage plans replace Original Medicare. That means:

  • The plan becomes your primary insurance, not Medicare.

  • You’re no longer using Original Medicare, so your PSHB plan doesn’t act as a supplement to Medicare.

  • PSHB may either coordinate differently or not at all with your Medicare Advantage plan.

Depending on your PSHB plan’s terms, one of the following may happen:

  • Some PSHB plans coordinate with Medicare Advantage: They pay secondary after the Advantage plan, but often only for specific services or up to certain limits.

  • Others treat Medicare Advantage like not having Medicare at all: You may lose cost-sharing reductions, deductible waivers, or access to Medicare-integrated prescription drug benefits.

In short, adding Medicare Advantage could reduce the value of your PSHB plan or create overlaps that you still pay for but don’t use.

The Risk of Overlapping Benefits

When both your Medicare Advantage plan and PSHB cover the same types of care, such as hospital or outpatient services, you’re essentially paying for duplicate coverage. However, duplication doesn’t necessarily mean double the benefit.

Here are potential consequences of overlapping coverage:

  • Uncoordinated Claims: If the two plans don’t coordinate, one may deny a claim expecting the other to pay.

  • Paying for Coverage You Don’t Use: If Medicare Advantage covers hospital care but your PSHB plan does too, you’re paying two premiums but only using one plan’s network.

  • Provider Access Conflicts: Medicare Advantage plans may limit you to a narrower network than PSHB, overriding your wider access.

That’s why understanding how your PSHB plan works with Medicare Advantage is essential before enrolling.

The Risk of Unexpected Gaps

While overlaps are one issue, gaps are another. Some PSHB plans are not designed to supplement a Medicare Advantage plan. If your Medicare Advantage plan denies a service or doesn’t cover it fully, your PSHB plan might not pick up the difference.

In 2025, you might encounter gaps such as:

  • Limited Prescription Drug Integration: PSHB’s EGWP drug benefits only apply if you’re enrolled in Medicare Part A and B, not a separate Medicare Advantage plan with its own drug component.

  • No Deductible Waivers: Many PSHB plans waive medical deductibles only when Medicare is primary. If your Medicare Advantage plan is primary instead, this waiver may disappear.

  • Reduced Out-of-Pocket Protection: While PSHB plans offer robust cost-sharing limits when paired with Original Medicare, these limits may not apply when a Medicare Advantage plan is primary.

These gaps can lead to increased medical expenses and fewer protections.

What to Ask Before Enrolling in a Medicare Advantage Plan

If you’re considering Medicare Advantage alongside your PSHB plan, ask these questions before enrolling:

  • Does my PSHB plan coordinate with Medicare Advantage plans?

  • Will I lose any deductible reductions or copayment waivers?

  • How does prescription drug coverage change if I choose a Medicare Advantage plan?

  • Will both plans honor the same providers and hospitals?

  • Will my total costs (premium plus out-of-pocket) be higher or lower with both plans?

  • Will I still benefit from the $2,000 drug cost cap under PSHB’s EGWP in 2025?

Knowing these answers ensures you understand what you’re gaining and what you’re giving up.

Timeline and Enrollment Considerations

Your Medicare eligibility usually begins at age 65, but enrollment decisions should be timed carefully:

  • Initial Enrollment Period (IEP): Starts 3 months before your 65th birthday, includes the month of your birthday, and ends 3 months after.

  • General Enrollment Period (GEP): From January 1 to March 31 annually, if you missed IEP. Coverage starts July 1.

  • Medicare Advantage Open Enrollment: Runs from January 1 to March 31. You can switch Advantage plans or return to Original Medicare.

  • PSHB Open Season: Occurs each year from November to December. This is your chance to review and make changes to your PSHB plan.

If you’re newly eligible for Medicare, you must enroll in Part B to maintain PSHB coverage under certain conditions. Failing to enroll could result in a loss of cost-sharing benefits or even drug coverage.

If you’re already in a Medicare Advantage plan and plan to keep PSHB, you must confirm how the two plans will interact. Don’t assume they will work seamlessly.

Medicare Advantage Is Optional, But Not Always Compatible

While Medicare Advantage is optional, you must weigh its impact on your PSHB plan. In 2025, the PSHB structure expects you to coordinate with Original Medicare. Deviating from that can mean:

  • You’re paying more for less.

  • You’re limited to smaller provider networks.

  • You could lose enhanced prescription drug benefits.

If you still want the added perks that some Medicare Advantage plans advertise, ensure they don’t come at the expense of core protections you already have through PSHB.

PSHB Plans Are Built with Medicare in Mind

The 2025 PSHB program is structured specifically to complement Medicare Parts A and B:

  • Automatic Prescription Drug Enrollment: When you’re enrolled in Medicare A and B, your PSHB plan integrates an EGWP drug plan with a $2,000 cap and insulin coverage limited to $35 monthly.

  • Cost-Sharing Reductions: Medical deductibles and coinsurance may be reduced or eliminated.

  • Coverage Continuity: You maintain consistent access to nationwide provider networks without being locked into narrow Advantage plan restrictions.

When you opt for a Medicare Advantage plan, these tailored benefits may be interrupted or removed entirely.

Medicare Enrollment Affects PSHB Premiums and Benefits

Your enrollment in Medicare impacts how much you pay and what you receive from PSHB. For example:

  • Annuitants who enroll in Medicare Part B may pay lower out-of-pocket costs due to waived deductibles.

  • Failure to enroll in Part B when required may result in PSHB charging full cost-sharing rates.

Adding a Medicare Advantage plan changes the cost dynamic and may increase your overall expenses without improving access or benefits.

Making a Confident Decision in 2025

To determine whether enrolling in a Medicare Advantage plan alongside PSHB is in your best interest, you should:

Making this decision is not just about choosing more coverage. It’s about ensuring that both your PSHB and Medicare benefits work in harmony rather than at cross purposes.

Why Coordination Matters More Than Ever

As PSHB fully replaces FEHB for Postal retirees and employees in 2025, Medicare coordination becomes essential. You are no longer in a one-size-fits-all program. PSHB is tailored to support Medicare integration, especially for those who remain with Original Medicare.

Before you add a Medicare Advantage plan, pause and evaluate. Overlaps might seem like a bonus, but they can lead to redundant costs. Gaps might not be visible at first, but they can show up when you least expect them, especially in emergencies or with high-cost medications.

If you have questions about how your PSHB plan interacts with Medicare Advantage, get in touch with a licensed agent listed on this website. They can walk you through your plan’s structure, help you avoid unexpected costs, and support your long-term healthcare planning.