The primary means most employers use to determine this is to ask their health insurance carrier. However, if the plan is self-insured, it is possible that the carrier will ask you to make your own determination. We are unable to provide legal guidance so we cannot determine if a plan is creditable or non-creditable. If the carrier will not provide the information, employers must make the determination. If you are unsure, it may be best for you to contact legal counsel.

Creditable: Equal to or greater than the actuarial value of defined standard Part D coverage.

Non-Creditable: Less than the actuarial value of defined standard Part D coverage.

We issue the notice(s) prior to the health plan renewal so you have time to register with CMS. The notice(s) can be distributed at any point in that plan year. However, the notice(s) must be issued prior to October 15. If issued at health plan enrollment, you have met the notice requirement as it is prior to the October 15 deadline. The notice(s) should be provided at the following times:

Prior to the start of the annual coordinated election period (ACEP) for Part D which runs October 15 through December 7;

Prior to an individual’s initial enrollment period (IEP) for Part D;

Prior to the effective date of coverage for any Part D eligible individual that enrolls in the employer’s prescription drug coverage;

Whenever the employer drops prescription drug coverage or changes its coverage so that the coverage is no longer creditable or becomes creditable; and

Upon request by the Part D eligible individual.

The first disclosure requirement is to provide a written disclosure to all Part D eligible individuals who are enrolled in or seeking to enroll in the plan whether coverage is creditable or non-creditable. This includes eligible active working individuals and their dependents, as well as Medicare eligible COBRA individuals and their dependents. We generally advise employers to provide it to all staff under the prescription drug plan, if unsure of dependent statuses. For further detail, please locate your Distribution Instructions document that was provided to you along with your Notice(s) package.

A Part D eligible individual is an individual who:

Is entitled to benefits under Medicare Part A or enrolled in Medicare Part B; and

Lives in the service area of a Part D plan.

Part D eligible individuals could include active employees, disabled employees, COBRA participants, retirees and, importantly, covered spouses and dependents of any of the above.

Here are more details to help you determine who should receive a notice:

Who Is Considered Entitled to Medicare Part A? To be entitled to Medicare Part A, individuals must have applied for and been granted coverage under Part A. Individuals who are merely eligible for Part A without being enrolled are not entitled to Part A for purposes of the Part D disclosure requirements.

Who Is Considered Enrolled in Medicare Part B? For purposes of the Part D disclosure requirements, individuals are not considered enrolled in Part B until they have applied for and been granted coverage under Part B, even though they are, for other purposes, considered enrolled in Part B once they have applied for coverage under Part B.

What Is a Part D Plan Service Area? A Part D plan service area consists of one or more regions established by CMS. These are usually, but not always, Medicare Advantage regions. Individuals who are living abroad or incarcerated are not eligible for Part D because they are not considered to be residing in the service area of a Part D plan.

Who Is Considered Enrolled or Seeking to Enroll in Coverage? Determining the employees, retirees, spouses, and dependents who are currently enrolled in an employer’s prescription drug plan should be straightforward, but determining which individuals might be seeking to enroll is more challenging. It seems reasonable to assume that the requirement to provide disclosures to Part D eligible individuals who are seeking to enroll in a plan will be satisfied if disclosures are provided to all employees (or retirees) who are eligible to enroll. For example, the requirement would seem to be satisfied if a plan’s enrollment materials include a Part D notice and those materials (including the notice) are provided on an annual basis to all employees or retirees who are eligible to enroll in the plan.

The second disclosure requirement is for employers 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 (contract year, renewal year), within 30 days after termination of a prescription drug plan, or within 30 days after any change in creditable coverage status. For further guidance, please locate your Creditable Coverage Disclosure to CMS Guidance document provided to you along with your Notice(s) package.

If an insurance company, a third party administrator, or some other third party provides the notice(s), the distribution requirement will be satisfied.

The employer needs to make sure that the insurance company (if its plan is fully-insured), or the third party administrator (if the plan is self-insured), has assumed the obligation of sending out the notice and will take responsibility if this is not done.

Alternatively, if the insurance company or third party administrator is not willing to do this, then the employer needs to send out the notice.

We do not provide the Medicare Part D notices in Spanish. However, the Spanish-language version is located on the Department of Labor website.

Yes, these plans are similar to or work in conjunction with a health plan, therefore Medicare Part D Notice(s) would be required.