top of page

Compliance Corner

Welcome to Novo Connection's Compliance Corner, where transparency meets expertise in your new benefit program. We understand the evolving nature of compliance and how it can quickly become complex. At Novo Connection, our commitment to transparency ensures that you receive accurate and actionable information. Our webpage serves as a reliable resource for groups and advisors, offering insights, updates, and solutions tailored to navigate new compliance laws effortlessly.

Medicare Part D: Disclosure Notice to CMS

February 2025

Employers with health plans that provide prescription drug coverage to individuals who are eligible for Medicare Part D are subject to certain disclosure requirements. One of these requirements provides that plan sponsors must disclose to the Centers for Medicare and Medicaid Services (CMS) on an annual basis and at other select times, whether the plan’s prescription drug coverage is creditable or non-creditable.

 

This disclosure is required regardless of whether the health plan’s coverage is primary or secondary to Medicare. Plan sponsors are required to use the online form on the CMS Creditable Coverage webpage to make this disclosure.

 

The plan sponsor must complete the online disclosure within 60 days after the beginning of the plan year. For calendar year health plans, the deadline for the annual online disclosure is March 1 (Feb. 29 for leap years).

Links & Resources

Employers that are required to report to CMS should work with their advisors to determine whether their prescription drug coverage is creditable or non-creditable.


For more information, employers should also visit CMS’ Creditable Coverage webpage, which includes links to the online disclosure form and related instructions.

Annual Disclosure
  • Each year, employers with health plans that provide prescription drug coverage to Medicare-eligible individuals must disclose to CMS whether that coverage is creditable or non-creditable.

  • The annual disclosure must be provided within 60 days after the start of the plan year.​

​

Creditable Coverage
  • A group health plan’s prescription drug coverage is considered creditable if it is at least as generous as Medicare Part D prescription drug coverage.

  • There are two permissible methods to determine whether coverage is creditable—a simplified determination method and an actuarial determination method.

​​

Disclosure to CMS

Group health plan sponsors are required to disclose to CMS whether their prescription drug coverage is creditable or non- creditable. This disclosure is required regardless of whether the health plan’s coverage is primary or secondary to Medicare.
If an employer’s group health plan does not offer prescription drug benefits to any Medicare Part D eligible individuals as of the beginning of the plan year, the group health plan is not required to submit the online disclosure form to CMS for that plan year.


Also, a plan sponsor who has been approved for the retiree drug subsidy is exempt from filing the CMS disclosure notice with respect to those qualified covered retirees for whom the sponsor is claiming the subsidy.


The disclosure must be made to CMS on an annual basis and whenever any change occurs that affects whether the coverage is creditable. More specifically, the Medicare Part D disclosure notice must be provided within the following time frames:

  • Within 60 days after the beginning date of the plan year for which the entity is providing the disclosure to CMS;

  • Within 30 days after the termination of a plan’s prescription drug coverage; and

  • Within 30 days after any change in the plan’s creditable coverage status.

​​

Online Disclosure Method

Plan sponsors are required to use the online disclosure form on the CMS Creditable Coverage webpage. This is the sole method for compliance with the disclosure requirement, unless the entity does not have Internet access.
 
The disclosure form lists the required data fields that must be completed in order to generate the disclosure notice to CMS, such as types of coverage, number of options offered, creditable coverage status, period covered by the disclosure notice, number of Part D-eligible individuals covered, date the creditable coverage disclosure notice is provided to Part D-eligible individuals, and change in creditable coverage status. CMS has also provided instructions for detailed descriptions of these data fields and guidance on how to complete the form.

bottom of page