Creditable Coverage Notice Requirement under Medicare Part D Prescription Drug Benefit Program


If you haven’t been providing this notice to your Medicare eligible employees, it’s time to start. Section 101 of the Medicare Modernization Act of 2003 (MMA) established a notice requirement under the Medicare Prescription Drug Benefit Program (Part D). Effective in 2005, the regulations have required that individuals eligible to enroll in the Part D drug program (i.e., those entitled to Medicare Part A or enrolled in Medicare Part B) must be informed whether their current prescription drug coverage offered through their employer or union affiliation is at least “actuarially equivalent” to the Medicare Part D drug benefit. The notice is intended to assist these individuals in evaluating their options for Medicare prescription drug coverage, including the decision whether to enroll in Part D or to defer enrollment.

The notice must also be given to those individuals who qualify for Medicare because of a disability, those over age 65 and their Medicare-eligible spouses (enrolled in the employer/union plan) and dependents of retirees in employer-sponsored group health plans.

The notice can be delivered either electronically, or with other materials as Summary Plan Descriptions and notices provided at Open Enrollment. The timing of the delivery must be before open enrollment for Medicare, which begins October 15 each year.

As a client of GPA, we can assist you with this by posting the notice on EaseCentral, including the notice in your annual open enrollment booklet or assisting you in distributing the notice during open enrollment as a paper document.

For a model employee notice detailing whether your company offers creditable or non-creditable coverage, please click here. For more information regarding all of the employer requirements regarding the regulations, please click here.