Key Takeaways

  • If you’re a Postal Service employee or retiree currently enrolled in an FEHB plan, your coverage will transition automatically to a corresponding PSHB plan in 2025—unless you take action during Open Season.

  • Medicare-eligible annuitants may have additional requirements tied to Part B enrollment to maintain full PSHB benefits, so it’s essential to understand what’s expected based on your status.

Understanding the Transition from FEHB to PSHB in 2025

The Postal Service Health Benefits (PSHB) Program officially replaces the Federal Employees Health Benefits (FEHB) Program for Postal Service employees, retirees, and their eligible family members starting in 2025. This change is the result of the Postal Service Reform Act of 2022, which required the establishment of a new health benefits program tailored specifically for the Postal workforce.

Beginning January 1, 2025, FEHB coverage no longer applies to USPS workers and annuitants. Instead, you’ll receive health benefits through a PSHB plan. The switch is designed to provide more tailored coverage while also aligning with Medicare for eligible retirees.

Will You Be Automatically Enrolled in a PSHB Plan?

Yes—automatic enrollment applies in most cases. Here’s how it works:

  • If you’re actively enrolled in an FEHB plan as a USPS employee or annuitant, you’ll be automatically moved to a corresponding PSHB plan starting January 1, 2025.

  • The automatic transition ensures no break in coverage.

  • You’ll receive a notification from OPM before Open Season, letting you know which PSHB plan you’ll be enrolled in if you take no action.

However, automatic enrollment does not mean you’re locked in. During the 2024 Open Season (which ran from November to December), you had the option to select a different PSHB plan if the default wasn’t right for your situation.

What Happens If You’re Retired?

If you’re a Postal Service annuitant, the rules depend partly on your Medicare eligibility status:

  • Medicare-eligible retirees and their family members must enroll in Medicare Part B to maintain PSHB coverage, unless they meet certain exemption criteria.

  • If you retired on or before January 1, 2025 and weren’t enrolled in Part B, you are exempt from this requirement and may keep your PSHB plan without enrolling.

  • Those who are not yet eligible for Medicare will not be required to enroll in Part B until they become eligible.

Medicare Part B Enrollment: Mandatory or Not?

This is one of the most important changes for Medicare-eligible annuitants.

Who Must Enroll in Medicare Part B?

  • You must enroll in Part B to maintain full PSHB benefits if you turn 65 on or after January 1, 2025, and are Medicare-eligible.

  • Family members of Medicare-eligible annuitants are also subject to the Part B requirement if they qualify for Medicare.

Who Is Exempt?

  • Annuitants who retired on or before January 1, 2025, and were not enrolled in Medicare Part B.

  • Individuals living overseas or those who receive healthcare through the Department of Veterans Affairs or Indian Health Services.

Failing to enroll in Part B when required could result in a loss of drug coverage under PSHB and may limit your ability to re-enroll in the future.

How Drug Coverage Will Work in 2025

PSHB plans automatically include prescription drug coverage for Medicare-eligible annuitants through an Employer Group Waiver Plan (EGWP), which falls under Medicare Part D.

Key points to know:

  • You do not need to enroll separately in a standalone Medicare Part D plan.

  • Drug coverage is integrated with your PSHB plan.

  • There is a $2,000 annual out-of-pocket cap for prescription drug costs starting in 2025.

  • A monthly payment option is available to help spread prescription expenses across the calendar year.

How Costs Might Change

While the government still pays roughly 70% of your premium costs, you might notice some changes in your contribution amounts. These may vary depending on whether you are an employee or annuitant and which PSHB plan you are auto-enrolled in—or choose during Open Season.

Expect the following general trends:

  • Premium increases are typical, though not universal.

  • Cost-sharing structures (deductibles, copayments, coinsurance) may differ from your FEHB plan.

  • Plans coordinated with Medicare may offer reduced or waived deductibles, lower copays, and additional savings.

Using Your Online Portals: Where to Review or Make Changes

Depending on your status, you’ll use different portals to manage your PSHB plan:

  • Active Employees: Use LiteBlue to review your enrollment, premiums, and make plan changes during Open Season.

  • Annuitants: Use KeepingPosted.org to manage your PSHB plan, including coverage verification and eligibility updates.

Open Season generally runs from early November to early December each year. Outside of this timeframe, you can only change plans if you experience a Qualifying Life Event (QLE).

What About Other Federal Benefits?

PSHB replaces FEHB only. Your other federal benefits remain intact:

  • FEDVIP (Federal Dental and Vision Insurance Program) continues without change.

  • FEGLI (Federal Employees’ Group Life Insurance) is unaffected.

  • FLTCIP (Federal Long-Term Care Insurance Program) and FSAFEDS (Flexible Spending Accounts) continue as separate programs.

What You Should Do Now

As of 2025, the transition has already occurred. However, there are a few steps you can take to make sure you’re aligned with your healthcare needs:

  • Confirm your PSHB enrollment by checking your respective portal.

  • Verify Medicare Part B enrollment if you’re Medicare-eligible and not exempt.

  • Review your PSHB plan’s benefits and costs to determine if the automatic enrollment meets your healthcare needs.

  • Mark your calendar for the next Open Season to explore other PSHB plan options if needed.

How to Get More Help

Understanding the switch from FEHB to PSHB can be confusing, especially if you’re juggling Medicare enrollment or considering plan changes. If you’re unsure of your options or obligations, support is available.

You can:

  • Contact the PSHB Navigator Help Line for personalized assistance.

  • Visit the OPM website for plan brochures, coverage comparisons, and FAQs.

  • Speak with a licensed agent listed on this website to get advice tailored to your unique situation.

Staying Informed and Prepared

The PSHB transition represents a major shift in how healthcare is administered for USPS employees and retirees. While automatic enrollment helps reduce confusion, it doesn’t replace the importance of active engagement.

By staying informed, reviewing your plan options, and verifying Medicare status, you’re better positioned to manage your benefits without surprises.

Speak With a Licensed Agent if You Have Questions

Whether you’re already enrolled or still figuring out how PSHB fits into your long-term retirement planning, take time to understand what this change means for you. Don’t wait until the next Open Season to make adjustments if something doesn’t feel right.

To get the clearest picture of your options, speak with a licensed agent listed on this website for professional support.