Each year, Medicare Part D requires group health plan sponsors to disclose to individuals who are eligible for Medicare Part D and to the Centers for Medicare and Medicaid Services (CMS) whether the health plan’s prescription drug coverage is creditable. Plan sponsors must provide the annual disclosure notice to Medicare-eligible individuals before October 15, 2019.
What is this notice?
This notice is important because Medicare beneficiaries who are not covered by creditable prescription drug coverage and do not enroll in Medicare Part D when first eligible will likely pay higher premiums if they enroll at a later date. Although there are no specific penalties associated with this notice requirement, failing to provide the notice may be detrimental to employees.
What do employers need to do?
Employers should confirm whether their health plans’ prescription drug coverage is creditable or non-creditable and prepare to send their Medicare Part D disclosure notices before October 15, 2019. To make the process easier, employers often include Medicare Part D notices in open enrollment packets.
Resources
CMS has provided model disclosure notices for employers to use. Employers are not required to use the model notices from CMS. However, if the model language is not used, a plan sponsor’s notices must include certain information, including a disclosure about whether the plan’s coverage is creditable and explanations of the meaning of creditable coverage and why creditable coverage is important.
Clients of AJM Associates
Every group client of AJM Associates receives a customized Employee Enrollment Guide inclusive of the Annual Required Notices each plan year. This includes the CMS Medicare Part D disclosure to ensure compliance.
Not a client of AJM Associates? Give us a call to discuss how we make compliance easy for your organization.