Employers have an annual obligation to issue a creditable or non-creditable coverage notice to all health plan participants who are Medicare-eligible, including dependents and retirees. The notice, due by October 15, informs Medicare-eligible participants whether their prescription drug coverage is at least as good as Medicare.
Should a prescription drug plan provide benefits that are less than Medicare offers, the coverage is deemed non-creditable. Medicare-eligible plan members with non-creditable coverage would be advised to enroll in a Medicare Part D prescription drug plan to avoid penalties at a future enrollment date.
Notices can be distributed by first-class mail, hand-delivered or emailed if recipients have access to the employer’s email system as part of their daily work duties. The email should note that the notice should be shared with all Medicare-eligible individuals under the group health plan.
Model notices are available to download from the Centers for Medicare and Medicaid Services. Most fully insured prescription drug plans are creditable. If you are unsure which notice to use, please check with your Bukaty Companies benefits consultant.
Download a customizable creditable coverage disclosure notice.
Download a customizable non-creditable coverage disclosure notice.
Online disclosure also required
An online disclosure requires employers to verify whether their company’s prescription drug coverage is creditable or non-creditable as defined by CMS. The disclosure requirement must be completed no later than 60 days after the beginning of a plan year. This is an annual requirement.
For additional information, contact your Bukaty benefits consultant at 913.345.0440.