Medicare: Creditable Coverage Disclosures

Creditable Coverage Disclosures

This is a reminder that Medicare Modernization Act (MMA) requires employers to provide a Medicare Part D disclosure notice to their Medicare-eligible employees by October 14th of each year. This disclosure notice is for Medicare employees regarding the credibility of the prescription drug coverage that is offered through their employer plan.

Written Disclosure Notice

The Medicare Part D benefit is an optional benefit that can be purchased by either the Medicare beneficiary or by the employer, on the beneficiary's behalf. If pharmacy benefits are covered under your client's group health plan, they must inform their Medicare-eligible employees whether the prescription coverage offered is "creditable" (equal to the standard Medicare benefit) or "non-creditable" (not equal to the standard Medicare benefit).

Employers must provide notices to their Medicare-eligible employees, dependents and retirees on the following occasions:

Prior to the Medicare Part D Annual Election Period (October 15th through December 7th each year);
Prior to the individual's initial enrollment period for Part D (within the last 12 months);
Prior to the effective date of coverage for any Medicare-eligible individual who joins the plan;
Whenever prescription drug coverage ends or changes; and
On a beneficiary's request.

Important Note: Medicare-eligible employees should keep their creditable coverage disclosure notice in case they need it for future reference. If Medicare-eligible employees become eligible for Part D and decide not to sign up because they have other coverage, a creditable coverage disclosure notice allows them to enroll in Part D at a later date without being charged a higher premium.

For individuals enrolled in a non-creditable employer health plan, failure to enroll in Part D when they are first eligible will result in them being charged a higher premium if they choose to enroll in Part D at a later date.

Online Disclosure Notice (to CMS)

Employers are also required to notify the Centers for Medicare and Medicaid Services (CMS) annually of the creditability of the prescription drug coverage provided to Medicare-eligible employees, dependents and retirees. The disclosure to CMS must occur at various times, including every year, within 60 days of the employer's health plan anniversary or when there is a change in the creditability of the prescription drug coverage.

Resources

Creditable Coverage Overview

Written Disclosure Notices

Creditable (English)
Creditable (Spanish)
Non-Creditable (English)
Non-Creditable (Spanish)

Online Disclosure Notice

CMS Online Form

CMS Online Instructions

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