What do employers need to do?
Beginning this year, all employers must notify Medicare
eligible individuals (employees, retirees, dependents,
spouses) who are enrolled in or apply for coverage in
their prescription drug benefit whether the benefit plan
provides "creditable coverage."
Notification must be done prior to November 15, 2005
and at other specified times:
-
before November 15 of each
year
-
before the individual's
initial enrollment period (age 65 or eligibility)
-
before joining the
prescription (health) plan
-
whenever prescription
coverage ends or changes "creditable" status
-
upon request
The easiest way to meet the
requirement is to notify all employees.
What is "creditable coverage"?
"Creditable coverage" provides prescription benefits that
are actuarially equivalent to Medicare Part D. With some
exceptions, most small group plans provide creditable
coverage.
How do I know if our coverage is creditable?
Carriers will be notifying benefits administrators of
creditable coverage status. There are some plans that do
not provide creditable coverage. We will also notify
employer groups that have a plan we know does not meet
creditable coverage requirements.
How do I notify employees?
Letter templates are available from our website at
http://www.shargel.com/Keeping_Current.htm. These have
been approved by the Centers for Medicare and Medicaid
Services so all you need to do is put in your company name
and send them to employees.
Why does creditable coverage matter?
It's important for employees to understand their options.
If an eligible employee chooses employer coverage that is
not creditable coverage instead of enrolling in a Part D
plan, they will be subject to higher premiums when they do
enroll.
Also, if an employee enrolls in Medicare Part D, they
may risk losing their group health coverage.
I don't have Medicare eligible employees. Do I still
need to notify my employees?
Even if you don't have Medicare eligible employees today,
it's best to notify all employees and new hires each year.
As your workforce changes, you'll have the system in
place. And you'll know you're covered.
