Notice of Creditable Coverage
Last Updated on November 22, 2022 / Benefits & Compensation
Question:
My husband just received a “Notice of Creditable Coverage” at home from his employer. As a Human Resources professional, I’m not sure what this is and I am wondering if I am supposed to be distributing something to my employees?
Answer:
Yes! The Medicare Modernization Act requires entities, employers with prescription drug coverage, to notify Medicare eligible policyholders annually as to whether their prescription drug coverage is creditable coverage. Basically, we must tell those covered if the company plan is “as good as” the standard Medicare prescription drug coverage. There are two disclosure requirements:
- The first disclosure requirement is to provide a written disclosure notice to all Medicare eligible individuals annually who are covered under its prescription drug plan, prior to October 15th each year. There are other times when notification is necessary (such as upon joining the plan) but the 10/15 deadline is important because open enrollment begins for Medicare eligible individuals.
- The second disclosure requirement is for entities to complete the Online Disclosure to CMS Form to report the creditable coverage status of their prescription drug plan. The Disclosure should be completed annually no later than 60 days from the beginning of a plan year.
For sample, creditable coverage notices and model language, refer to the Centers for Medicare & Medicaid Services.
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