Each year, all employers that offer prescription drug coverage must provide a Medicare Part D notice to all Medicare-eligible individuals—including retirees, active employees, dependents, or COBRA participants—by October 15, the start of Medicare’s open enrollment period. Most employers choose to send this notice to their entire covered population to simplify compliance. This applies to employers regardless of size, funding type, or plan design.
With the Inflation Reduction Act lowering Medicare’s out-of-pocket maximum to $2,000 in 2025 (from $8,000 in 2024), some employer plans—especially high-deductible health plans—may no longer meet the creditable standard. Further updates in 2026 may also affect determinations.
The Centers for Medicare & Medicaid Services (CMS) provides model notices (in English and Spanish). Notices can be mailed, included in enrollment packets, or sent electronically—though strict consent and access rules apply for electronic delivery. Employers must also post non-personalized electronic notices on their websites.
EMPLOYER CONSIDERATIONS
- Confirm with your insurance carrier or TPA whether your prescription drug coverage is creditable for 2025, meaning that, on average, it provides coverage as good as Medicare Part D.
- Distribute the Medicare Part D notice to participants before October 15.
- Report to CMS within 60 days of the start of your plan year (by March 1 for calendar year plans) whether coverage is creditable or not.
