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We recognize that staying informed on various compliance requirements can be challenging which is why we offer resources to assist in the process. From health care reform updates, to providing information and data needed to fulfill required notices, reporting and filing obligations, Moda is your partner. Our in-house legal and regulatory teams provide consultation for contract and policy language development. Our underwriting and actuarial teams provide rate/cost and claim impact analysis for benefit plan design options. And our account service team is readily accessible to help you navigate the compliance maze.

Creditable Coverage

Employers and unions who offer health plans with prescription drug coverage are required to disclose to all Medicare eligible individuals whether their prescription drug coverage is "creditable." The Centers for Medicare and Medicaid Services (CMS) consider prescription drug coverage creditable if the actuarial value of the coverage equals or exceeds the actuarial value of standard prescription drug coverage covered under the Medicare Part D prescription drug benefit.

What Employers Need to Do?

Entities that provide prescription drug coverage to Medicare Part D eligible individuals must disclose to CMS whether the coverage provided is "creditable prescription drug coverage." If the entity offers a prescription drug plan to Medicare eligible individuals, the following actions must be taken.

  1. Determine if the plan provides "creditable coverage."
  2. Communicate if the plan is creditable or non-creditable annually by Oct. 15th, and at various times as stated in the regulations. Visit the CMS website for guidance.
  3. Distribute the Creditable Coverage notices to members. The Centers for Medicare & Medicaid Services provide sample notices for convenience (access Model Disclosure notices here).

The employer is also required to complete the Online Disclosure to CMS Form to report the creditable coverage status of their prescription drug plan. This is done by accessing the CMS website and filing out the on-line notice to CMS located in the Disclosure section of the website. CMS requires that the disclosure be provided within:

More details and processes are provided on the CMS website.

Is my Prescription drug coverage with Moda creditable?

The following charts reflect the creditable/non-creditable status of your group sponsored prescription drug plans:

Why do employers need to send Creditable Coverage Notices?

If the prescription drug plan offered is creditable, then Medicare eligible beneficiaries will not be penalized if they choose to delay enrollment in Medicare Part D.

Medicare beneficiaries with non-creditable coverage who choose not to enroll in Medicare (medical) and Medicare Part D coverage during open enrollment (Oct. 15 through Dec. 7), may pay a penalty, in the form of a higher premium, for Medicare Part D coverage should they decide to enroll in the future. The penalty payout will last for the duration of time that the member has the Medicare drug coverage. Participants can avoid the late enrollment penalty if they buy a Medicare Part D plan within 63 days of the day creditable coverage ended.

Additional Information:

Visit the CMS website for a complete guideline regarding creditable coverage notifications and disclosures.


We have exciting news to share. ODS is changing its name to Moda Health.

Moda comes from the latin term "modus" and means "a way". We picked it because that's what we are here to do: help our communities find a way to better health.

Together, we can be more, be better.

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