- GHP Responsible Reporting Entities (RREs) will be required to report prescription drug coverage information beginning January 1, 2020. While such reporting already exists, this information request is expanded and will include additional questions.
- For insured plans, the RRE is the insurer unless a TPA is used to process claims – in that case the TPA would be the RRE.
- For self-funded plans, the RRE is the TPA.
- For employers that are self-funded and self-administer their plan without a TPA, the employer would be the RRE.
CMS recently issued guidance and issued supporting revisions to the Medicare Secondary Payer (MSP) User Guide explaining that RREs have the option to submit this additional mandatory expanded information as part of their already mandatory MSP reporting. Plans and plan sponsors already must provide CMS creditable coverage reporting for prescription drug coverage available to Medicare-eligible employees. This reporting helps Medicare determine who pays primary where Medicare and private insurance coordinates. While this information is now mandatory beginning January 1, 2020, most employers would not be deemed an RRE. However, they should work with the insurers and PBMs to provide them the information needed to complete this reporting.
Question 1: What prescription drug coverage data must be reported under the SUPPORT Act?
Answer 1: The SUPPORT Act requires reporting for Medicare beneficiaries who have prescription drug coverage other than or in addition to Medicare Part D, which is primary to Medicare. This includes prescription drug coverage for someone who may be Medicare eligible and currently is employed or is the spouse or family member of a worker who is covered by a prescription drug plan. RREs are not to report coverage information on Medicare Part D Plans. More information on reporting requirements, data elements, and Medicare Secondary Payer (MSP) situations can be found in the Section 111 GHP User Guide.
Question 2: When are RREs required to begin reporting primary prescription drug coverage?
Answer 2: The SUPPORT Act requires RREs to begin reporting primary prescription drug coverage effective January 1, 2020. If an RRE is scheduled to report on January 26, 2020, it will need to include applicable primary prescription drug coverage information that is in effect/active for Medicare beneficiaries on or after January 1, 2020.
Question 3: In the case of reporting primary prescription drug coverage, which entity will be considered the RRE?
Answer 3: The entity considered to be the RRE for the purpose of reporting primary prescription drug coverage will depend on how the plan sponsor structures its contracts for medical, hospital, and prescription drug coverage. It should not be assumed that the RRE will be the entity that has direct responsibility of processing and paying the prescription drug claims.
For example, if the plan sponsor contracts with a GHP for hospital, medical and prescription drug coverage, then the GHP is considered the RRE and will be required to report primary prescription drug coverage. In this case, it does not matter whether the GHP administers the prescription drug coverage directly or contracts administration of prescription drug coverage to a third party such as a Pharmacy Benefit Manager (PBM). However, if the plan sponsor contracts with a GHP for medical and or hospital coverage, but then independently contracts with another third party such as a PBM to administer prescription drug coverage, then that third party or PBM is considered the RRE.
Question 4: What method will RREs be required to use to report primary prescription drug coverage information?
Answer 4: The MSP Input File is the data set used to report GHP coverage information to Medicare. All GHP RREs must submit an MSP Input File to comply with Section 111 reporting requirements. The MSP Input File allows for the reporting of medical and hospital coverage along with the reporting of primary prescription drug coverage. The necessary fields for prescription drug insurance coverage already exist on this file format and no changes will be needed to accommodate the reporting required for the SUPPORT Act. Full details on the MSP Input File can be located in the Section 111 GHP User Guide.
For full details, see CMS site on Mandatory MSP Reporting.
Pre-Existing Rules for Medicare Part D Prescription Drug Notice of Creditable Coverage
There are two types of separate MSP reporting conducted throughout the year: Notice to Employees (Medicare Part D Creditable/Non-creditable coverage notice) AND Reporting to CMS of this creditable status of the prescription drug plan offered by the plan sponsor/employer. Each requirement has different timeframes for compliance. Pay close attention to the timing variation in the full details provided below.
Notice to Employees
Employers must distribute notices of the “Creditability Status” of their Prescription Drug plans to each employee who is both:
- Covered under the employer-sponsored medical plan, and
- Eligible for Medicare
The notice also must be distributed to each employee who has a covered dependent who meets the above criteria. This includes not only individuals age 65 or older, but also individuals (dependents) who have received Social Security or Railroad Disability benefits for over 24 months, and individuals with End Stage Renal Disease. It is recommended that employers provide the notice to all plan participants to ensure compliance with the notice requirement.
In general, a prescription drug plan is “Creditable” if it provides benefits that are as good as or better than those provided by Medicare Part D Standard benefits. Separate Prescription Drug plans normally provide Creditable Coverage provided they pay on average at least 60% of an individual’s prescription drug expenses. When a prescription drug plan is integrated with a medical plan’s other benefits (i.e., with a common deductible and coinsurance), the prescription drug plan will not be “Creditable” if the combined annual deductible is over $250.
Content of Notices
- To assist employers with providing Notice of Creditable Coverage, CMS has developed model notices that may be obtained on its website: http://www.cms.gov/Medicare/Prescription-Drug-Coverage/CreditableCoverage/Model-Notice-Letters.html . (We have also attached these notices to this reminder email)
Timing / Delivery of Notices
Notice of Creditable Coverage must be provided to Medicare-eligible individuals:
- Prior to October 15
- Prior to an individual’s “initial enrollment period” in Medicare Part D;
- Prior to the effective date of an individual’s enrollment in prescription drug coverage;
- Upon termination of prescription drug coverage or upon any change that affects whether the coverage is creditable; and
- Upon request by the individual.
With respect to the manner in which notices are provided, CMS has indicated that employers may:
- Include the notice with other plan information (e.g., open enrollment materials);
- If the notices are included as a part of a larger booklet of benefits information, a reference to the section containing the notice must be on the first page, and the reference must be in a box using 14 point bold font that is offset;
- Provide a single notice to the Medicare-eligible individual and covered spouse and/or dependents; however, a separate notice must be provided if the employer has knowledge of separate residences; and
- Provide electronic notices if the individual has indicated to the employer that he or she has adequate access to electronic information and has been informed of:
- His or her right to a paper version;
- How to withdraw his or her consent to receive notices electronically;
- How to update address information; and
- Any hardware or software requirements necessary to access and retain the notice.
Notice to CMS
In addition to providing notice to Medicare-eligible individuals, employers must provide notice to CMS:
- Within 60 days after the beginning of each plan year,
- Within 30 days after a change in the “Creditability Status” of any plan, and
- Within 30 days after the termination of any prescription drug plan.
The only way to provide notice to the CMS is by completing the disclosure form on the CMS Creditable Coverage Disclosure Web page at: http://www.cms.gov/Medicare/Prescription-Drug-Coverage/CreditableCoverage/CCDisclosure.html
Employers Required Action for Creditable Coverage Reporting
- Determine whether their prescription drug coverage is “creditable”;
- Prepare Notice of Creditable Coverage, using either the CMS model notice or drafting one which satisfied CMS requirements;
- Decide whether to mail Notices to all plan participants or restrict the mailing to Medicare-eligible employees, retirees and covered dependents; and
- Provide notice, either by mail, hand-delivery or electronically, before October 15 (at open enrollment any time before this date is acceptable).
- Reporting to CMS.
- For more detailed information about Medicare plans that offer prescription drug coverage you can visit medicare.gov for personalized help.
Action Required for the New 2020 RRE Reporting
Plan sponsors should work with their carriers and PBMs to determine who will be responsible for reporting.