•  
 /  About Us / Details
July 5, 2007

Note to Employers Seeking Medicare Retiree Drug Subsidy: Reconciliation

For employers who offered retiree drug benefits in 2006, and who have made application to receive the subsidy, reconciliation of the 2006 plan year is due 15 months following the close of the plan year.  For a calendar year plan, the first reconciliation will be due by March 15, 2008.  For plans whose reconciliation would be due prior to that date, an automatic extension is given until November 30, 2007. 

The purpose of the reconciliation is to ensure that the amounts being claimed by the employer match Medicare records.  A subsidy can only be claimed for drugs reimbursed to individuals listed by Medicare.  If an employer has received an interim payment, the reconciliation will show whether CMS has the right to recover; this would occur in the event of an overpayment; or, whether the employer is owed additional money. 

The reconciliation process is to be accomplished online via CMS’ Retiree Drug Subsidy website.

 

The information contained in this Benefit Beat is not intended to be legal, accounting, or other professional advice, nor are these comments directed to specific situations.

As required by U.S. Treasury rules, we inform you that, unless expressly stated otherwise, any U.S. federal tax advice contained in this Benefit Beat is not intended or written to be used, and cannot be used, by any person for the purpose of avoiding any penalties that may be imposed by the Internal Revenue Service.

Insights in Your Inbox
Find Us
  • OR