October 2025 HR Newsletter | Forsite Benefits

Oct. 15 Deadline for Medicare Part D Coverage Notices

Employers must notify Medicare-eligible policyholders if their prescription drug coverage is credible or not.

The Medicare Modernization Act (MMA) requires entities (whose policies include prescription drug coverage) to notify Medicare-eligible policyholders whether their prescription drug coverage is creditable, (which means that the coverage is expected to pay, on average, as much as the standard Medicare prescription drug coverage) or non-creditable.

2025 brought significant change to the determination of credibility.

Starting 2025, CMS has reduced the maximum out-of-pocket on Medicare Part D plans from $8000 down to $2000. This change likely precludes most high deductible health plans (HDHPs) from qualifying as credible coverage. This means any individual covered under a group plan that is Medicare Part D eligible may face a penalty of 1% of the national base premium ($34.70 in 2024) times the number of uncovered months.

Example:

Mrs. Martinez has Medicare, and her first chance to get Medicare drug coverage (during her Initial Enrollment Period) ended on July 31, 2024. She doesn’t have credible prescription drug coverage from any other source. She didn’t join a Medicare drug plan by July 31, 2024 or during Open Enrollment in 2024, and instead will join during the Open Enrollment Period ending December 7, 2025. Her Medicare drug coverage will start January 1, 2026.

Since Mrs. Martinez was without creditable prescription drug coverage from August 2024–December 2025, her penalty in 2025 is 17% (1% for each of the 17 months) of $34.70 (the national base beneficiary premium) or $5.90 each month will be added to her Medicare Part D premium.

Here's the math:

17 (17% penalty) × $34.70 (Base beneficiary premium) = $5.90

$5.90 = Mrs. Martinez's monthly late enrollment penalty for 2026

Who Must Comply

The disclosure requirements apply generally to employers sponsoring group health plans that offer prescription drug coverage to Medicare-eligible individuals.

Model notices/templates

These model notices may be used to satisfy this requirement, issued by the Centers for Medicare & Medicaid Services.

Medicare Part D – Creditable Coverage Disclosure Notice Template - [View]
Non-Creditable Coverage Disclosure Notice Template - [View]

Information Required

Notifies Medicare-eligible individuals whether the plan's prescription drug coverage is creditable coverage, meaning the coverage is expected to pay, on average, as much as the standard Medicare prescription drug coverage.

Note: Individuals who do not maintain creditable coverage for 63 days or longer following their initial enrollment period for Medicare Part D may be required to pay a late enrollment penalty. Accordingly, this information is essential to the decision to enroll in a Medicare Part D prescription drug plan.

Who it must be provided to

Medicare-eligible active employees and their dependents
Medicare-eligible COBRA individuals and their dependents
Medicare-eligible disabled individuals covered under the prescription drug plan
Any retirees and their dependents

Who it must be provided by

Employers who sponsor group health plans that offer prescription drug coverage to Medicare-eligible individuals.

When it is Due

Prior to the annual enrollment period for Medicare Part D that begins on Oct. 15th
Prior to an individual's initial enrollment period for Medicare Part D
Prior to the effective date of enrolling in the employer's prescription drug plan and upon any change that affects whether the coverage is credible
Upon request by the individual

Online disclosure to the Centers for Medicare & Medicaid Services is also required annually, no later than 60 days from the beginning of a plan year, within 30 days after termination of a prescription drug plan, or within 30 days after any change in creditable coverage status.

[ VIEW ONLINE DISCLOSURE ]

Core Values Master Class with Sarah Marshall

Wednesday, October 29th

11:00 AM CST

When captured and applied, core values provide clarity, energy and aliveness to individuals and entire businesses.

They are a powerful differentiator that attract and connect individuals and organizations to each other.

Explore the value and power of authoring personal core values and the importance of organizational core values in any role that impacts the people touchpoints of your business.

Strengthen your ability to align individual and organizational core values, resulting in better hiring decisions, more meaningful employee relationships, clearer vision and stronger decision making.

You’ll learn from:

Sarah Marshall, Co-Founder & The Experience Architect at humanworks8

Sarah is at her best when helping leaders work through plans of action that strengthen the employee experience – that’s what makes her the Experience Architect at humanworks8, where she not only builds the roadmap to better culture, but executes that strategy alongside her clients.

6 Open Enrollment Communication Tips

Effective communication is critical to educate and inform employees about new, returning or expanded benefits options. Consider these six open enrollment communication tips:

Select a mix of appropriate channels. For example, digital channels can help distribute and house information virtually. Alternatively, there’s still a time and place for on-site meetings and mail-to-home print materials. Every workplace is different, so it comes down to selecting various channels that are relevant and engaging to each organization’s specific employees.

Keep it simple. It’s vital to simplify benefits information. Links or attachments could explore the benefits further and offer the fine print.

Make it digestible. Traditional benefits booklets can be lengthy; instead, employers could deliver bite-sized information to employees through methods such as videos and emails.

Use real-world examples. Employees can relate to stories, so find ways to bring the options to life.

Avoid jargon. To help make benefits easier to understand, avoid HR or benefits-related jargon. Additionally, many benefits are acronyms, so employers should help decode and explain the alphabet soup to employees.

Personalize communication. Depending on the workforce and their working environments, employers will likely need to segment their employee audience and tweak messaging so it resonates.

Employer Takeaway

Educating and informing employees about their benefits options is an important part of open enrollment. Effective employee communication may evolve, but it comes down to helping employees feel well-informed about their benefits options and confident about their choices.

Overcoming Employee Pessimism

A workplace environment can be crucial in shaping employee productivity, retention and overall job satisfaction. While optimism among a workforce can help create a great workplace culture, pessimistic employees can quietly erode even the most well-intentioned work environments.

Common Reasons for Employee Pessimism

A pessimistic workplace occurs when negativity and expectations for poor outcomes are prevalent. Employees may focus on what could go wrong, feel that hard work won’t have positive results, and have a general sense of despair and indifference. This mindset can have devastating impacts on an organization.

Some pessimism is natural in the workplace, but excessive negativity can build over time if employers aren’t actively shaping their workplace culture. Some common reasons for employee pessimism include economic uncertainty, burnout, financial strain, lack of career advancement and concerns about organizational stability.

How to Overcome Employee Pessimism

Employers can find it challenging to change the culture even when they know the source of employee pessimism. The following strategies may be helpful to overcome employee pessimism:

Understand the root cause of pessimism.
Allow for open communication.
Provide support and resources, such as mental health services, wellness programs and peer support networks.
Focus on career development opportunities.
Strengthen team connections.
Reward positive attitudes and teamwork.

Employers can create opportunities to improve an organization’s culture by observing and reacting to workplace attitudes. A positive work environment can help attract top talent, improve employee performance and increase retention.