Group health plan sponsors must provide Medicare Part D “creditable coverage” notices prior to October 15th, the start date of the Medicare annual enrollment period for Part D, Prescription Drug coverage. (The enrollment period is October 15-December 7.) The Medicare Modernization Act requires group health plan sponsors that offer prescription drug coverage to notify Medicare-eligible plan participants (employees and dependents) as to whether their prescription drug coverage is “creditable coverage” – which means the coverage is expected to pay on average at least as much as the standard Medicare Part D prescription drug coverage.
The October 15th deadline applies for all group health plan sponsors who provide prescription drug coverage, regardless of plan year, plan size, employer size, employer type (private sector, governmental or church), grandfather status, or whether the plan is insured or self-funded.
You can mail the Part D notices or send them electronically to each Medicare-eligible employee who is eligible for your group health plan and to other plan participants (such as COBRA enrollees). For individuals who do not have job-related electronic access, you must either obtain their written consents to receive this Notice electronically or you must furnish them a paper copy of this Notice (you can send them by first class mail).
Although the requirement is only that “Medicare-eligible” individuals be provided this notice, employers often provide it to all plan participants and dependents, because of the practical difficulty of knowing who is Medicare-eligible.
Model Medicare Part D Notices are available on the Centers for Medicare and Medicaid Services (CMS) website. Links to all the model letters (in English and Spanish) are available here. These notices are in .pdf format.
- The Part D Notice must be provided not only to Medicare-eligible active working employees and their dependents, but also to Medicare-eligible participants who are retired, on COBRA, or disabled and covered under the employer’s prescription drug plan.
- Employers who send out Open Enrollment packets prior to October 15th often include the Medicare Part D notices in the Open Enrollment packets, to avoid the extra cost and administrative burden of sending them separately.
- Employers are alsorequired to notify CMS online annually that they have sent out these Part D notices. The notice to CMS is due within 60 days after the start of the plan year. See the last paragraph of this article for details.
- Group health plan sponsors to whom this disclosure requirement applies include employers and Unions; multiple employer welfare arrangements (MEWAs); federal, state and local government employers; and churches.
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