Coinsurance Isn’t a Straight Percentage—Here’s How It Sneaks Up Under Certain PSHB Plans

Key Takeaways

• Coinsurance under PSHB may sound like a simple percentage, but the actual cost to you depends on timing, network status, and how much of your deductible you’ve already met.

• The unpredictability of coinsurance in 2025 PSHB plans can lead to significantly higher out-of-pocket expenses, especially for hospital stays, specialty services, and out-of-network care.

Why PSHB Coinsurance Isn’t as Predictable as It Seems

When you’re reviewing your 2025 Postal Service Health Benefits (PSHB) plan, it’s tempting to think of coinsurance as a fixed percentage of costs after your deductible. But if you’re a USPS employee, retiree, or annuitant, there’s more to the story. Coinsurance percentages may look neat on paper, but your actual costs can change depending on a range of behind-the-scenes factors.

To truly understand what you’ll pay for services under your PSHB plan, you need to look beyond the percentage. Let’s walk through how coinsurance works in practice, and how it can result in surprise bills even when you think you’re covered.

What Coinsurance Means in PSHB Plans

Coinsurance is the portion of covered medical expenses you’re responsible for after you’ve met your deductible. In PSHB plans, this typically applies to more significant services such as:

• Inpatient hospital care

• Specialist visits

• Diagnostic imaging (MRI, CT scans)

• Outpatient surgery

• Emergency room care

Coinsurance rates under PSHB plans generally range between 10% and 30% for in-network services, but out-of-network coinsurance can jump to 40% or even 50%.

However, a 20% coinsurance rate does not always translate to “20% of what the provider charges.” Here’s why.

1. Coinsurance Applies After the Deductible

In 2025, most PSHB plans still require you to meet an annual deductible before coinsurance kicks in. For example:

• In-network deductibles range from $350 to $500 in lower-cost plans

• High-deductible health plans (HDHPs) can have deductibles between $1,500 and $2,000

Until you meet this deductible, you’re generally responsible for 100% of covered costs. Once the deductible is met, coinsurance begins, meaning you’ll pay a percentage of the plan-approved amount.

So if your plan says it covers 80% of the cost after your deductible, your 20% coinsurance starts after you’ve already paid $500 or more out-of-pocket.

2. The Plan-Approved Amount Isn’t Always Clear

Your 20% coinsurance is calculated based on the plan’s negotiated rate with the provider, not the provider’s actual charge. For in-network providers, this amount is pre-agreed and typically lower than the full charge. But out-of-network providers aren’t bound by this agreement.

That means:

• You may pay 20% of a lower in-network rate

• Or you could pay 40% or 50% of an inflated out-of-network rate

Worse, out-of-network providers can balance bill you for the difference between what your plan pays and what they charge. This cost isn’t limited by your out-of-pocket maximum in some PSHB plans.

3. Facility Type and Setting Affects the Price

Coinsurance isn’t consistent across all settings. Even if you receive the same treatment, where you get it matters. For example:

• In-network hospital: 20% coinsurance

• In-network outpatient facility: 10% coinsurance

• Out-of-network emergency room: 50% coinsurance

Two identical services can result in drastically different out-of-pocket costs simply based on the location of service. This is especially relevant for urgent care and emergency room visits.

4. Coinsurance Is Not Flat Across All Services

Unlike copayments, coinsurance percentages vary by service type in many PSHB plans. Here’s how this can break down:

• Primary care: May have a $20–$40 copay instead of coinsurance

• Specialist: 20% or more coinsurance

• Hospital inpatient stay: 20% of total negotiated cost per day

• Durable medical equipment: 30% coinsurance

This service-specific variation makes it difficult to predict what you’ll pay, even if you know your plan’s general coinsurance rate.

5. You May Face Coinsurance and a Copayment

In some situations, you may owe a flat copay plus coinsurance. For example, certain outpatient procedures may require:

• A $75 copay

• Plus 20% coinsurance on the remaining allowed charges

If you haven’t budgeted for both, this can come as a surprise. Always review your plan’s Summary of Benefits to see when coinsurance and copays stack together.

6. Out-of-Pocket Maximums Still Leave Gaps

All PSHB plans have a yearly out-of-pocket maximum that caps how much you pay in deductibles, coinsurance, and copays. For 2025, those limits are:

• $7,500 for Self Only plans

• $15,000 for Self Plus One and Self & Family plans

However, these caps may not include:

• Out-of-network charges

• Balance billing from non-participating providers

• Services not covered by your plan

So even if you hit your out-of-pocket limit, certain coinsurance-related costs might still fall on you.

7. medicare Eligibility Can Change How Coinsurance Works

If you’re a Medicare-eligible PSHB annuitant and enrolled in Medicare Part B, many PSHB plans offer enhanced benefits. These may include:

• Reduced or waived coinsurance for in-network services

• Lower or no deductible requirements

• Coordination with Medicare to limit out-of-pocket expenses

In contrast, if you’re eligible for Medicare but choose not to enroll in Part B, your PSHB coinsurance responsibilities may increase substantially.

The PSHB program requires certain Medicare-eligible annuitants and family members to be enrolled in Medicare Part B starting 2025 to retain full plan coverage. Failing to meet this requirement could result in higher coinsurance or loss of benefits altogether.

8. Prescription Drug Coinsurance Is Tier-Based

Coinsurance for prescription drugs is also less predictable in 2025. PSHB plans that integrate with Medicare Part D now include an annual out-of-pocket cap of $2,000. However, your share of costs until that point depends on the drug tier:

• Tier 1 (generics): Usually a flat copay

• Tier 2 (preferred brand): Could be 15% coinsurance

• Tier 3 (non-preferred): Often 25% or higher

• Specialty drugs: May reach 33%

If you’re on a high-cost medication, coinsurance adds up quickly, even with the cap in place.

9. Network Disruption Can Trigger Unexpected Coinsurance

PSHB plans may change their provider networks annually. If your preferred provider is suddenly out-of-network in 2025, you might face:

• Higher coinsurance rates

• Deductibles that don’t carry over to the out-of-network tier

• Uncapped charges due to balance billing

Always review your plan’s network directory during Open Season to avoid being blindsided by network shifts that increase your coinsurance costs.

10. Preventive Care Is the Exception

One area where coinsurance is usually not a factor is preventive care. Under most PSHB plans in 2025, preventive services like:

• Annual wellness visits

• Immunizations

• Screening tests (e.g., mammograms, colonoscopies)

are covered at 100% when delivered by an in-network provider. However, if your provider bills the visit as diagnostic instead of preventive, coinsurance may apply.

You can limit your exposure to surprise coinsurance by:

• Confirming preventive status before your visit

• Staying in-network

• Asking your provider to code services appropriately

Final Thoughts on Controlling Your Coinsurance Exposure

In 2025, PSHB coinsurance is more than just a percentage. It can fluctuate based on provider network, service type, deductible status, Medicare enrollment, and even billing codes. If you’re not paying close attention, coinsurance can quietly become one of the most expensive parts of your health care.

To protect yourself:

• Review your plan’s Summary of Benefits and Coverage (SBC) every year

• Confirm in-network status before receiving care

• Track your deductible and out-of-pocket maximum

• Coordinate with Medicare if eligible

• Speak with a licensed agent listed on this website to walk through your options and estimate your true costs

Understanding the fine print today can save you thousands tomorrow.