Employers Must Notify Medicare Eligible Employees and CMS of “Creditable Coverage” by October 15, 2023

If you offer medical insurance to your employees and any of them are eligible to enroll in Medicare (typically age 65+) then you must send notices to the employee and complete an online form with the Centers for Medicare and Medicaid Services (CMS).

The law requires that employers tell Medicare-eligible employees whether the prescription medicine coverage that they have through the employer-sponsored plan has “creditable coverage.”  Creditable coverage means that the benefits of their company plan will pay out as much as standard Medicare prescription drug coverage pays.

Medicare Part D covers prescription medication. The government wants to prevent people from not having sufficient coverage while employed and enrolling in Medicare later and paying the same amount as someone who had the minimum level of coverage since their original eligibility for Medicare.

Most employer-sponsored medical insurance plans meet the requirements for minimum coverage.  However, some HSA-Compatible plans don’t meet the minimum requirements.  HSA, or Health Savings Account plans have high deductibles that apply to prescription medicine and that may make the coverage “non-credible”.  Each year, insurance companies create a list of plans that are non-credible and you should check the list to determine whether the coverage for your Medicare-eligible enrollees is credible or non-credible.

An employer must also log into this page on the CMS.gov website and notify CMS about their plans and employees who are impacted.  Employers must complete the notifications by October 15th . Employers must complete these notifications each year or whenever there is a plan change that affects coverage credibility.

If your current broker, agent or other employee benefits professional is not assisting you with this, please contact us, at Benefits Cafe (800) 746-0045 and we can become the agent on your employer-sponsored plans and assist you with completing this government requirement.

Tags: Small business medical insurance, Medicare