Deadline to determine creditable coverage status is Oct. 15

The deadline to determine and communicate the creditable or non-creditable status of plans for 2020 is Oct. 15, 2019.

The Medicare Modernization Act mandates that certain entities offering prescription drug coverage, including employer and union group health plan sponsors, must disclose to all Medicare-eligible individuals with prescription drug coverage under the plan whether such coverage is "creditable." Determining whether or not certain coverage is creditable is essential to an individual's decision to enroll in a Medicare Part D prescription drug plan.

To assist you in determining creditable coverage, UnitedHealthcare annually collaborates with Optum Insight to perform bulk-testing analysis of its standard benefit designs to satisfy the actuarial value test of the Medicare Part D determination.

Here’s what you need to know if you offer a prescription drug plan to Medicare-eligible individuals:

  • Optum Insight determines if your plan provides "creditable coverage" based on the results of the bulk-testing. 
  • Once the plans are tested, the data becomes available on the UnitedHealthcare Medicare Part D creditable coverage website.
  • Brokers will enter the information in the creditable coverage tool and the results will be displayed. 
  • Brokers should communicate the creditable or non-creditable status of your plan to you.
  • This determination is mandatory at least once a year and the deadline for completion is Oct. 15, 2019.
  • Employers, not UnitedHealthcare, send creditable coverage notices to members.
  • Employers can pay UnitedHealthcare to send creditable coverage notices to members on its behalf.

Retiree Drug Subsidy (RDS) program

If a plan's coverage is creditable, the plan sponsor can elect to pursue a subsidy called the Retiree Drug Subsidy program. Under the Patient Protection and Affordable Care Act (ACA), subsidy payments to plan sponsors became subject to standard tax deduction rules in 2013. This optional step requires additional testing and an application process. Plan sponsors can apply for the subsidy by going to the Centers for Medicare & Medicaid Services (CMS) RDS Website.

Plan sponsors must apply for the subsidy 90 days prior to the beginning of an RDS plan year, which can mirror a benefit plan year. If a benefit plan year begins Jan. 1, 2020 and an employer wants their RDS plan year to be the same, they would apply for the subsidy by Oct. 2, 2019. If they request an extension, CMS can grant an additional 30 days to complete the application.

Bulk testing analysis reports and more information about creditable coverage are available on UnitedHealthcare’s Medicare Part D creditable coverage website and on the CMS creditable coverage website.

The 2020 creditable coverage tool will be posted in early September. For more information, please visit the websites above or contact your UnitedHealthcare representative.

Email for assistance in locating a plan design among the plans tested or other questions concerning creditable coverage. For more information on RDS reporting for UnitedHealthcare customers, please contact Michelle Dovolos, at