Medicare Part D Notices Are Due Before October 15, 2019
Employers who sponsor group health plans must notify Medicare-eligible plan participants whether a plan’s prescription drug coverage is creditable, i.e., pays on average as much as standard Medicare Part D prescription drug coverage. This disclosure is due annually before October 15th as well as other times throughout the year. The Centers for Medicare & Medicaid Service (CMS) provides two model notices for employers to customize and distribute – one for plans with creditable coverage and the other for plans with non-creditable coverage. The notice is important because Medicare beneficiaries who are not covered by creditable prescription drug coverage and do not enroll in Medicare Part D when first eligible may pay higher premiums if they enroll at a later date.
For employers that offer more than group health plan with prescription drug benefits, the creditable coverage test should be applied to each plan separately. In addition, there is no penalty to an employer for providing non-creditable coverage.
What Employers Need to Know
Employers should contact their insurers, third-party administrators (TPA) or pharmacy benefit managers (PBM) for information regarding creditable coverage status. A simplified determination method may also be used. Where the simplified determination method is not applicable an actuarial determination should be made.
As a general recommendation and since it can be difficult for employers to identify all Medicare-eligible individuals and beneficiaries, the notice(s) should be provided to all plan participants. There is flexibility in form and manner of disclosure notices. The disclosure notices can be provided with enrollment/renewal materials. Disclosure may also be provided electronically in accordance with Department of Labor electronic delivery requirements.
Click here for additional information regarding meeting the deadline as well as web links to the model notices.
Cobbs Allen is a national independent agency focused on risk management in niche practice groups. We deliver commercial insurance, employee benefits, personal insurance, and alternative risk financing services to our clients. Headquartered in Birmingham, AL, the firm is ranked in the top 100 of privately held brokerage firms and the top 100 of all U.S. brokerage firms.
115 Office Park Drive
Birmingham, AL 35223
305 S 5th Street
Gadsden, AL 35901
2121 Sage Road
Houston, TX 77056
Kansas City, MO. 64111
New Orleans, LA 70112