OPM Publishes Rule Establishing the Postal Service Health Benefits Program

Last week, the Office of Personnel Management (OPM) published its interim final rule establishing the Postal Service Health Benefits (PSHB) program, the new health benefits program specifically for postal workers and retirees. PSHB program coverage will begin in January 2025 for postal workers and annuitants. Per the rule, and as set forth in the law, postal annuitants will not be required to enroll in Medicare Part B if they have not already done so.  

Anyone who is a postal annuitant as of January 1, 2025, and not already enrolled in Medicare Part B, will not be required to enroll in Part B as a condition of receiving health benefits through the PSHB program. Any family members of such a postal annuitant are also exempt from the Part B enrollment requirement. Further, postal employees who are at least age 64 as of January 1, 2025, will not be required to enroll in Medicare Part B when they retire (as a postal annuitant) as a condition of receiving health benefits through the PSHB program. Any family members of such a postal employee are also exempt from the Part B enrollment requirement.  

Furthermore, Medicare-eligible postal annuitants and family members who are not already enrolled in Medicare Part B will have a six-month special enrollment period, beginning April 1, 2024, to enroll in Part B penalty free.  

While NARFE fought hard to maintain choice for current retirees and older employees, other stakeholders fought strongly to ensure future retirees were required to enroll in Part B. As such, current postal employees under age 64 as of January 1, 2025, will be required to enroll in Medicare Part B once both eligible for Medicare (age 65) and retired (as a postal annuitant). More information on Part B exceptions, the special enrollment period and general information about the PSHB can be found on NARFE’s factsheet here.  

Just like FEHB, the PSHB will be operated by the Office of Personnel Management (OPM), and to the greatest extent practicable, the program will offer a PSHB plan from each FEHB carrier that has a plan with 1,500 or more Postal Service employees or annuitants enrolled in 2023. OPM may exempt certain health maintenance organization (HMO) plans from this requirement, and the PSHB will be permitted to include plans offered by other carriers as deemed appropriate by OPM. PSHB plans must include self only, self plus one, and self and family plan options. 

In the initial contract year, 2025, PSHB carriers must offer plans that have coverage with equivalent benefits and cost-sharing to the FEHB plans offered by that carrier, except as needed to integrate with Medicare Part D prescription drug coverage. Part D integration will allow PSHB plans to offer similar or better prescription drug coverage while providing a source of cost savings for the PSHB plans that will help reduce premiums, all else being equal.  

Based on the interim final rule, the PSHB plan year will run from January 1 to December 31 each year starting in 2025, in contrast with the effective dates for FEHB, which begins the first day of the first pay period in the next year. OPM will create a centralized enrollment system allowing PSHB enrollees to make coverage decisions through an online portal. Persons unable to access the online portal will be able to make enrollment decisions over the phone, by fax or by mail. The interim rule also outlines important dates for the implementation of the program, such as the launch of a health benefits education program beginning October 2023, the beginning of the six-month Medicare Part B special enrollment period in April 2024, the publishing of PSHB plan rate and benefits for 2025 in September of 2024 and the first open season, running November 11 through December 9, 2024.