Don’t Let the Two Major Postal Health Plan Changes Confuse You
written by Lacie Harmon exclusively for © Postal Employees Network
9/5/24 – If you’re a postal employee or retiree (annuitant), you would be forgiven for having some confusion about the Post Office Health Plan switchover from the Federal Employee Health Benefit (FEHB) to the Postal Service Health Benefits Program (PSHB). The change is a massive and complicated affair, and while the USPS and OPM are doing everything they can to make the upcoming transition smooth, quite a few folks have mentioned to my office that they aren’t quite sure what’s going on. One question that comes up more than any other right now:
“Does this change affect me?”
Actually, there are two answers. That’s because there are two major transitions with two separate deadlines at play right now. Let’s take a look at what they are:
1. If you’re a Post Office employee or annuitant, you will need to transition to the PSHB during Open Season (Nov. 11 – Dec. 9, 2024).
The PSHB is the new group health plan exclusive to USPS employees and annuitants, currently provisionally comprised of 32 plans similar to plans previously offered under FEHB. This split of the USPS from all other federal employees/annuitants is a legal requirement resulting from the passage of the Postal Service Reform Act of 2022, and it affects everyone, regardless of age or employment status.
In terms of what you need to do, there’s good news: in many cases, you won’t need to do anything. This is because in cases where the PSHB offers a plan similar to your FEHB plan, the USPS will send you a letter in late October showing the new plan into which the USPS intends to “crosswalk” you. When you receive the letter, if you agree with it, you just do nothing. But, in cases where there isn’t a roughly equivalent option available, you can shop for a plan that meets your needs. The USPS will send plan details by mail once they’re available.
2. If you’re a Post Office retiree, you may have the opportunity to sign up for Medicare Part B penalty-free during the Special Enrollment Period (SEP) taking place April 1 – September 30, 2024. This change is an option but is not required.
Generally speaking, folks who don’t sign up for Medicare Part B when they turn 65 or retire, whichever is later, incur a 10% penalty for every year they wait beyond that window of opportunity, should they decide to enroll at a later date.
But, because Medicare Part B has never been a requirement for USPS retirees to keep their Post Office health plan (though it will be required for almost all new retirees as of Jan. 1, 2025), many USPS retirees never took advantage of Medicare Part B when they initially had the chance.
This is why, as an incentive to bring more folks into Medicare, the USPS is offering to pay penalties on behalf of those who enroll late. If you’re eligible for this, you should have received a letter from the USPS in March letting you know.
There are a few reasons why you might consider taking advantage of the SEP offer. For one thing, when combining Medicare Part B with your Post Office health insurance, OPM says your Post Office plan will often “waive its copayments, coinsurance, and deductibles for Part B services.” Also, some of the carriers are currently offering to reimburse you for some or all of your Part B monthly premium ($177/mth. for most people). And finally, Medicare Part B often has stronger coverage for “durable medical goods” than the Post Office health plan (i.e., wheelchairs, oxygen tanks, hospital beds in the home). So, particularly for folks who have health issues and visit the doctor often, there can end up being a cost savings for taking Medicare Part B.
With regard to the PSHB plans, the USPS reports new plan details will be available as of September 15, and they’ll be sent out via hard mail in the weeks that follow. Details will also be offered on a new PSHB centralized online system available in late October, and enrollment in the new plans will be available on that site.
Navigating these changes may seem daunting but keep an eye out for the upcoming USPS mail communications, and you’ll do just fine. If you have questions about your own situation, resources for getting those answered are below. Remember, health coverage is an essential part of your retirement security so it’s worth choosing wisely. Here’s hoping this information makes your decisions a bit easier.
RESOURCES:
PSHB webinars every 2 weeks until December 5th are available: https://www.keepingposted.org/pshb-lunch-learn-seminars.htm.
For questions about the PSHB transition or Medicare SEP, you can call 813-712-7742 or email retirementbenefits@usps.gov.
Lacie Harmon is a Federal Benefits and Retirement Specialist who helps federal employees understand and maximize their benefits, both during employment and retirement years. She teaches regularly at federal agencies and offers monthly federal retirement webinars. Past classes taught include for clients such as the FAA, USDA and GAO, as well as union locals of the APWU and NALC. Web: https://www.lacieharmon.com | Facebook | Email: LHarmon@thefederalbenefitsgroup.com
Warm Regards,
Lacie
Lacie Harmon
818-370-6490
Benefits/Retirement Counselor
The Federal Benefits Group
P.S. Thinking about retiring in the next 5 years? Click here to set time for a complimentary Retirement Income Review with me.
PEN Notice: Please use the contact information for Lacie above if you have questions or, visit her website www.lacieharmon.com.
My husband who was a postal retiree died in July. I got a notice by email in mid Dec that I was transferred over to the postal & it sounded like I still had blue cross. Today I get a notice I don’t have any health insurance anymore (except for my medicare) but the government is still taking out insurance from my annuity according to my notice. Now what? I don’t have any insurance??
Mrs. Norton – Sorry to hear about your problem. Our website is not affiliated with USPS except provide postal news to employees and retirees. However, I am certain that you MUST contact OPM (Office of Personnel Management) – OPM administers annuity payments for retired postal employees. Access the following link or use the phone number below. Wish you luck.
OPM Phone 202-606-1800
Mailing Address
U.S. Office of Personnel Management
1900 E Street, NW
Washington, DC 20415-1000
Right now everything that could go wrong with this PSHB plan, has gone wrong with my situation. Retiree with Postal, took the SEP for Medicare B, that was confirmed, signed up with a Medicare C Advantage Program, suspended my PSHB and that was finally confirmed. What happened to us, our current health plan enrolled us on 1 Dec, not with our approval or knowledge, into Plan D. That caused my wife and I to be kicked out of our Medicare C plan. Our current health plans refused to take us out, says they need confirmation from our “employer” before we can cancel. We received letters today from our current health plan, stating that they did get a letter BUT we are NOT cancelled our of THEIR plan until 28 Feb 2025 and the Part D they put is in will expire 28 Feb25. I have made too many calls to them to count them all, but they will not bend on this because they stated that they received this information from OPM! Our Medicare Advantage Plan is ‘holding’ our enrollment for 1/2025 but after 31 Dec 24, we are no longer in their Advantage Plan. So I will have no insurance. I also see after checking my annuity check amount for 2Jan25, that my Fed Dental and Fed Vision is still going to be taken out of my check. Those were also cancelled and I have letters from both of these groups, stating we have been cancelled in those, I am SOOOO frustrated with this, we spend every day on the phone with Medicare, OPM, Health Partners (current health ins.) etc. We spend at least 6-8 hours on the phone, me on my cell trying to get ahold of people and my wife on her cell talking to someone else about this. I have called the PSHP Navigator, and you get a recording to call OPM. Seems like the PSHP Navigator is not taking phone calls. I need help and I need it now. Thought about going to the IG,
Hi Tim – don’t know what to tell you. This change is a disaster for many. Maybe get in touch with your congressman or senator’s office. Rick @ PEN
The Postal Service assured that the PSHB MWDP part D would have the same coverage as FEHB drug plan. Not true. A drug that was covered for most of 2024 isn’t even in the formulary anymore. Premiums go up but coverage goes down. And if I want to continue taking this medication it will be $1000s per month out of pocket. How is that similar to what I had?
The way this is laid out, and haven been misled by the USPS so many times, especially during this NPR garbage, it is no wonder that all of this is so confusing. We already have doubts about anything the USPS puts out. It begs the question, “Who can we trust and where can we get an honest explanation of what is happening to us. As far as I’m concern, I would rather stay with my Blue Cross insurance. But the way this is being presented to us, we have no choice!
I’m not surprise that the USPS is doing this. It is par for the course!! Shame on them all!!
Lou – it is a shame – BUT, USPS did not write the Postal Reform Act – the current WH admin wrote it, and all of the unions praised it.