The Medicare Modernization Act requires employers to compare their health plan’s prescription drug benefits with the standard Medicare prescription drug benefit. Employers must notify each Medicare-eligible plan member with prescription drug coverage of the results. This notice helps members determine whether to enroll in a Medicare Part D prescription drug plan or continue the prescription drug coverage offered through their employer’s health plan.

An employer’s prescription drug coverage is considered “creditable” when its benefits are expected to pay, on average, at least as much as standard Medicare Part D coverage.

Members with creditable coverage may continue their current prescription drug coverage or enroll in a Medicare Part D prescription drug plan. Members with non-creditable coverage should consider enrolling in a Medicare Part D plan. A small group with non-creditable coverage may be able to add a health reimbursement arrangement (HRA) to make its coverage creditable.

Members who choose to enroll in a Medicare Part D prescription drug plan must do so during open enrollment, which runs through December 7 of this year.

Key Links:

• Creditable Coverage Letter
• Non-Creditable Coverage Letter
• Small Group Creditable Coverage Plan Flyer
• Choice Level Funded Creditable Coverage Plan Flyer