Compliance Alert: Determining Whether Prescription Drug Coverage Is Creditable
A group health plan’s prescription drug coverage is considered creditable if its actuarial value equals or exceeds the actuarial value of standard Medicare Part D prescription drug coverage. Prescription drug coverage that does not meet this standard is called “non-creditable.”
Employers with prescription drug coverage must determine whether their coverage is creditable.
Medicare Part D requires employers to disclose to CMS and to Medicare Part D-eligible individuals whether their prescription drug coverage is creditable.
There is no employer fee or penalty for offering prescription drug coverage that is non-creditable.
Ask the health insurance carrier (for insured coverage)
Simplified determination (for certain plan designs)