Retiree Readiness Helping You Transition to Supplemental Medicare Insurance.

Retiree Readiness Helping You Transition to Supplemental Medicare Insurance

4/20/2017 A Bit of Context TCU changed the way it provides medical benefits to Medicare-primary retirees and their Medicare-primary dependents. Retiree’s medical benefits are managed through a Health Reimbursement Arrangement account (HRA). TCU funds the Health Reimbursement Account at a rate equivalent to $ per month, per covered individual. The account is funded annually - $ per covered individual ($ for retiree and covered spouse). Funding prorated for the 1st of the month following retirement date. In the past, the total monthly premium for the group Medicare Companion plan was $ retiree paid $ per person and TCU paid $ per person. 2013 Towers Watson All rights reserved. Proprietary and Confidential.

What we’ll cover today Why this approach? How this affects you Medicare 101 Introducing OneExchange Going forward Questions & answers

Why This Approach? Provides Medicare-eligible retirees with:
Greater flexibility in how to use health care dollars A broader range of plan options Enables TCU to continue supporting retirees during a time of uncertainty surrounding the rising cost of medical insurance and services Enables TCU to predict and budget for health care costs more accurately

How This Affects Medicare Eligible Retirees
Medical premiums and out-of-pocket costs will vary depending on the coverage you choose. You will work with OneExchange to enroll in a plan that meets your medical and Rx needs. TCU will establish your Health Reimbursement Account. This account will be administered by OneExchange OneExchange Advisors will help you understand the costs associated with your coverage – premiums, co-payments, deductibles and all other costs. What you pay How to enroll Your support

1-800-MEDICARE CMS – Center for Medicare & Medicaid Services
HHS agency that governs everything Medicare 1-800-MEDICARE

Original Medicare: A Health insurance program for
People 65 years of age and older Some people with disabilities People with End Stage Renal Disease (ESRD) Administered by CMS and the State Department of Insurance Enrollment handled by Social Security Administration or Railroad Retirement Board The Medicare and Medicaid programs were signed into law on July 30, 1965 by President Lyndon B. Johnson. The first Medicare beneficiary was former President Harry S. Truman who was present at the signing. The most significant legislative change to Medicare--called the Medicare Modernization Act or MMA--was signed into law by President George W. Bush, on December 8, This historic legislation adds an outpatient prescription drug benefit to Medicare and makes many other important changes. Since 1965, a number of changes have been made to CMS ( Centers for Medicare & Medicaid Services) programs. Moreover, the agencies charged with implementing the programs have changed as well. See agency history for more information about Medicare's early days in Social Security, Medicaid's early days in the Social and Rehabilitative Services Administration, and why they were joined together into one agency in 1977. Key Terms Medicare Part A = Hospital Coverage – administered by CMS Medicare Part B = Medical Coverage – administered by CMS Medicare Part C = Medicare Advantage Plans – private plans – group or individual market Medicare Part D = Prescription Drug Coverage – private plans – group or individual market Medicare Supplement (Medigap) – private plans – group or individual market 8

Original Medicare: Part A (Hospital)
Premiums: Most people do not pay a monthly Part A premium because they or a spouse have 40 or more quarters of Medicare-covered employment. $ for quarters of Medicare-covered employment. $ for people who have less than 30 quarters of Medicare employment. Foreign citizens and Americans who worked abroad Coverage: Medicare Part A covers: Hospital Stays Skilled Nursing Facility (SNF) Home Health Care Hospice Care Pints of blood received at a hospital or skilled nursing facility during a covered stay 9

Original Medicare: Part B (Medical)
Coverage: Doctors’ services (physician office and some hospital settings) Limited Chiropractic Services Outpatient Services: Diagnostic tests- clinical Lab (x-ray, MRI, CAT, EKT, nutritional therapy, etc…) Other medical services Durable medical equipment (DME)- prosthetic, wheelchair etc. Diabetic Supplies Ambulance service Initial Enrollment Period: When turning 65. 3 months before, the month of, and three months after 65th B-Day. (7 month window) 10

Medicare Part B - Late Enrollment Penalty
A person that is eligible for Medicare but opts out of Part B may be subject to a 10% per year Part B penalty Penalty is waived if beneficiary has coverage through a group policy based on active employment A person that is eligible for Medicare but opts out of Part B may be subject to a 10% per year Part B penalty. Penalty is waived if beneficiary has coverage through a group policy based on active employment There are limited times when someone can enroll in Part B: When first turning 65 or eligible for Medicare due to disability If receiving insurance due to active employment, anytime while covered (could be under spouses coverage) 8 months after employment ends If they do not enroll during these periods, they may be subject to a Late Enrollment Penalty when they do enroll. Refer anyone asking about delaying their enrollment into Part B back to the Social Security Administration. They are the experts on the rules.

Medicare Eligibility & Active Employment
For employers with 20 or more employees, group coverage is primary for Medicare beneficiaries who are still active, and Medicare is secondary. Therefore, active beneficiaries don’t have to enroll in Part B and will not be penalized when they decide to retire. When they decide to retire, beneficiaries should enroll in Part B three months prior. This will insure that they can enroll in a Medicare Supplement plan and have it effective as soon as their group coverage ends. If active and covered under the group health plan, employee does not enroll in Medicare Part B or select a Medicare supplemental plan(s) until they retire or lose coverage. 12

Post – 65 Coverage Options
Primary Coverage Medicare A & B Additional Coverage (your choice) Medicare Advantage with Prescription Drug (MAPD) OR Medigap + Prescription Drug

Part D: What is Medicare Part D?
Medicare Part D is optional prescription drug coverage for everyone with Medicare Part A and/or B PDP’s are run by private insurance companies approved by Medicare (Like MA plans) If beneficiaries decline to enroll in a Medicare drug plan when they are first eligible, they may be penalized. (1% of national average per month) Beneficiaries sign up when they first become eligible for Medicare, or during the AEP 14

Aging Into Medicare – Turning 65
All Medicare beneficiaries receive a Medicare card when they become eligible. This will contain their full name, Medicare Claim number and the dates your Medicare Part A and B became effective. Beneficiaries may use this card with any medical provider in the country that accepts Medicare. A beneficiary is automatically enrolled in Part B when enrolled in Medicare Part A. If you do not want Part B, you must opt out of that coverage. This card is generally sent three months before turning age 65. Must Have Original Medicare A & B to be Able to Consider Any Supplemental Medicare Medical Insurance [either Advantage or Gap]

Helping You Prepare For Your Upcoming Medicare Enrollment
OneExchange Helping You Prepare For Your Upcoming Medicare Enrollment TOWERS WATSON

Transitions Can Be A Good Thing! OneExchange – For Your Benefit
Who We Are Transitions Can Be A Good Thing! OneExchange – For Your Benefit A Deeper Dive – Benefit Advisors, Private Exchange, Optimize Savings, Health Reimbursement for You Next Steps Questions & Answers 17

Transitioning from Employee to Retiree Healthcare Benefits
4/20/2017 Transitioning from Employee to Retiree Healthcare Benefits Access to retiree health benefits for Medicare-eligible retirees and their Medicare-eligible dependents is provided through OneExchange OneExchange was chosen after an extensive evaluation of choices OneExchange will help you with total care in your transition over to more-effective individual Medicare health insurance The private exchange offers greater choice and flexibility; many affordable choices exist and in many cases provide more value at a lower cost than an employer group plan Ongoing support – at no cost to you Click to add notes 2013 Towers Watson All rights reserved. Proprietary and Confidential. 18

About OneExchange Retiree
Towers Watson over 100 years experience Over 1-million retirees served across employers Licensed advisor provides guidance and ongoing advocacy Personalized options with plans from a nationwide network of carriers More Choice, More Flexibility – Better Value Founded in 2004 First and Largest private Medicare Exchange Our 10th annual enrollment season No fees for our service

Effortless Enrollment
4/20/2017 Why OneExchange? White-Glove Service Consultative Process Simplified Selection Effortless Enrollment Lifetime Advocacy Consultative Process: Your Benefit Advisor will determine coverage needs and thoroughly research your options Selection Process: Your Benefit Advisor will provide the guidance you need to easily understand your Medicare options Enrollment Process: 100% paperless, telephonic enrollment Secure and efficient Advocacy: Specialized and focused; trained in insurance, Medicare and issue resolution towerswatson.com 2013 Towers Watson All rights reserved. Proprietary and Confidential.

Our Service Centers Operating hours: Monday – Friday, 7:00 a.m. until 8:00 p.m. Central Time Salt Lake City, UT Dallas, TX 100% Domestic Workforce No Outsourcing!

All Medicare Plan Types
4/20/2017 Plans and Partners All Medicare Plan Types Prescription Drug (Part D) Medicare Advantage Medicare Supplement (Medigap) A few examples of the carriers on our Medicare exchange: Multiple plans available to you from national/regional carriers towerswatson.com 2013 Towers Watson All rights reserved. Proprietary and Confidential.

Your Experience Your total experience with OneExchange can be described in these 3 simple steps: You will receive announcement letters and brochures that provide information and education. Next you will meet with your Benefit Advisor who will help you evaluate your needs and wants, and then an application specialist will complete the telephonic enrollment with you. No need to wait for paper applications, nor the hassle of filling those out by hand. Finally, we provide ongoing communication and help when you need it.

Education Enrollment Guide
Prepare for your enrollment consultation Review Medicare basics TOLL FREE medicare.oneExchange.com/TCU Click to add notes 24 24

Decision Support Tools
4/20/2017 Decision Support Tools Help Me Choose Prescription Profiler medicare.oneExchange.com/TCU 24/7 access to your information 2013 Towers Watson All rights reserved. Proprietary and Confidential.

Benefit Advisors Licensed / Certified / Appointed
OneExchange University™ Average age 43 Objective & unbiased 100% domestic workforce Hours of Operation Monday – Friday 7 am – 8 pm CT You have heard me refer to a ‘Benefit Advisor’ several times already. I would like to introduce you to them, so you really understand who you are talking to, and what a valuable resource they are. Your Benefit Advisors are licensed health insurance agents. They are licensed in the state they live in, in your state, and many others as well. They are certified and appointed with each of those insurance carriers that we represent in your state, and they complete this certification each year. This keeps them current with the new plans and any changes. They also attend OneExchange University where they learn about Medicare—so they are Medicare experts! We’re the only private Medicare exchange whose training program is accredited by the Department of Insurance in the states where we have service centers. They are a wonderful resource for you and are available to you Monday through Friday 13 hours per day. One final, but equally important thing about our Benefit Advisors is they are neutrally compensated. What does that mean? They are not paid a commission. This keeps them objective and focused on you, on your needs, and on how you want your insurance to look and feel. There is no incentive for them to enroll you in one plan over another—other than wanting to satisfy the healthcare needs that you will identify for them. So they are truly unbiased.

Enrollment Process Benefit Advisors can discuss coverage options with anyone Telephonic enrollment – 2 part process 100% of calls are recorded I have mentioned several times that you will be talking to your Benefit Advisor over the phone. You can expect this consultation to last about an hour. For some, this is not good news because you may not be comfortable with phone conversations. The good news is this: you may have anyone on the phone with you or for you that you wish. You may assign someone to gather this information for you, and help you in the decision process. We don’t want you to be alone while making this important decision. If the person you wish to involve does not live near you, if you will call us, we can call them, and conduct a 3-way call. When you have made your plan selection, and are ready to complete the enrollment, that is the one time you do need to be on the phone. By law, it does need to be your voice that says, “yes this is the plan I wish to enroll in”, and you will need to state your name and date. You can even have help with that if needed! Some of you may have a Power of Attorney; this needs to be a Durable Power of Attorney for Medical enrollment decisions, this person can complete this process for you. You do need to be prepared to provide proof of durable POA to your new insurance company when they request it. 100% of our calls are recorded, for your protection.

Enrollment Confirmation Notice
Features: Sent once a participant has enrolled into a plan Confirms all plan selections and enrollments Carrier Name Plan Name Confirmation Number Premium Coverage Effective Date Whether or not they have selected Automatic Reimbursement What Happens Next Expectations on Carrier correspondence, including ID Cards Subsidy Packet Automatic Reimbursement Direct Deposit

MEDICARE ADVANTAGE + PD
4/20/2017 OPTION 1: Medicare Advantage Plan with Prescription Drug Coverage (MAPD)* MEDICARE ADVANTAGE + PD * Note that Medicare Advantage plans are generally network based plans 2013 Towers Watson All rights reserved. Proprietary and Confidential.

MEDIGAP PART D PLAN OPTION 2: Medigap Plan + Part D Plan
4/20/2017 OPTION 2: Medigap Plan + Part D Plan PART D PLAN MEDIGAP Note: You may need to pay your first premium when you enroll in coverage 2013 Towers Watson All rights reserved. Proprietary and Confidential.

MediGap – Lettered Plans

Medicare Prescription Drug Coverage 2015
You pay 45% of Brand Name and 65% of Generics until your out of pocket costs reach $4700; Pharmaceutical contributions will count towards the $4700 True Out Of Pocket costs You Pay Full Retail Until Deductible is Met $320 Initial Coverage Coverage Gap Catastrophic Coverage Deductible Only 25% reach Donut Hole Only 4% reach Catastrophic You pay copays for your plan coverage for the first $2960 in actual costs of Medications You Pay $2.65 for Generics and $6.60 for Brand Name or 5% - whichever is greater

How This Affects You What you pay How you enroll Your support
4/20/2017 How This Affects You Depends on the plan you choose Choose the right level of coverage for you and your spouse individually What you pay How you enroll You enroll directly through OneExchange You and your Medicare-eligible spouse enroll in separate plans Click to add notes Your support OneExchange will be your partner as you make this decision and enroll in plans OneExchange will provide ongoing support at no cost to you 2013 Towers Watson All rights reserved. Proprietary and Confidential. 33

Local Plan Slides

Plans Available in Tarrant County
Plan Type Number of Plans Offered 2015 Monthly Premium Carriers Medicare Advantage 17 $0 - $89 Coventry, Humana, AARP, Aetna, Scott & White, CIGNA Health Spring Medigap / Medicare Supplement 20 $75 - $339 AARP, Humana, BCBS of TX Loyal American by CIGNA Prescription Drug (Part D) 21 $16 - $152 AARP, Aetna, CIGNA, Humana Express Scripts, SilverScript, WellCare, Coventry, BCBS of TX

Plans Available in Dallas County
Plan Type Number of Plans Offered 2015 Monthly Premium Carriers Medicare Advantage 20 $0 - $166 Coventry, Humana, AARP, Aetna, Scott & White, CIGNA Health Spring Medigap / Medicare Supplement $75 - $339 AARP, Humana, BCBS of TX Loyal American by CIGNA Prescription Drug (Part D) 21 $16 - $152 AARP, Aetna, CIGNA, Humana Express Scripts, SilverScript, WellCare, Coventry, BCBS of TX

Medicare Advantage Plan
4/20/2017 Medicare Advantage Plan Benefit Cost Premium $30 Network PPO Deductible In Net: Some Services Out Net: $1000 Doctor Copay In Net: $ Out Net: $40 Specialist Copay In Net: $40 Out Net: $60 Hospital In Net: $400 copay per stay Out Net: 30% per cost stay Emergency Room $65 unless admitted to the hospital $0 Rx $0/ $4/ $40/ $80/ 33% day supply Mail Order $0/ $12/ $120/ $240/ 33% day supply 2015 2013 Towers Watson All rights reserved. Proprietary and Confidential.

Medigap Plan F + PDP (75 year old male)
4/20/2017 Medigap Plan F + PDP (75 year old male) Benefit Cost Premium $241 ($229 Medical + $21 PDP) Network Any doctor who accepts Medicare Deductible $0 Doctor Copay Specialist Copay Hospital Emergency Room Rx $8/ $8/ $37/ 47%/ 33% day supply Mail Order $20/ $20/ $92.50/ 47% day supply 2015 2013 Towers Watson All rights reserved. Proprietary and Confidential.

Health Reimbursement Arrangement (HRA)

4/20/2017 What Is An HRA? Tax-free account used to reimburse you for eligible health care expenses – you pay first and then get reimbursed If you are eligible, your former employer will make an annual contribution to a Health Reimbursement Account (HRA) You may use HRA funds to reimburse yourself for eligible medical expenses which include premiums that you pay coverage for (including Medicare Part B) and certain out-of-pocket expenses Your HRA funds will be available on the first of the month of your retirement, prorated for the year. On Jan 1st of the next year, you receive the full annual amount. TCU funds the Health Reimbursement Account at a rate equivalent to $ per month, per covered individual. The account is funded annually - $ per covered individual ($ for retiree and covered spouse). Funding prorated for the 1st of the month following retirement date. In the past, the total monthly premium for the group Medicare Companion plan was $ retiree paid $ per person and TCU paid $ per person. 2013 Towers Watson All rights reserved. Proprietary and Confidential. 40

Health Reimbursement Arrangement
If you are eligible, reimbursements are made up to the amount available in your HRA This visual really helps to understand how this works. You make your premium payment to your insurance company, or have an out of pocket expense. You then fill out a simple one page claim form and fax, scan, or mail it to OneExchange; attaching any applicable receipts. OneExchange will review it and reimburse you, either by check or direct deposit into your banking account.

Health Reimbursement Arrangement
Reimbursement Options 1. Automatic Reimbursement [including recurring claims] 2. Manual Reimbursement If you are eligible, reimbursements are made up to the amount available in your HRA You have two options for reimbursement: Automatic and Manual Automatic: You will enroll in a plan that provides this service, most of them do so just ask your BA to activate it for you. You THEN pay your premium directly to the insurance company, and the insurance carrier will send us a computer file each month indicating each premium payment. We will verify it and reimburse you without any paperwork. While this is by far the easiest way to be reimbursed, at the beginning it is not the fastest. Depending on the insurance carrier, there may be a 2 to 3 billing cycle delay in getting your reimbursement. Once we start getting these files, we get them within the same few-days window, so going forward it works just like clock work, however, you may need your reimbursement sooner. Simply file a paper claim for the first 2 months. Manual Claims: There are 2 types of manual claims, regular and recurring. The standard manual claim forms can be filled out and submitted as often as your needs require. You may submit them electronically, you may fax them, or simply mail them to us. Please be sure to attach the needed documentation and sign it. Recurring manual claims work best for those expenses that are consistent each month such as your part B premium. With this form, you will need to submit it once each year and we will reimburse you monthly for the requested amount. The necessary forms and instructions will be provided in your “Funding and Reimbursement Guide”. This will arrive just prior to you coverage start date.

Auto-Reimbursement (AR)
Service offered by OneExchange Available on most plans Works for premium reimbursement only No claim form is required Can take 2-3 billing cycles to initiate If you need your reimbursement sooner, simply file a paper claim. The form and instructions will be provided in your Funding and Reimbursement Guide

Next Steps

What You Need To Do: Action Required!
4/20/2017 What You Need To Do: Action Required! You MUST enroll in Medicare Part B if not already enrolled – contact the SSA Contact OneExchange at Make a first contact call now and schedule an enrollment appointment Enroll in your new coverage Call us during your scheduled appointment time You are guaranteed coverage Click to add notes 2013 Towers Watson All rights reserved. Proprietary and Confidential. 45

Personal Guidance: Ongoing Advocacy
Navigation Enrollment Claim issues Denied policies Affordability concerns Prescription Late enrollment HRA Annual plan review

Why OneExchange Retiree
People Objective and personal touch through stringent training processes and CMS compliance criteria Size and Strength 300 employers and 800,000 retirees being served Technology Most automated connections, across 90 carrier partners Satisfaction 99% client retention rate Average retiree satisfaction 9.2/10.0 Experience First and largest Medicare Exchange; private Relationship As life happens, we are here for you

Frequently Asked Questions
Q: Do you offer plans that cover me in multiple states-I am a snowbird? A: Medigap plans are accepted by every Medicare-participating provider in the U.S., with some emergency benefits worldwide. If you travel frequently or live part of the year out-of-state, these plans may be right for you. Part D plans provide nationwide coverage from participating pharmacies. Medicare Advantage plans cover urgent and emergency services nationwide, but some may not provide nationwide coverage for non-emergency services. If you live part of the year out-of-state, these plans may not be right for you. Q: How often will I be billed? By whom? Can I pay by check? A: When you enroll in a new plan, you will need to begin making premium payments to the insurance company in order to maintain your coverage. Some insurance companies may require the first month’s premium payment during the application process. In this case, you should expect to make a payment within a few days of your enrollment. Please have your billing information ready when you make your enrollment call to OneExchange. Most insurance companies give you several billing options for ongoing payments: direct billing, paid by check each month, Electronic Funds Transfer from your checking account, or automatic deduction from your social security check. You can choose to pay monthly, quarterly, or yearly.

Q: If I don’t like the plan that I enrolled in, when can I change? A: Every year you will have a Medicare Annual Enrollment Period during which you may investigate other medical and drug plans and potentially enroll in a different plan. However, during future Medicare Annual Enrollment Periods your medical conditions at that time may limit the plans available to you. You will receive notification from OneExchange of the Medicare Annual Enrollment Period (October 15-December 7); we encourage you to contact us should you have any questions. Q: Will I be refused coverage due to a pre-existing condition? Will I pay more? Can my policy be cancelled once I am enrolled because of my condition? Can my rate be raised for that reason? A: If you enroll in a Medigap plan when you first transition from group coverage you have guaranteed issue rights – no questions about pre-existing medical conditions may be asked. If you later change Medigap plans in the future, you MAY go through Medical underwriting. You will not necessarily be denied, but your monthly premiums could be higher. Your policy is always ‘guaranteed renewable’ – meaning you cannot be cancelled once you are enrolled unless you do not pay your premiums and your rate will not be raised for medical reasons. If you enroll in a Medicare Advantage plan, they are always guaranteed issue with no questions of pre-existing medical conditions.

4/20/2017 Frequently Asked Questions Q: I re-married after I retired—is my spouse eligible for OneExchange’s services? A: Yes. OneExchange can assist you with individual plan coverage consultation but you will not be eligible for the program subsidy. Q: Will my premium rates increase every year? If so, by how much? A: In general, insurance premiums do increase every year. The increase in plan cost year-to-year can vary widely. We advise our enrollees to contact us and compare other plans if you experience rate increases in the 10-15% range. The national average is 3-4%. Q: Are there plans that will cover me when I travel domestically or internationally? A: Medigap plans are accepted by every Medicare-participating provider in the U.S., with some emergency benefits worldwide. If you travel frequently or live part of the year out-of-state, these plans may be right for you. A few Medicare Advantage plans also have world wide emergency coverage. 2013 Towers Watson All rights reserved. Proprietary and Confidential.

We Are Ready For Your Call

Post-65 Coverage Options
Original Medicare- FFS (Fee For Service) MA-PD OR Part A Hospital Institutional Part B Doctors Supplies Outpatient Professional Medicare Advantage (MA) + Part D Drugs PFFS PPO HMO Added Optional Coverage Medicare Supplement (Medigap Plans) Fills in Medicare payment “gaps” in coverage + Part D Drugs (Stand Alone) 52

Retiree Readiness Helping You Transition to Supplemental Medicare Insurance.

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