Leslie M. Carlet

SPHR, Benefits Expert

Blog for American Benefit Partners, Inc.

Welcome to benefits news for Group Health and Ancillary Insurance in South Florida!


Medicare Part D Annual Employer Filing 2012

October 10th, 2011

Annual Notice Action Required by October 15, 2011

Starting this year, employers must provide Medicare Part D notices prior to October 15th due to changes made as part of Health Care Reform.  If you remember in previous years, notices were required prior to November 15th.

By October 15th, you are required to give notice to employees, retirees and COBRA participants regarding the Creditability of your health plan’s Rx benefit.

Once complete, you are then required to register online with the Centers for Medicare and Medicaid Services (CMS). 

As of 2006, Medicare offers a “Part D” prescription drug benefit to eligible Medicare individuals (Medicare Beneficiaries). 

The Annual Notice:

CMS has provided sample notices for creditable coverage and non-creditable coverage disclosure notices. Plan Sponsors must determine whether the prescription drug benefit they offer is considered creditable or not creditable, and distribute the appropriate notice by October 15th each year, and whenever plans change during the year.  Each Plan Sponsor will need to add specific content to these notices.  Please refer to the links above for Sample Notices.

In general, if your plan has a 3-tier drug copay, your plan is Creditable.  If your drug benefit is subject to a deductible, i.e. HSA plan, or your drug benefit has an annual benefit limit, your plan is Non-Creditable.  But, check with your health insurance carrier to determine the creditability of your plan(s).

How to provide notice to members of your plan:

1. Plan Sponsors have the option of using the sample notices or producing their own notices which contain all of the necessary elements, as described in the updated guidance. This guidance is available on the CMS website:  www.cms.gov

2. Delivering the Notice by Mail.  Plan Sponsors may mail the notice as a stand alone mailing or choose to incorporate the notice into other documents or disclosures, so long as there is prominent first-page, 14-point reference to the incorporated notice language. 

 3. Electronic Delivery.  Plan Sponsors may also deliver the notice electronically to plan participants who have the ability to access the Plan Sponsor’s electronic information system on a daily basis as a part of their work duties. Plan Sponsors should inform participants that they are to share the electronic notice with all family members who are covered under the group health plan.

 4. Recipients.  Plan Sponsors should provide the notice to all health plan participants including COBRA beneficiaries. As we stated above, Plan Sponsors need only to provide a single notice to a participant with covered dependents, unless the sponsor records contain a separate address for other family members.   Our attorney recommends that you distribute the notice to every enrolled participant, regardless of age, in the event someone has a Medicare-eligible dependent

5. The Deadline.  October 15, 2011.  Medicare beneficiaries begin an open enrollment period on that date. To assist them in electing prescription drug coverage, they must know the status (creditable / non-creditable) of their current coverage. This requirement applies whether the plan coverage is primary or secondary. 

If for some reason, a Plan Sponsor does not meet this deadline, it is critical to distribute the notice as soon as possible thereafter.

For a more detailed discussion of the Medicare Part-D notice and coverage requirements, and to download all notices and to file, go to the CMS website: http://www.cms.hhs.gov

Annual Notice Instructions 

  1. Download the Sample CREDITABLE and/or NON-CREDITABLE notice, whichever applies, and customize to your organization. 
  2. Distribute to all employees by October 15th.  You may have one plan that is Creditable and one that is not, and therefore, need to download both forms.  Distribute to employees depending on the plan in which they are enrolled.
  3. Click on the “Disclosure to CMS Form” link and complete the form by October 15th.  When asked about the number that will be eligible for Medicare Part D, just estimate 1 or 2, unless you are certain there is no one eligible.  When hiring someone new, include the notice in the New Hire packet.  Also, send the attached notice to all enrolled employees each time you change plans or carriers, and prior to October 15th each year.
  4. Print copies of everything and keep in a file year-to-year.

Healthcare Reform Update – March 2010

March 24th, 2010

The House passed the Senate’s Healthcare Reform Bill (see below for highlights) on Sunday, and the President signed it into law on Monday. The House then passed a companion bill that would bring changes to the Senate bill.  Some of these changes include:

More subsidies for lower income individuals and families to help purchase health insurance.
A push back from 2014 to 2018 on the tax to be imposed on expensive “Cadillac” health insurance plans; the premium level establishing a plan as a “Cadillac” plan has been increased, as well.

The slow reduction of the Medicare Prescription Drug benefit “donut hole” beginning this year; seniors who hit this gap in 2010 would receive $250 to offset costs.

A cut of $200 billion in subsidies that go to insurers who offer private alternatives to Medicare.

An increase in Medicaid payments to doctors to align with Medicare rates to help ensure there will be enough doctors to handle the newly insured.

An increase to the Medicare tax for individuals earning over $200,000 and couples earning over $250,000 annually. This tax would also apply to investment earnings such as dividends.

Removal of the, “Cornhusker Kickback” provision that has angered many.

An additional tax for taxpayers with adjusted income more than $200,000 ($250,000 for joint filers) of 3.8% tax on net investment income (such as interest, dividends, capital gains).

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More Employers Offering Wellness Plans

March 15th, 2010

Leslie M. Carlet was featured in the South Florida Business Journal with her take on the effect of health care increases in the small to middle group market.

More Employers Offering Wellness Programs-March 5, 2010

COBRA Subsidy Extended

March 15th, 2010

As you may know Congress extended the COBRA Premium Reduction Subsidy an additional 31 days through the end of March. This means that anyone terminated involuntarily through 3/31/2010 could be eligible for the COBRA Premium Reduction Subsidy (if they also meet a few other qualifiers). We are in the process of having our legal team update our notices to reflect the recent legislative changes, and will be sending out COBRA Election Notices for anyone terminated 3/1 or after once we have the updated notices back from legal.

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Healthcare Reform Update

January 12th, 2010

As many of you are aware, the House and the Senate have each passed their own Healthcare Reform bills. Their next goal is to combine these two bills into one final bill that will pass.

Each bill includes many provisions, including what entity will regulate insurers, what type of sanctions may be imposed, what requirements employers will face, what minimum benefits health plans must include, and individual coverage mandates.  Below is a brief review of some of the more employer-related aspects of the two bills and how they compare.  This is by far not a comprehensive summary, just bullet points to cover some areas of interest.

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COBRA Premium Subsidy Now Reality

February 23rd, 2009

The Law
Employers / Plan Sponsors who are subject to state or federal COBRA must provide premium subsidies of no less than 65% of regular COBRA premium to “Assistance Eligible Individuals” beginning March 1, 2009. Employers must provide notice of the subsidy’s availability to all eligible individuals within 60 days of the law’s enactment.

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Medicare Part D

November 10th, 2008

Important Information:

It’s that time of year again! By November 15th, you are required to give notice to employees, retirees and COBRA participants regarding the Creditability of your health plan’s Rx benefit.

Once complete, you then are required to register online with the Centers for Medicare and Medicaid Services (CMS). As of 2006, Medicare offers a Part D prescription drug benefit to eligible Medicare individuals (Medicare Beneficiaries).

The following link to our documentation, created by our ERISA attorney, explains these regulation. This is only for your reading pleasure. For our current clients, we will email you the specific steps for your organization.

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