What is the purpose of the notice?
Insured employees use this information to make an informed decision on when to enroll in Part D Prescription drug coverage.
Who should be notified?
Employees and dependents who are eligible for Medicare and enrolled in the group-sponsored prescription drug coverage.
When are the notices due?
October 15, 2021
How do I know if the group’s prescription drug plan is creditable?
Creditable coverage means that the coverage would pay as much as a standard Medicare prescription drug plan. Employers are not expected to make this determination on their own. Reach out to your broker or insurance carrier for more information.
What information needs to be included in the notices?
Sample notices are available upon request.
What if my group’s prescription drug coverage is Non-Creditable?
The Medicare Modernization Act imposes a penalty for those who do not maintain creditable coverage. From their initial enrollment until they enroll in Part D, if the policyholder has not maintained Creditable coverage for 63 days or longer, they will be subject to a penalty when they enroll in Part D.
What is the penalty amount?
For those who with Non-Creditable coverage for 63 days or more, the penalty is 1% of the average cost of the Part D premium amount times the number of full months of non-creditable coverage.