Employers, take note: According to the Medicare Prescription Drug, Improvement, and Modernization Act in 2003, you are required to send Medicare Part D Notices of Creditable Coverage by October 15.
These notices detail whether your group-sponsored healthcare plan is expected to cover as much as the standard Medicare Part D plan regarding prescription drug costs. What is standard coverage under Medicare?
- Deductible: $480
- Initial coverage limit: $4,430
- Out-of-pocket threshold: $7,050
Your plan is considered “creditable” if:
- It provides coverage for brand and generic prescriptions
- It provides reasonable access to retail providers and mail order coverage
- It pays on average at least 60% of prescription drug expenses
You should supply these notices of creditable coverage to all employees who are eligible for Medicare, which would include:
- Retirees and their dependents
- Active Medicare-eligible employees and their dependents
- COBRA participants
As an alternative, you might wish to simply send the notice to all employees, either separately or as part of a packet of information on healthcare enrollment or other benefits. This can save you the trouble of determining which employees are Medicare-eligible.
If you wish to send electronic notices rather than paper copies, you need to follow several strict guidelines. We can help you understand these procedures or answer any other questions you have about Medicare Part D Notices of Creditable Coverage. Please call our office and we’ll be happy to assist you.
And remember: Notices must be sent by October 15, so the time to get started is now.