Creditable coverage

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By Oct. 15 (beginning of the annual Medicare coordinated election period), groups that offer prescription drug coverage to employees or retirees should notify their members of the creditable coverage status of their plan and of possible penalties for late enrollment in Medicare Part D (if their current coverage is not creditable).

As defined by the Centers for Medicare & Medicaid Services, coverage is considered creditable if its actuarial value equals or exceeds the actuarial value of standard prescription drug coverage under the Medicare prescription drug benefit.

The Medicare Modernization Act imposes a late enrollment penalty on individuals who do not maintain creditable coverage for a period of 63 days or longer following their initial enrollment period for the Medicare prescription drug benefit.

Which prescription drug coverage is creditable to Medicare Part D?

The following chart reflects the creditable/non-creditable status of plans:

• 2025 creditable coverage status of prescription drug plans for Oregon-domiciled and Washington-domiciled employer groups (PDF)
• For 2025 creditable coverage status of prescription drug plans for ASO employer groups, please talk to your ASO Sales Account Manager.
• 2024 Creditable coverage status of prescription drug plans for Oregon-domiciled and Washington-domiciled employer groups (PDF)
• For 2024 Creditable coverage status of prescription drug plans for ASO employer groups, please talk to your ASO Sales Account Manager.

How should I notify employees of the creditable coverage status of their prescription drug plan?

The Centers for Medicare & Medicaid Services provide sample notices for your convenience:

• Model beneficiary creditable coverage disclosure (PDF)
• Model beneficiary creditable coverage disclosure - Spanish (PDF)
• Model beneficiary non-creditable coverage disclosure (PDF)
• Model beneficiary non-creditable coverage disclosure - Spanish (PDF)

Learn more 

For more information, refer to the question and answer document and/or visit the Centers for Medicare & Medicaid Services website.