AEP-Important Info about Creditable Coverage Letters

Part D Creditable Coverage Letter

Requirements for Employers

Reminder: In addition, employers must file a Creditable Coverage Disclosure Notice with CMS at the Department of Health and Human Services within 60 days of the beginning date of the Plan Year, or within 30 days of a change or termination of the Prescription Drug Plan. The notification can be completed online at the CMS website. If you haven’t done this in the current calendar year yet but your group medical renewal has been finalized, we urge you to do so now.

Is your Prescription Coverage Creditable for Part D deferral?

All employers that provide prescription drug coverage to employees and their dependents eligible for Medicare Part D, are required to notify those individuals whether or not the coverage that is provided, is creditable, as part of the Medicare Part D creditable coverage requirements.

Notices must be provided to Medicare-eligible active working individuals and their dependents, Medicare-eligible COBRA individuals and their dependents, Medicare-eligible disabled individuals covered under the prescription drug plan, and any retirees and their dependents who are covered under the plan.
Employer groups required to supply the notices to their participants include, but are not limited to, private employers, federal, state, county, and local governments, collectively bargained plans, and church plans. Since you may not know if any of your employees have dependents who are on Medicare or are Medicare eligible, we at HTA strongly recommend you send the notice to all your employees.

For your convenience, we have provided you with the appropriate model notice. You will need to fill in your group name, the name of your health insurance company, and contact information where indicated. The Model language for these notices was obtained from the Centers for Medicare & Medicaid Services (CMS) website.

When are Notices Due?

These notices must be provided annually by October 14, (prior to the October 15th to December 7th election period for Medicare Part D); prior to an individual’s initial enrollment period for Medicare Part D (the employer is considered compliant if a notice is sent to all plan participants annually); prior to the effective date of coverage for any Medicare Part D eligible individual who enrolls in the employer’s prescription drug coverage; if the employer no longer offers prescription drug coverage, or changes it, so it is no longer creditable or it becomes creditable; and upon request by any Medicare Part D-eligible individual.

What is Creditable Coverage?

Creditable means the coverage is expected to pay on average as much as the standard Medicare prescription drug coverage. Medicare-eligible individuals need to know if their employer plan is creditable so they can decide whether to enroll in a Medicare Part D prescription drug plan. Any employer that does not qualify for the safe harbor benefit design, must determine whether their plan is at least as good as the Medicare prescription drug plan. Employers may want to have an actuary make this determination to ensure that it is accurate.

CMS has not issued guidance on how this earlier disclosure requirement should be applied if the employer has not yet determined what prescription drug coverage it will offer in the upcoming year. We recommend that employers use their current prescription drug coverage for the credibility test, and then issue a new notice if the creditability changes for the new plan year.

How Must the Notices be Delivered?

Delivery of the notice can be made on a stand-alone basis, or combined with other documents. However, if combined, the notice must be prominent and conspicuous in at least 14-point font and placed in a separate box. A single notice can be mailed to the employee and dependents, unless the employer is aware that the spouse or dependent is Medicare Part D eligible and resides at a different address. First class mail is preferable and the employer should document when the notice is mailed, where it is mailed, and to whom it is mailed. Electronic mailings can be made only to plan participants who have the ability to access the plan sponsor’s electronic information system on a daily basis, as part of their work duties. If sent electronically, the employer must inform plan participants that they are responsible for providing a copy to their Medicare-eligible dependents covered under the group health plan. The employer also must post a copy on the company’s website.

For more information about creditable coverage, please contact our employer services team at HTA at 610-430-6650, option 3 or kbretzel@htafinancial.com Other reference sources: Medicare at 1-800-633-4227 or www.medicare.gov or the website for The Center for Medicare Services (CMS) at www.cms.hhs.gov/CreditableCoverage.

Who can use HTA Services During AEP?

Who HTA can help…

Anyone who is doing their initial OnBoarding into Medicare–This is what we do best and we love helping people figure out the maze of Medicare

Anyone who is enrolled in at least one type of insurance through HTA–If you already enrolled through HTA we offer a VIP service every year to help you shop your coverages to make sure you always are enrolled in your most suitable option.

Who HTA is unable help…

As much as we want to help everyone that is seeking guidence, we simply don’t have the capacity. We have to put our existing clients first. If you are already enrolled through HTA or is coming into Medicare for the first time, we got your back.

Anyone who is already enrolled in a Medicare Advantage Plan or Medicare Prescription Drug plan through another insurance representative–In an effort to be helpful to others, we have created our Non Client AEP Page to answer your most frequently asked questions and provides videos to guide you through the process.

Who needs to take action during AEP? - 1m 46s

Who needs to take action during AEP?

Unless you are ALREADY ENROLLED in a Medicare Advantage or Medicare Prescription Drug Plan, you DO NOT have to take any action during AEP.

The deadlines ONLY pertain to those that are ALREADY ENROLLED in a Medicare Advantage or Medicare Prescription Drug Plan and want to make changes.