Medicare Part D Coverage Disclosures Due February 29th for January 1 Plan Years

Date:  February 29, 2024 – Any sized employer who sponsors a group health plan is required to notify CMS of the plan’s Medicare Part D creditable coverage status.

Who this applies to:

• Large employers with fully insured and self-funded health plans
• Small employers with fully insured and level-funded health plans

Go Deeper:
This must be done through an online form available on the CMS website. Hard copies are typically not allowed, unless the company has no internet access.

The form is relatively straightforward, but the employer needs to determine whether the prescription drug plan covers any Medicare-eligible individuals at the start of the plan year, including active employees, retirees, disabled individuals or anyone on COBRA. However, any retiree drug subsidy participants should be excluded.

Employers may not be able to give an exact number of Part D eligible individuals, but should instead estimate the number of covered Part D eligible individuals under the options offered under the type of coverage for which they are providing the Disclosure Notice to CMS. This estimate should be the total number of Medicare eligible individuals, less any Medicare eligible individuals being claimed under the retiree drug subsidy program. This includes actives, disables, individuals on COBRA, and retired individuals (best estimate of those over 65).

The Disclosure to CMS Form must be submitted annually within 60 days from the start of the plan year. Thus, for plans that begin on Jan 1, the deadline to submit the CMS disclosure is February 29, 2024. CMS must also be notified within 30 days after termination of the prescription drug plan or a change in creditable coverage status of the drug plan.

Lastly, there is no specific penalty for failure to complete the Disclosure to CMS Form, but ERISA plan fiduciaries must administer the plan in accordance with ERISA and other federal laws. Therefore, employers should determine if the plan is creditable or non-creditable, and disclose that information to CMS within the appropriate timeframes.