Sponsors of group health plans offering prescription drug coverage must notify Medicare-eligible individuals whether their prescription drug coverage is “creditable coverage” (i.e., whether their coverage is expected to pay on average as much as the standard Medicare prescription drug coverage). This notice must be provided prior to the first day of the Medicare Part D annual election period. Historically, the annual election period has taken place from November 15 through December 31. However, starting this year, the annual election period will now take place from October 15 through December 7. As a result, group health plan sponsors will need to distribute creditable coverage notices on or before Friday, October 14, 2011.

The Centers for Medicare and Medicaid Services (CMS) has issued an updated model notice that can be used to satisfy the creditable coverage notice requirement. The model notice is available online (http://tinyurl.com/644ob5y).

Action Required by Plan Sponsors

  • Plan sponsors distributing model creditable coverage notices should use the updated CMS model notice (for use on or after April 1, 2011)
  • Plan sponsors distributing customized creditable coverage notices should update their notices to reflect the new annual election period for Medicare Part D
  • Plan sponsors should review and update their distribution procedures for creditable coverage notices to ensure compliance with the new October 14 deadline