Medicare Creditable and Non-Creditable Coverage Notices

Employers with group health plans offering prescription drug coverage must provide Medicare Creditable Coverage and/or Non-Creditable coverage notices each year in September and no later than October 15th (or at least once in every 12-month period, especially if there is a change in plans or carriers).  These notices must be provided to all Medicare-eligible employees and dependents on the employer’s health plan(s), including covered retirees, disabled individuals, and COBRA participants.  [Managed Benefits recommends employers provide the appropriate notice to all employees on the health plan(s) to ensure that all eligible persons receive it.]

These notices inform employees that effective October 15th, open enrollment begins for Medicare Part D. They also let employees covered on the employer’s medical plan(s) know whether their coverage is creditable. Prescription drug coverage is creditable if the actuarial value of the coverage equals or exceeds the actuarial value of standard prescription drug coverage under Medicare Part D – on average, at least 72% of participants’ prescription drug expenses. [This is an increase from the current simplified methodology’s 60% requirement.] By informing individuals about their coverage status, the employer allows them to avoid a late enrollment penalty if the drug coverage is non-creditable and they don’t enroll in a Part D plan.

Notices can be found at:
https://www.cms.gov/medicare/employers-plan-sponsors/creditable-coverage/model-notice-letters

Model Notice Letters | CMS
Creditable Coverage model notice lettersCreditable Coverage Model Notice Letters Entities that provide prescription drug coverage to Medicare Part D eligible individuals must notify these individuals whether the drug coverage they have is creditable or non-creditable. Entities may modify the Model Disclosure Notices provided on this page under “Downloads” to notify affected individuals whether their drug coverage is creditable or non-creditable.
www.cms.gov

Employers are also required to disclose creditable coverage status online annually no later than 60 days from the beginning of a plan year (or within 30 days after any change in creditable coverage status) at:
https://www.cms.gov/Medicare/Prescription-Drug-Coverage/CreditableCoverage/CCDisclosureForm.html

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