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New I-9 for 2020

February 03 - Posted at 2:23 PM Tagged: ,

On Jan. 31, 2020, USCIS published the Form I-9 Federal Register notice announcing a new version of Form I-9, Employment Eligibility Verification, that the Office of Management and Budget approved on Oct. 21, 2019. This new version contains minor changes to the form and its instructions. Employers should begin using this updated form as of Jan. 31, 2020.

The notice provides employers additional time to make necessary updates and adjust their business processes. Employers may continue using the prior version of the form (Rev. 07/17/2017 N) until April 30, 2020. After that date, they can only use the new form with the 10/21/2019 version date. The version date is located in the lower left corner of the form.

USCIS made the following changes to the form and its instructions:


Revised the Country of Issuance field in Section 1 and the Issuing Authority field (when selecting a foreign passport) in Section 2 to add Eswatini and Macedonia, North per those countries’ recent name changes. (Note: This change is only visible when completing the fillable Form I-9 on a computer.)


  • Clarified who can act as an authorized representative on behalf of an employer
  • Updated USCIS website addresses
  • Provided clarifications on acceptable documents for Form I-9
  • Updated the process for requesting paper Forms I-9
  • Updated the DHS Privacy Notice

A revised Spanish version of Form I-9 with a version date of 10/21/2019 is available for use in Puerto Rico only.


Redesigned IRS Form W-4 for 2020

January 06 - Posted at 10:24 AM Tagged: , , , ,

The IRS has substantially redesigned the Form W-4 to be used beginning in 2020.

All new employees first paid wages during 2020 must use the new redesigned Form W-4.  In addition, employees who worked for an employer before 2020 but are rehired during 2020 also must use the redesigned 2020 Form W-4.

Continuing employees who provided a Form W-4 before 2020 do not have to furnish the new Form W-4.  However, if a continuing employee who wants to adjust his/her withholding must use the redesigned Form.

IRS FAQs for Employers

The IRS has issued the following FAQs for employers about the redesigned 2020 Form W-4:

Are all employees required to furnish a new Form W-4?
No, employees who have furnished Form W-4 in any year before 2020 do not have to furnish a new form merely because of the redesign. Employers will continue to compute withholding based on the information from the employee’s most recently furnished Form W-4.

Are new employees first paid after 2019 required to use the redesigned form?
Yes, all new employees first paid after 2019 must use the redesigned form. Similarly, any other employee who wishes to adjust their withholding must use the redesigned form.

How do I treat new employees first paid after 2019 who do not furnish a Form W-4?
New employees first paid after 2019 who fail to furnish a Form W-4 will be treated as a single filer with no other adjustments.  This means that a single filer’s standard deduction with no other entries will be taken into account in determining withholding.  This treatment also generally applies to employees who previously worked for you who were rehired in 2020 and did not furnish a new Form W-4.

What about employees paid before 2020 who want to adjust withholding from their pay dated January 1, 2020, or later?
Employees must use the redesigned 2020 form.

May I ask all of my employees paid before 2020 to furnish new Forms W-4 using the redesigned version of the form?
Yes, you may ask, but as part of the request you should explain:
    »   they do not have to furnish a new Form W-4, and
    »   if they do not furnish a new Form W-4, withholding will continue based on a valid form previously furnished.

For those employees who furnished forms before 2020 and who do not furnish a new one after 2019, you must continue to withhold based on the forms previously furnished.  You may not treat employees as failing to furnish Forms W-4 if they don’t furnish a new Form W-4. Note that special rules apply to Forms W-4 claiming exemption from withholding.

Will there still be an adjustment for nonresident aliens?
Yes, the IRS will provide instructions in the 2020 Publication 15-T, Federal Income Tax Withholding Methods, on the additional amounts that should be added to wages to determine withholding for nonresident aliens. And nonresident alien employees should continue to follow the special instructions in Notice 1392 when completing their Forms W-4.

When can we start using the new 2020 Form W-4?
The new 2020 Form W-4 can be used with respect to wages to be paid in 2020.


Reminder: OSHA 300A Logs Must Be Posted By Feb 1st

January 03 - Posted at 9:00 AM Tagged: ,
All OSHA 300A logs must be posted by February 1st in a visible location for employees to read. The logs need to remain posted through April 30th.

Please note the 300 logs must be completed for your records only as well. Be sure to not post the 300 log as it contains employee details.
The 300A log is a summary of all workplace injuries and does not contain employee specific details. The 300A log is the only log that should be posted for employee viewing.

Please contact our office if you need a copy of either the OSHA 300 or 300A logs.

Florida’s Minimum Wage Increased as of January 1, 2020

January 02 - Posted at 10:00 AM Tagged: ,

Florida raised its minimum wage to $8.56 an hour beginning Jan. 1, 2020, up 10 cents from $8.46 in 2019. For tipped employees, the minimum wage will be at least $5.54 an hour.

The minimum wage rate is recalculated each year on Sept. 30, based on the Consumer Price Index. 

Employer found liable for intentionally violating minimum wage requirements are subject to a fine of $1000 per violation, payable to the state in addition to potential civil action law suit. 

Be sure to update your required Florida Minimum Wage Posting to reflect this change. You can download a copy of the new poster here.

Earlier this week, the IRS issued Notice 2019-63, which extends both: (1) the filing deadline for Forms 1095-C and 1095-B; and (2) the good-faith reporting relief.  But this year, there’s more.  In limited circumstances, the IRS will not penalize entities for the failure to furnish information to individuals using Form 1095-B, and in some cases, Form 1095-C (see discussion of Section 6055 Relief below).

 Deadline Extension

Notice 2019-63 extends the due date for reporting entities to furnish 2019 Forms 1095-C and 1095-B to individuals from January 31, 2020 to March 2, 2020.  These forms must also be filed with the IRS (along with the applicable transmittal statement) by February 28, 2020 (if filed on paper) or March 31, 2020 (if filed electronically).  Reporting entities may, however, request individual extensions to file these forms with the IRS.

Good-Faith Reporting Relief

The IRS may impose penalties of up to $270 per form for failing to furnish an accurate Form 1095-C or 1095-B to an individual and $270 per form for failing to file an accurate Form 1095-C or 1095-B with the IRS.  As in prior years, the IRS indicated in Notice 2019-63 that it would not impose these penalties for incomplete or inaccurate forms for the 2019 calendar year (due in 2020), if the reporting entity can show that it “made good-faith efforts to comply with the information-reporting requirements.”  This good-faith reporting relief does not apply to forms that were untimely furnished to individuals or filed with the IRS.

Section 6055 Relief

Under Section 6055 of the Internal Revenue Code (the “Code”), providers of minimum essential coverage must furnish certain information to “responsible individuals” about enrollment in the minimum essential coverage during the previous calendar year.  The purpose of this reporting requirement is to assist the IRS enforce compliance with the “individual mandate” penalty under the ACA.

Under the Tax Cuts and Jobs Act of 2017, the individual mandate penalty was not repealed, but the penalty amount was reduced to zero.  This makes reporting under Section 6055 of the Code irrelevant.  As a result, Notice 2019-63 provides limited relief from the reporting requirements under Section 6055 of the Code.

Here is a brief summary of the Section 6055 reporting requirements:

  • Insurers. For employers that sponsor fully insured group health plans, the plan’s insurer must comply with the Section 6055 reporting requirements using Forms 1094-B and 1095-B.
  • Self-Funded Plan Sponsors. For employers that sponsor self-funded plans, the employer must comply with the Section 6055 reporting requirements. But, the applicable forms depend on whether or not the employer is an “applicable large employer” that is subject to the Employer Shared Responsibility Payment (i.e., the “pay or play” penalty):
    • Small Employers. Employers that are not subject to the pay or play penalty use Forms 1094-B and 1095-B.  (Employers that are not subject to the pay or play penalty generally don’t have enough employees to sponsor a self-funded plan.  So, it is rare for employers to file Forms 1094-B and 1095-B.)
    • Large Employers. Employers that are subject to the pay or play penalty generally use Forms 1094-C and 1095-C.  (Forms 1094-C and 1095-C allow the employer to comply with its reporting obligations under both Sections 6055 and 6056 of the Code.  Under Section 6056 of the Code, employers must report compliance with the pay or play penalty.)

Notice 2019-63 provides relief with respect to Forms 1095-B and limited relief with respect to Forms 1095-C.  For insurers and small self-funded employers, the entity must still prepare and file the Forms 1095-B with the IRS.  However, these entities are not required to furnish individuals with a copy of the Form 1095-B as long as the entity satisfies both of the following requirements:

  • The entity prominently posts a notice on its website stating that responsible individuals may receive a copy of their Form 1095-B upon request. The notice must contain both an email and a physical address that responsible individuals can use to request their Form 1095-B, and a telephone number that the responsible individual can use to contact the entity with questions.
  • The entity furnishes the responsible individual with their Form 1095-B within 30 days of the date that the entity receives the request.

Notice 2019-63 generally does not extend this relief to large self-funded employers, except for Forms 1095-C that are prepared on behalf of individuals who are not full-time employees for the entire 2019 calendar year.  A large employer sponsor of a self-funded plan may file a Form 1095-C on behalf of an individual who was enrolled in the self-funded plan during the 2019 calendar year, but was not a full-time employee during any month of the calendar year.  (For these individuals, the “all 12 months” column of line 14 is completed using the code “1G.”)  Examples of where this relief may extend to Forms 1095-C are: (1) former employees who terminated employment before 2019 but were enrolled in the self-funded plan under COBRA or retiree coverage; and (2) employees who were part-time during all of 2019, but were enrolled in the self-funded plan because the plan sponsor extended eligibility for the self-funded plan to part-time employees.


While the filing deadline extension and the extension of the good-faith reporting relief is likely welcome news to insurers and employers alike, it’s probably not surprising.   And, while the Section 6055 reporting relief is likely surprising, it’s probably only meaningful to insurers.

Proposed Rule Would Require Health Plans to Disclose Out-of-Pocket Costs by Providers

November 26 - Posted at 1:32 AM Tagged: , , , , , , , ,

In a proposed regulation, federal agencies suggest a rule that would require employer-sponsored group health plans to provide plan enrollees with estimates of their out-of-pocket expenses for services from different health care providers. Plans would make this information available through an online self-service tool so enrollees could shop and compare costs for services before receiving care.

Comments are due by Jan. 14, 2020, on the transparency-in-coverage rule issued by the departments of Health and Human Services, Labor and the Treasury. The unpublished rule was released on Nov. 15, when the agencies also posted a fact sheet summarizing the proposal.

Some feel that the rule, if finalized, would be the most dramatic expansion of disclosure obligations for group health plans since the ERISA was passed in 1974.

The proposal is part of the Trump administration’s attempt to create price competition in the health care marketplace. It follows the November release of a final rule requiring hospitals to publish their prices online for standard charges, including negotiated rates with providers. That rule, to take effect Jan. 1, 2021, is expected to be challenged in court by hospital industry groups.

Key Requirements

The new proposal would apply to all health plans except those that are grandfathered under the Affordable Care Act. Among other obligations, group health plans and health insurance carriers would be required to do the following:

  • Make out-of-pocket costs for all covered health care items and services available to plan enrollees through a self-service website. The information would be available in paper form on request and presented in a format similar to an explanation of benefits notice.
  • Make in-network rates negotiated with the plan’s network providers, as well as past payments made to out-of-network providers, publicly available. This information would be updated monthly.


A Step Further

Information about employees’ out-of-pocket expenses and cost-sharing under employer plans is already disclosed in pre-service and post-service benefit claim determinations. However, “the proposed rules would take these disclosure requirements a step further by requiring individually tailored cost estimates prior to the receipt of services,” noted Susan Nash, a partner at law firm Winston & Strawn in Chicago.

While transparency in health care pricing is generally welcomed by employers, she observed, “employers may balk at the cost of preparing the online or mobile app-based cost-estimator tools, or purchasing such tools from vendors.”

In addition, because much of the information required to be disclosed is specific to the participant and the benefit option in which the participant is enrolled, the disclosures “will require greater coordination among employers and third-party administrators, pharmacy benefit managers, [and] disease management, behavioral health, utilization review, and other specialty vendors and will require amendments to existing agreements,” Nash explained.

The rules around public disclosure will likely be opposed by health insurance carriers who view their price negotiation as confidential and part of the service that they provide as carriers, and insurers are likely to challenge them in court, as hospital systems are expected to do with the final rule on disclosing their prices.

7 Affordable Ways to Boost Morale

October 28 - Posted at 1:00 PM Tagged: , ,

You don’t have to spend a lot to make a big difference in your workplace.  Many of the ideas below show how effective HR can be by simply helping employees relax, connect and enjoy each other’s company. And the end result….happy people are productive people.

1. Give Employees a Voice
For some companies, boosting morale and encouraging teamwork are orchestrated parts of a specific plan to give back to the community. Other companies simply gather volunteers and go for it—they hold events with the primary aim of letting employees have fun and enjoy each other’s company. 

Employees at one company volunteer to serve on an engagement committee. In the past, they have proposed a variety of events, including collecting food for local charities, decorating the lobby for holidays and holding a Halloween costume contest.

Don’t let managers do the event planning. Let employees make the decisions as that helps them feel listened to.

Employees at this organization have been receptive and this has even had a positive impact on their clients. These events have reduced employee turnover to 22 percent from 36 percent in six months.

2. Encourage Friendly Competition
They’re energetic employees, and sometimes they need to blow off steam. So why not have a tug-of-war? 

That’s what Symplicity Corp. in Arlington, Va., invites its employees to do periodically throughout the year.

About 30 employees gather in the parking lot, and the tug begins. They pull, they huff, they puff. Or they collapse in laughter. The game is a great diversion and has been a hit with employees.

Symplicity’s tug-of-war isn’t competitive. (Well, maybe a little bit.) Nor is it expensive: The thick, braided rope cost $70, she says, and has been re-used numerous times.

Other inexpensive events include:

  • Game nights. Employees bring games (especially strategy-based games) to the table. Outside the office, employees join in online or Xbox games. The company provides $30 worth of snacks and beverages.
  • Guest speakers. Once a quarter, a guest speaker is invited through a professional network. The topics, including cybersecurity and healthy living, can be work-related—or not. 

Employees also are invited to movie nights, live music events and camp-outs.

The events are orchestrated by Symplicity’s “party people group,” about eight to 10 volunteers who get together each February to brainstorm events for the year.

3. Promote Healthy Living
A San Diego hotel group relayed the importance of healthy eating to its housekeeping staff by providing nutritious snacks, including apples, frozen fruit trays, salad and healthy burritos every Friday.

The hotel partnered with a community program, Live Well @ Work, to teach about nutrition in fun, positive ways.

The hotels arranged to help employees understand the ins-and-outs of nutrition labels and demonstrated, for example, how much sugar is in a bottle of soda. The organization tapped community groups and the American Red Cross to provide free recipe books and pedometers. The hotels also scheduled occasional exercise sessions for some pre-work stretches.

“Fruit Fridays” has proven to be an extremely successful program and very low-cost. Not only has it helped increase employee engagement but has definitely improved morale and provided a short break from the normal day.

4. Get Employees Moving
Talk about throwbacks. Scranton Gillette Communications runs a Tour de France tricycle race for employees. No, that’s not a typo. Tricycle race.

For the past two summers, the company’s HR department has rounded up donated tricycles and scheduled a fairly slow “race” around the office parking lot.

As employees tackle each 50-yard race to make it to the next round of competition, their colleagues staff hydration stations. To top it off, the winners take home small trophies. 

The company is big into fitness programs and cheerleads for other events, too. It runs a summer challenge encouraging employees to count their steps. HR team members keep a spreadsheet to log their steps over a four-week period. Prizes are given for the most overall steps, the most improved participant and the first to reach a personal milestone, such as 50 or 75 miles. 

Their HR team also sponsors a “stairmageddon,” calling on its 130 employees to count the number of stairs they climb in a day. The person who takes the most flights wins a gift card.

Other fun events include a mini-golf tournament (played in the office hallways), a Wiffle ball home run derby (scheduled to coincide with the start of baseball season), and a paper airplane contest which has employees launching their creations into an atrium from the second floor.

It’s not all about fitness, though. Employee appreciation is also shown on Strawberry Shortcake Day and Root Beer Float Day with low-cost (if not low-calorie) treats.

Employees also enjoy no-cost activities such as designated days to wear their favorite sports team jerseys. 

Each employee who participates receives a raffle ticket. At the end of the month, one employee wins a $20 gift card and is featured in the next employee newsletter. 

5. Communicate Clear Goals
Games and fun events can do more than just bring people together. 

One of the most important things a company can do is let employees know what’s expected of them. But that wasn’t happening at Hi-Grade Welding and Manufacturing in Schaumburg, Ill. So the HR team sought ways to improve communication between managers and the company’s 116 employees. 

Changes began with the purchase of two $500 televisions, one for the shop floor and another for the lobby. Each department’s goals are displayed on the TV screens, along with numbers reflecting the amount of rejected products. The quality of work has improved (and the amount of rejected products has been reduced) since the statistics have been shared openly. That simple change helped motivate and engage employees in a friendly competition with other departments to improve quality, she adds.

6. Help the Community
One of Symplicity’s most popular events is a program coordinated by the company that enables employees to volunteer at a local food kitchen.

Employees also take paid time off from work to read to children and participate in Earth Day cleanups.

7. Say Thank You
Two years ago, Jennifer, an HR assistant manager at Enertech Global LLC in Mitchell, S.D., was looking for a way to recognize the company’s 116 employees.

She glued a penny to a piece of card stock and added the words, “Just like finding a penny is good luck, we are lucky to have YOU. Thank you for everything you do every day.” As an extra touch, the plant manager signed each card. 

There are people that have theirs hanging up which proves that at the end of the day, we all just want to feel wanted and appreciated.

That’s why the HR team at Clarus tries to do something special when employees are working on major projects and under a lot of stress. The HR professionals hand out small gifts along with notes expressing their thanks.

The gestures help maintain morale and let “employees know we appreciate all they’re doing for us.”

The HR team also tries to introduce a little levity into their messages to lighten the workers’ mental load. In the past, employees have received a bag of microwave popcorn with a note: “Bursting with excitement you’re on our team!” or a Mounds candy bar with the message: “Thank you for the mounds of work you’re doing!”

Other small gifts to show gratitude include:

  • Highlighters. “You’re the HIGHLIGHT of our day.”
  • Fun-shaped paperclips. “Thanks for keeping things together around here.”
  • Chewing gum. “Your hard work BLOWS us away.”
  • Mentos mints. “We’ve MENTO tell you how much we appreciate you.”
  • Donuts. “We DONUT know what we’d do without great employees like you.”

When the company wants to commend employees for a specific effort, they place messages on an employee’s desk before they start the workday. The surprise gesture helps them start their day off on a positive note.

Avoiding Halloween Pitfalls in the Workplace

October 27 - Posted at 7:40 PM Tagged: , ,

Seasonal office parties, complete with decorations and costumes, can be a great opportunity for employee engagement, communication, team building and simply having fun with co-workers. 

However, we should recognize that things can go awry and people may have other concerns that will need to be addressed. Not all employees want to participate in decorating the office, wearing a costume or attending a party, or want to deal with decorations, costumes and behaviors that are inappropriate.

As leaders, we need to maintain professionalism in the office, even during Halloween. Workplace rules and dress code policies still need to be enforced. Here are some tips to communicate the organization’s expectations and hold everyone accountable.

  • Indecorous decorations? Companies are generally advised not to decorate for Halloween and to communicate to employees that “gruesome or graphic or otherwise distracting decor is not allowed.”  You may want to consider allowing a a small pumpkin decoration on one’s desk as acceptable, but “witches, demons and goblins can be unprofessional and potentially offensive to co-workers and customers.”
  • “What dress code?” Employees depart from the dress code we normally expect at work for costume events such as Halloween, and for casual days, but the main policy still needs to be enforced.  Organizations should give examples of appropriate and inappropriate costumes or casual wear to make sure employees follow the rules. Examples of Halloween costumes that could raise red flags include a giant inflatable “poop” emoji, a famous comedian hauling away an unconscious woman, celebrities who overdosed or committed suicide, the president with a garish comb-over wig, as well as the commonplace “sexy” outfits. If employees violate the policy, send them home to change or ask them to cover the offending attire. Coach and counsel or discipline as needed.
  • “Is this mandatory?” The organization should make clear that participation in any Halloween festivities is voluntary and that no one will be forced to do anything. Some employees may be offended or even afraid to celebrate something they associate with evil, and supervisors need to be sensitive to that.  Proper supervisor and manager training can also help with this.


The ICHRA Notice: What Are The Requirements?

September 29 - Posted at 10:23 PM Tagged: , ,

The Departments of the Treasury, Labor, and Health and Human Services (the Departments) released information regarding the individual coverage HRA (ICHRA) notice requirements earlier this year.

The notice, which must be sent to all eligible employees 90 days before the benefit is offered, is primarily intended to inform eligible employees of how the ICHRA affects premium tax credits. This information will help employees make an informed decision on whether to participate in the ICHRA or opt out. It also notifies employees that a benefit is being offered and what they can expect from the ICHRA.

This highlights everything your ICHRA notice needs to include so that you’re offering the benefit in a compliant way.

When offering an ICHRA an employer must provide a notice including the following:

  • A description of the terms of the ICHRA. This should include the maximum dollar amount available for each participant in the HRA, which family members (if any) are included in the benefit, and whether the allowance amount will vary based on family size or age. The terms should also indicate the date in which coverage will first become effective and what date the plan year begins and ends. The notice must also provide information on when amounts will be made available (for example, monthly or annually). If the allowance does vary based on family size, the notice should clearly indicate the amount provided for a single individual. That’s the amount employees will use to determine affordability, which is a major component of determining premium tax credit eligibility under an ICHRA.
  • A statement of the right of the participant to opt out of and waive future reimbursement under the HRA. This should make clear to the employee that they have the ability to opt out of or decline the benefit. Be sure to inform them how and when they should opt out of coverage. It’s best practice to have the employee advise in writing they were offered the benefit and are choosing not to accept it.
  • A statement on how the ICHRA will affect premium tax credit (PTC) availability, whether the employee opts out or chooses to accept the benefit. If an employee accepts the benefit, they lose the option of utilizing a PTC. If an employee opts out and the ICHRA offering is deemed unaffordable, they may qualify for a PTC depending on income and other eligibility factors. If an employee opts out and the ICHRA coverage is deemed affordable, they won’t qualify for a PTC.
  • A statement that the participant must inform any Exchange to which they apply for APTC (advanced premium tax credit) of certain relevant information. This should notify the employee to disclose the ICHRA offering when applying for coverage on the Exchange. That will allow the Exchange to determine if they’re eligible for a tax credit.
  • A statement about how the ICHRA differs from other HRAs. The notice should contain a description about what the ICHRA is. It should also provide clarification that there other types of HRAs and that the plan being offered is not a QSEHRA, or any other type of HRA.
  • A statement about the availability of an SEP for employees and dependents who newly gain access to the HRA. The requirements state that employees must be notified that they gain access to a special enrollment period (SEP) when they are newly offered the HRA. If an ICHRA starts on a date other than January 1 or if an employee is newly hired during the plan year, they can enroll in individual health insurance coverage outside of open enrollment using an SEP. If an employee becomes eligible for an ICHRA that would start at the beginning of the plan year, they’ll need to enroll in an individual coverage plan within the 60-day period before the first day of the plan year. If an employee becomes eligible for HRA coverage that would start mid-year (as with a new employee, or an employee with a change in hours), they may enroll in individual coverage up to 60 days before the first day that their ICHRA can begin, or up to 60 days after this date.
  • A statement about how the participant can find assistance for determining their individual coverage HRA affordability. The Exchange website will provide information on how the employees can determine affordability under the ICHRA. 
  • A statement that the ICHRA can be integrated with Medicare. Employees must be informed that Medicare can be integrated with the ICHRA. The statement must also disclose that Medicare beneficiaries are ineligible for a premium tax credit, regardless of whether the ICHRA the individual is offered is affordable, provides minimum value, or whether the individual opts out of the HRA.
  • Contact information of an individual or a group of individuals who participants can contact with questions regarding their ICHRA. The notice must include, at least, a phone number of an individual or group that participants may contact with questions about the ICHRA. The employer is allowed to determine who is best suited to help the participants.

Note: Per the Departments, for ERISA-covered plans, other disclosure requirements may require participants to be provided with a reasonable opportunity to become informed of their rights and obligations under the ICHRA.

When must the notice be provided?

For new ICHRAs, including those starting January 1, 2020, businesses must adhere to a 90-day notice requirement. That means that 90 days before the ICHRA’s start date, they must send employees a notice including each of the components above and notifying them of their eligibility for the benefit. For a plan starting on January 1, 2020, businesses must provide notice to employees on or before October 3, 2019.

The 90-day notice must provided every year your business chooses to offer the ICHRA.

For newly eligible employees (newly hired employees or employees who gain eligibility after the initial start of the plan year), the timing is different. Your business can provide the notice up until the first day the employee’s ICHRA coverage begins. It’s best to provide notice as soon as possible, so the employee has ample time to review coverage options and enroll in a plan.


The Departments have provided a model notice that employers can use as a template for their notice. It’s not required that you use the model, but the Departments have advised use of the model is sufficient for good faith compliance of the requirements as long as it’s provided within the correct time frame. Whether you use the model or not, be sure to include each of the requirements listed above and send the notice within the 90-day notice period.


Oct. 15th Deadline Nears for Medicare Part D Coverage Notices

- Posted at 10:16 PM Tagged: , , ,

Prior to each year’s Medicare Part D annual enrollment period, plan sponsors that offer prescription drug coverage must provide notices of creditable or noncreditable coverage to Medicare-eligible individuals.

The required notices may be provided in annual enrollment materials, separate mailings or electronically. Whether plan sponsors use the federal Centers for Medicare & Medicaid Services (CMS) model notices or other notices that meet prescribed standards, they must provide the required disclosures no later than Oct. 15, 2019.

Group health plan sponsors that provide prescription drug coverage to Medicare Part D-eligible individuals must also disclose annually to the CMS—generally, by March 1—whether the coverage is creditable or noncreditable. The disclosure obligation applies to all plan sponsors that provide prescription drug coverage, even those that do not offer prescription drug coverage to retirees.


The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 requires group health plan sponsors that provide prescription drug coverage to disclose annually to individuals eligible for Medicare Part D whether the plan’s coverage is “creditable” or “noncreditable.” Prescription drug coverage is creditable when it is at least actuarially equivalent to Medicare’s standard Part D coverage and noncreditable when it does not provide, on average, as much coverage as Medicare’s standard Part D plan. The CMS has provided a Creditable Coverage Simplified Determination method that plan sponsors can use to determine if a plan provides creditable coverage.

Disclosure of whether their prescription drug coverage is creditable allows individuals to make informed decisions about whether to remain in their current prescription drug plan or enroll in Medicare Part D during the Part D annual enrollment period. Individuals who do not enroll in Medicare Part D during their initial enrollment period (IEP), and who subsequently go at least 63 consecutive days without creditable coverage (e.g., they dropped their creditable coverage or have non-creditable coverage) generally will pay higher premiums if they enroll in a Medicare drug plan at a later date.

Who Gets the Notices?

Notices must be provided to all Part D eligible individuals who are covered under, or eligible for, the employer’s prescription drug plan—regardless of whether the coverage is primary or secondary to Medicare Part D. “Part D eligible individuals” are generally age 65 and older or under age 65 and disabled, and include active employees and their dependents, COBRA participants and their dependents, and retirees and their dependents.

Because the notices advise plan participants whether their prescription drug coverage is creditable or noncreditable, no notice is required when prescription drug coverage is not offered.

Also, employers that provide prescription drug coverage through a Medicare Part D Employer Group Waiver Plan (EGWP) are not required to provide the creditable coverage notice to individuals who are eligible for the EGWP.

Notice Requirements

The Medicare Part D annual enrollment period runs from Oct. 15 to Dec. 7. Each year, before the enrollment period begins (i.e., by Oct. 14), plan sponsors must notify Part D eligible individuals whether their prescription drug coverage is creditable or non-creditable. The Oct. 14 deadline applies to insured and self-funded plans, regardless of plan size, employer size or grandfathered status

Part D eligible individuals must be given notices of the creditable or non-creditable status of their prescription drug coverage:

  • Before an individual’s IEP for Part D.
  • Before the effective date of coverage for any Medicare-eligible individual who joins an employer plan.
  • Whenever prescription drug coverage ends or creditable coverage status changes.
  • Upon the individual’s request.

According to CMS, the requirement to provide the notice prior to an individual’s IEP will also be satisfied as long as the notice is provided to all plan participants each year before the beginning of the Medicare Part D annual enrollment period.

Model notices that can be used to satisfy creditable/non-creditable coverage disclosure requirements are available in both English and Spanish on the CMS website. Plan sponsors that choose not to use the model disclosure notices must provide notices that meet prescribed content standards.

Notices of creditable/non-creditable coverage may be included in annual enrollment materials, sent in separate mailings or delivered electronically. Plan sponsors may provide electronic notice to plan participants who have regular work-related computer access to the sponsor’s electronic information system. However, plan sponsors that use this disclosure method must inform participants that they are responsible for providing notices to any Medicare-eligible dependents covered under the group health plan.

Electronic notice may also be provided to employees who do not have regular work-related computer access to the plan sponsor’s electronic information system and to retirees or COBRA qualified beneficiaries, but only with a valid email address and their prior consent. Before individuals can effectively consent, they must be informed of the right to receive a paper copy, how to withdraw consent, how to update address information, and any hardware/software requirements to access and save the disclosure. In addition to emailing the notice to the individual, the sponsor must also post the notice (if not personalized) on its website.

In Closing

Plan sponsors that offer prescription drug coverage will have to determine whether their drug plan’s coverage satisfies CMS’s creditable coverage standard and provide appropriate creditable/noncreditable coverage disclosures to Medicare-eligible individuals no later than Oct. 15, 2019.

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