Medicare Part D: Creditable Coverage Disclosure Notices Due Before October 15
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 purpose of this notice is to help individuals make informed decisions on when to elect Medicare Part D coverage to avoid late enrollment penalties. There is no penalty on the 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 in regards to meeting the deadline as well as web links to the model notices.
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