Key Takeaways

  • Medicare Supplement (Medigap) policies provide critical coverage but do not guarantee uniform protections for all postal retirees.

  • Timing, health status, and state regulations can heavily influence your access and costs under Medigap in 2025.

Understanding Medicare Supplement Basics

When you transition into retirement, especially as a postal retiree under the PSHB system, understanding your Medicare options becomes vital. Medicare Supplement plans, often called Medigap, are designed to cover some of the out-of-pocket costs that Original Medicare (Parts A and B) does not, such as deductibles, copayments, and coinsurance.

However, many postal retirees mistakenly assume that these plans are universally available, affordable, and offer identical protections everywhere. In reality, Medigap operates under a combination of federal rules and state-specific regulations, leading to significant variations in access and costs.

Limited Enrollment Windows Shape Your Options

Medicare Supplement protections are strongest during very specific enrollment periods. These periods affect your ability to buy a plan without undergoing medical underwriting, which can increase costs or lead to denial of coverage.

  • Medigap Open Enrollment Period: This six-month window starts the first month you are 65 or older and enrolled in Medicare Part B. During this time, you can buy any Medigap policy available in your state without worrying about your health status.

  • Guaranteed Issue Rights: These are special protections triggered by certain events, such as losing other coverage. However, outside of these events and your initial enrollment window, insurance companies in most states can require you to answer health questions.

If you miss your Medigap Open Enrollment or do not qualify for a Guaranteed Issue situation, you may face higher premiums, fewer options, or complete denial of coverage.

State Regulations Create an Uneven Playing Field

While Medicare is a federal program, Medigap is partially regulated by states, creating major differences in how easy it is to get coverage.

  • Some states, like New York and Connecticut, require insurers to offer Medigap plans year-round with no medical underwriting.

  • Other states have no such protections after your initial enrollment period ends.

In 2025, there is still no federal requirement mandating annual Medigap Open Enrollment Periods for all retirees. This means your ability to change Medigap plans without penalty largely depends on where you live.

Costs Are Climbing

Medigap premiums have been steadily rising year over year. As of 2025, postal retirees are seeing average annual increases of 3% to 5%, depending on plan type and region. Several factors contribute to these increases:

  • Rising healthcare costs

  • Older average age of policyholders

  • Advances in medical treatments

Importantly, premiums for Medigap plans generally increase as you age, regardless of when you first enroll. Some insurers use “attained-age” pricing, meaning your premiums will rise simply because you are getting older.

Medigap Does Not Cover Everything

Even with a Medigap policy, you will still be responsible for certain healthcare expenses. Medigap does not cover:

  • Prescription drugs (you need a separate Part D plan)

  • Routine dental, vision, or hearing care

  • Long-term care

  • Private-duty nursing

Additionally, Medigap does not include any extra benefits like gym memberships, transportation services, or over-the-counter allowances, which are sometimes advertised with other types of Medicare coverage.

Coordination with PSHB in 2025

As a postal retiree, you are now under the Postal Service Health Benefits (PSHB) Program starting in 2025. PSHB plans automatically integrate with Medicare Part A and Part B for retirees aged 65 and older.

If you decide to add a Medigap plan to your PSHB and Medicare coverage, coordination becomes complex. You must understand:

  • PSHB plans may waive certain deductibles and copays if you have Medicare Parts A and B.

  • Medigap would primarily cover gaps left by Medicare, not necessarily those created by PSHB.

Purchasing a Medigap plan on top of PSHB and Medicare may offer minimal additional benefit unless you expect extensive out-of-pocket expenses under Medicare Parts A and B alone.

Enrollment Mistakes Can Be Expensive

Missing deadlines or misunderstanding your rights can lead to:

  • Higher monthly premiums

  • Limited plan choices

  • Medical underwriting denials

Once your six-month Medigap Open Enrollment window passes, it is often difficult to secure a plan without added scrutiny. In most states, insurance companies can:

  • Deny your application

  • Impose waiting periods for pre-existing conditions

  • Charge you higher rates based on your health history

High-Deductible Medigap Plans Require Caution

In recent years, high-deductible Medigap options have become popular due to their lower initial premiums. However, you must meet a high deductible amount each year before your plan pays anything.

As of 2025, high-deductible Medigap plans have deductibles exceeding $2,800 per year. This can be risky if you experience unexpected medical events and cannot easily pay these costs out-of-pocket.

Alternatives to Traditional Medigap

Some postal retirees consider other options besides traditional Medigap coverage, such as:

  • Remaining with PSHB and Medicare Parts A and B alone

  • Using healthcare savings accounts if eligible

  • Exploring limited-benefit supplemental policies

However, these alternatives often require careful evaluation. No solution perfectly replaces the full scope of protection a traditional Medigap plan offers against Medicare cost-sharing.

How Medigap Policies Are Changing in 2025

Several updates in 2025 are impacting Medigap policies:

  • The most comprehensive plans (Plan C and Plan F) remain unavailable to those newly eligible for Medicare after January 1, 2020.

  • Some states are piloting new standardized plans aimed at simplifying coverage choices, but adoption remains uneven.

  • More Medigap insurers are introducing premium discounts for spouses or household members, but availability varies widely.

These changes make it essential to review available plan options carefully each year, especially if your health status or retirement budget changes.

Tips for Postal Retirees Considering Medigap in 2025

To make the most informed decision:

  • Start early: Review your options before your 65th birthday or retirement date.

  • Compare carefully: Check costs, benefits, and underwriting rules in your state.

  • Understand PSHB coordination: Clarify how your PSHB plan interacts with Medicare and Medigap.

  • Watch for deadlines: Do not miss your six-month open enrollment window.

  • Consult an expert: Contact a licensed insurance agent listed on this website for personalized guidance.

Planning ahead can save you thousands of dollars and ensure you have the right healthcare protection when you need it most.

Why You Need to Act Proactively in 2025

Medicare Supplement insurance remains an important financial safety net for many postal retirees, but it is not universal, automatic, or guaranteed affordable. Understanding the limitations, state rules, and coordination challenges with PSHB can help you avoid costly mistakes.

If you are approaching Medicare eligibility or thinking about changing your coverage, it is crucial to get help from a licensed insurance agent listed on this website. They can provide personalized advice based on your specific situation, health needs, and retirement goals.