Medicare Part D Employer Notification Requirements

Savoy has prepared a sample employer education package, which you may use to communicate notification obligations to your employer plan sponsors.

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Published: 09.16.2024

The 2025 Annual Election Period (AEP) for Medicare Part D begins October 15, 2024 and ends December 7, 2024.

The Medicare Modernization Act of 2006 provides access to prescription drug coverage to all Medicare-eligible persons under Medicare Part D. Plan sponsor notice regarding the organization’s prescription benefits must be provided to any Medicare-eligible person whether due to age or disability and is required for employees, spouses, dependents, those on federal COBRA or state continuation including retirees. Notice must be provided before Open Enrollment begins.

Employees will use that information to help them formulate their personal decision of whether or not they will enroll in Medicare Part D prescription coverage outside of the employer plan. This decision is critical as penalties apply when Part D is not timely in place.

Medical insurance carriers typically notify policyholders regarding the Creditable versus Non-Creditable status of the prescription coverage plan.

Please keep in mind that this determination is the employer's responsibility when the employer is the plan sponsor. If the carrier states that the health plan is non-creditable, the benefits may still be creditable if the employer has an HRA arrangement in place. The employer would have to override the carrier notice. Therefore, it is the employer's responsibility to examine all of the benefits that are being provided to determine the creditability of the prescription coverage. The carrier is only providing notification regarding the creditability of the coverage that the carrier provides.

Savoy has prepared a sample employer education package for reviewing notification obligations to employer plan sponsors.

This package contains the following:

1. Letter from Broker Advising the Employer of Notification Responsibility
2. Medicare & You 2025 Handbook​
3. Sample Personalized Employee Letters for Notification of Creditable and Non-Creditable Coverage:
   • ​​Medicare Part D Creditable Coverage Disclosure Notice (PDF) | Medicare Part D Creditable Coverage Disclosure Notice (Word doc)
   • Medicare Part D Non-Creditable Coverage Disclosure Notice (PDF) | Medicare Part D Non-Creditable Coverage (Word doc)      

Note: The above Model Notices were issued for use on or after April 1, 2011 and are still current. Spanish versions are also available at: cms.gov/Medicare/Prescription-Drug-Coverage/CreditableCoverage/Model-Notice-Letters.html

Creditable Coverage Disclosure to Centers for Medicare and Medicaid Services (CMS) 
Most entities that currently provide prescription drug coverage to Medicare Part D eligible individuals (including employees, dependents, continuees and those eligible for Medicare due to age or disability) must disclose to CMS whether or not the coverage is a creditable prescription drug coverage. The disclosure must be provided whether the entity is primary or secondary to Medicare. Group plan sponsors must complete the Creditable Coverage Disclosure to CMS Form online: cms.gov/Medicare/Prescription-Drug-Coverage/CreditableCoverage/CCDisclosureForm.html

Annual Enrollment Period
During the Annual Election Period (AEP), those individuals enrolled in Medicare or Medicare Advantage may also make changes to various aspects of their coverage. These include the following:

• Switch from Original Medicare to Medicare Advantage, or vice versa.
• Switch from one Medicare Advantage plan to another, or from one Medicare Part D (prescription drug) plan to another.
• If they did not enroll in a Medicare Part D plan when first eligible, enroll in such a plan during the general Open Enrollment Period, although a late enrollment penalty may apply.

To enroll in a Medicare Advantage plan, some additional criteria must be satisfied:

• Must be enrolled in Medicare Part A and B.
• Must live in the plan’s service area.
• Cannot have End-Stage Renal Disease (some exceptions apply).

Medicare Advantage Open Enrollment Period (OEP)
During the OEP, which runs from January 1, 2025 through March 31, 2025, an individual enrolled in a Medicare Advantage Plan is allowed to:

• Switch from Medicare Advantage to Original Medicare, and enroll in a Medicare Part D plan; or
• Switch from one Medicare Advantage plan to another Medicare Advantage plan.

Only one “switch” is permitted during each OEP. 

Is Auto-Renewal Available?
Medicare Annual Open Enrollment for coverage beginning January 1, 2025 will run from October 15 to December 7, 2024. Individuals already enrolled in a Medicare Part D Prescription Plan or Medicare Advantage Plan, who do not want to make changes to their coverage for 2025, do not need to do anything during the AEP, assuming the current plan will still be available in 2025. If the plan is being discontinued and is not eligible for renewal, they will receive a non-renewal notice from the carrier prior to the AEP. These individuals will have an extended enrollment period (a Special Enrollment Period) through February 28, 2025.

Important Note – This Special Enrollment Period applies only to individuals whose Medicare Part D plans have non-renewed and that have not been mapped to another plan.

If you have any questions, contact your Savoy Sales Team.