In preparation for the Medicare fall open enrollment period, employers that sponsor group health plans that include prescription drug coverage are required to notify all Medicare-eligible individuals whether such coverage is creditable.
This year, plan sponsors must provide the annual disclosure notice to Medicare-eligible individuals by October 14, 2016.
The creditable coverage disclosure notice must be provided to Medicare Part D eligible individuals who are covered by, or who apply for, the health plan’s prescription drug coverage. However, to simplify this task, many group health plan sponsors provide the creditable coverage disclosure notices to all plan participants.
CMS has provided two model notices that may be used by employers:
- A Model Creditable Coverage Disclosure Notice for when the health plan’s prescription drug coverage is creditable
- A Model Non-creditable Coverage Disclosure Notice for when the health plan’s prescription drug coverage is not creditable
Delivery Methods for the Notices
Plan sponsors do have some flexibility on how they may distribute these notices. Here is an overview of some key options:
- Distributed separately: Many organizations choose to distribute this notice by itself in hardcopy format.
- Distributed with other materials: Some organizations provide the notices with their annual open enrollment materials, such as in a booklet. In that case, the notice must be prominent and conspicuous. In fact, specific guidelines are provided that detail the font size that should be used as well how the location of the notice should be referenced. (Please download the Compliance Bulletin referenced below for more information.)
- Distributed electronically: A plan sponsor may provide the notice electronically to plan participants who have the ability to access electronic documents at their regular place of work, if they have access to the sponsor’s electronic information system on a daily basis as part of their work duties.
Disclosure to CMS
As a reminder, plan sponsors are also required to disclose to CMS whether their prescription drug coverage is creditable. The disclosure must be made to CMS on an annual basis.
Primarily, this disclosure is done within 60 days after the beginning date of the plan year for which the entity is providing the form.
I hope that you find this overview helpful. For additional details, I encourage all clients to log-in to the CBGconnect portal today to download the Compliance Bulletin on this topic.
If you have any questions about how CBG Benefits can help you meet this compliance requirement, please contact our team at 781-759-1222.