By Pension and Benefits Editorial Staff
Group health plan sponsors that provide prescription drug coverage to individuals eligible for Medicare Part D must disclose to the Centers for Medicare and Medicaid Services (CMS) whether the coverage is creditable or non-creditable. The disclosure obligation applies to all plan sponsors that provide prescription drug coverage, even those that do not offer prescription drug coverage to retirees. Calendar year plans must submit this disclosure to the CMS by March 1, 2019. For non-calendar year plans, the Creditable Coverage Disclosure is due to the CMS no later than 60 days after the beginning of the plan year.
Plan sponsors are required to submit the disclosure online using the Disclosure to CMS Form available on the CMS website. In preparing the disclosure to CMS, plan sponsors need to:
- Identify the number of prescription drug options they offer to Medicare-eligible individuals. This is the total number of benefit options they offer, excluding any benefit options they are claiming under the retiree drug subsidy (RDS) program (i.e., benefit options for which the plan sponsor is expected to collect the subsidy).
- Determine the number of benefit options offered that are creditable coverage and the number that are non-creditable. Note that prescription drug coverage is creditable if it is at least actuarially equivalent to Medicare Part D prescription drug coverage.
- Estimate the total number of Part D-eligible individuals expected to have coverage under the plan at the start of the plan year (or, if both creditable and non-creditable coverage options are offered, estimate the total number of Part D-eligible individuals expected to enroll in each coverage category).
A new disclosure form should be submitted to the CMS within 30 days after any change in the creditable coverage status of the prescription drug plan, or if the plan is terminated for any reason.
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