Reminder: Medicare Part D Notice Due Before October 15
In preparation for the Medicare fall open enrollment period, employers sponsoring group health plans that include prescription drug coverage are required to notify all Medicare-eligible individuals whether such coverage is creditable (i.e., that the coverage is expected to pay, on average, as much as the standard Medicare prescription drug coverage).
Medicare Compliance for Employers
Due to the Medicare Modernization Act, employers who provide prescription drug coverage to Medicare-eligible individuals must complete the Online Disclosure Form to the U.S. Centers for Medicare & Medicaid Services (CMS) to report whether such coverage is creditable prescription drug coverage. Creditable coverage means that the coverage is expected to pay, on average, as much as the standard Medicare prescription drug coverage. This disclosure must be completed within 60 days from your group plans’ renewal date.
If you have any of the following individuals on your health plan:
Medicare eligible active working individuals and their dependents (including a Medicare eligible individual when he or she joins the plan)
Medicare eligible COBRA individuals and their dependents
Medicare eligible disabled individuals covered under your employer’s prescription drug plan
Any retirees and their dependents
then you are required to do two things:
Disclose the creditable status of all prescription drug plans to those Medicare-eligible individuals and
Disclose to CMS the status of all plans offered to those individuals and when the individuals will be apprised of their plan status.
If you have Medicare-eligible individuals or employees who’ve already turned 65 but are still on your group plan, you must disclose to those individuals once per calendar year which plans have a creditable prescription drug component and which plans do not. This notice must be given to Medicare-eligible employees and their dependents prior to Medicare open enrollment, which is October 15th each year. If you have such employees, further down are links to model notice forms to give to those Medicare-eligible individuals. These model notices are customizable and can be filled out by the employer for the Medicare-eligible individual to retain to prove they had creditable Rx drug coverage so the employee doesn’t get penalized (1% of premium per month) if they do decide to take a Medicare Part D plan in the future.
Written Disclosure to Individuals
This written disclosure notice must be provided annually, prior to October 15, and at various other times as required under the law, to the following individuals:
Medicare-eligible active working individuals and their dependents;
Medicare-eligible COBRA individuals and their dependents;
Medicare-eligible disabled individuals covered under an employer’s prescription drug plan; and
Any retirees and their dependents.
Model notices are available from the Centers for Medicare & Medicaid Services (CMS).
Online Disclosure to CMS Also Required
Additionally, employers are required to complete an online disclosure to CMS to report the creditable coverage status of their prescription drug plans. This disclosure is also required annually, no later than 60 days from the beginning of a plan year, and at certain other times.