Medicare Part D requires group health plan sponsors to disclose to individuals who are eligible for Medicare Part D and to the Centers for Medicare and Medicaid Services (CMS) whether the health plan’s prescription drug coverage is creditable. Plan sponsors must provide the annual disclosure notice to Medicare eligible individuals before Oct. 15, 2023 — the start date of the annual enrollment period for Medicare Part D. Although there are no specific penalties associated with this notice requirement, failing to provide the notice may be detrimental to employees.
Diversified Group can only certify Medicare D creditability using the CMS Simplified Test. However, many plans that would fail the Simplified Test may pass with an actuarial evaluation. If a plan deemed not creditable based on the Simplified Test wishes to have an actuarial evaluation to assess creditability, Diversified Group has arranged for actuarial testing with The Milliman Group. The cost of the testing is $1,900 per plan testing. If you wish to have one or more plans tested, please reach out to your Account Executive as plans will be forwarded to Milliman for testing shortly.
Notices will be sent out directly to participants from plan sponsors who have elected on their Administrative Services Agreement to have special notices handled by Diversified Group. If you need a copy of the Medicare D notice, please contact your Account Executive prior to October 15th.
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. An individual is eligible for Medicare Part D if he or she:
- Is entitled to Medicare Part A or is enrolled in Medicare Part B; and
- Lives in the service area of a Medicare Part D plan.
In general, an individual becomes entitled to Medicare Part A when he or she actually has Part A coverage, and not simply when he or she is first eligible. Medicare Part D-eligible individuals may include active employees, disabled employees, COBRA participants and retirees, as well as their covered spouses and dependents. Typically, in practice, group health plan sponsors often provide the creditable coverage disclosure notices to all plan participants.