Medicare.gov

Creditable prescription drug coverage

Creditable prescription drug coverage is prescription drug coverage that’s expected to pay, on average, at least as much as Medicare drug coverage. This could include drug coverage from a current or former employer or union, TRICARE, the Indian Health Service, or the Department of Veterans Affairs (VA). Your current plan can tell you if your drug coverage is creditable prescription drug coverage.

Why do I need to have it?

Even if you don’t take any drugs now, consider getting Medicare drug coverage when you first sign up for Medicare. If you go 63 days or more in a row without Medicare drug coverage OR other creditable prescription drug coverage after you were eligible for Medicare, you may have to pay a Part D late enrollment penalty  if you sign up for Medicare drug coverage later. Generally, you’ll pay this penalty for as long as you have Medicare drug coverage. How do I avoid late enrollment penalties?

When you join a Medicare drug plan or health plan, it may send you a letter asking if you had creditable prescription drug coverage. You can tell your Medicare plan that you had other creditable prescription drug coverage by completing the form and returning it by the deadline in the letter.

The drug coverage you already have may change if you keep it and also enroll in Medicare drug coverage. 

  • You, your spouse, or dependents may lose all of your employer or union health coverage if you get Medicare drug coverage.
  • Out-of-pocket drug costs with your employer or union drug coverage could be different compared to out-of-pocket drug costs with Medicare drug coverage.

If you have (or are eligible for) other types of drug coverage, read all the materials you get from your insurer or plan provider. Talk to your benefits administrator, insurer, or plan provider before you make any changes to your current coverage. Learn more about how other coverage works with Medicare.

If I (or my spouse) have employer or union drug coverage, can I keep it?

Prescription drug coverage is insurance. Doctor samples, discount cards, free clinics, or drug discount websites aren’t drug coverage.

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