CMS Updates Model Creditable Coverage Disclosure Notices
The Centers for Medicare and Medicaid Services (CMS) recently provided on its website updated Medicare Part D disclosure notices that group health plans can use to meet the annual Medicare Part D Employee Notification requirements. The revised notices, intended for use as of June 15, 2008, replace the model notices issued in 2007. While no significant changes have been made to the basic substance of the notices, content has been reorganized and more details have been added to make the notice more reader-friendly.
As a reminder, these creditable coverage disclosure notices are part of the requirements under the Medicare Prescription Drug Improvement and Modernization Act of 2003 (MMA). Under this regulation, employers and union group health plan sponsors offering prescription drug coverage are required on an annual basis to not only notify Medicare-eligible plan participants whether such coverage is “creditable,” but also disclose this information to CMS. Please note the following important details regarding these mandatory communications:
Creditable Coverage Employee Notice
The MMA regulations specify that all Medicare-eligible individuals with prescription drug coverage must be notified of their employer’s health plan status as a creditable plan. CMS believes such information is necessary to an individual’s decision to enroll in a Medicare Part D prescription drug plan.
The regulations under 42 CFR §423.56(f) specify the times when creditable coverage disclosures must be made to Part D eligible individuals. At a minimum, disclosure must be made at the following times:
- Prior to the Medicare Part D Annual Coordinated Election Period (ACEP) – Nov. 15 through Dec. 31 each year;
- Prior to an individual’s Initial Enrollment Period (IEP) for Part D, as described under 423.38(a);
- Prior to the effective date of coverage for any Medicare eligible individual that joins the plan;
- Whenever prescription drug coverage ends or changes so that it is no longer creditable or becomes creditable; and
- Upon a beneficiary’s request.
If the creditable coverage disclosure notice is provided to all plan participants, CMS will consider items 1 and 2 to be met. This guidance clarifies that “prior to” means the beneficiary must have been provided the Disclosure Notice within the past 12 months.
Creditable Coverage Disclosure to CMS
Entities that provide prescription drug coverage to Medicare Part D eligible individuals must also disclose to CMS whether the coverage is "creditable prescription drug coverage" regardless of whether the entity's coverage is primary or secondary to Medicare. This disclosure can be made using the online Creditable Coverage Disclosure Form, which can be found on the CMS website at www.cms.hhs.gov.
It should be noted that while the initial creditable coverage Disclosure to CMS Form was completed by all entities that were required to provide a disclosure by March 31, 2006, for plan years that ended in 2006, this is an annual requirement. For all subsequent plan years, the Disclosure to CMS Form is due no later than 60 days following the beginning of the entity’s plan year (renewal year, contract year, filing year, etc.).
For further information on this subject, please click here. Should you have any additional questions, please contact our office at 919-403-1986.
Please Note: If you no longer wish to receive communications of this nature from Hill, Chesson & Woody, please reply to the sender of the email with the word "unsubscribe" in the header. Thank you.
Important Notice: Hill, Chesson & Woody does not engage in the practice of law, accounting, or medicine. Therefore, the contents of this communication should not be regarded as a substitute for legal, tax, or medical advice.
July 30, 2008
Hill, Chesson & Woody Employee Benefit Services
194 Finley Golf Course Rd, Suite 200,
Chapel Hill, NC 27517
Phone: 919.403.1986
Fax: 919.913.0237
www.hcwbenefits.com