Benefits Overview Tier 2 The information contained in these slides is intended to be a summary only. Please refer to the Summary Plan Description and/or insurance certificates for detailed information. January 14, 2013

Benefit Carriers BC/BS of Michigan-Simply Blue PPO Medical/Prescription coverage BC/BS of Michigan Dental coverage BC/BS (VSP) of Michigan Vision coverage Lincoln Financial Group Life and AD&D, LTD, STD, and Accident Insurance HelpNet Employee Assistance Program

Deadlines Benefit Elections must be made within 30 days of your date of hire. Dependent certification is due within 30 days of your date of hire Benefit Elections go into effect on your 31st day of employment.

Documentation Proper documentation is needed for all eligible dependents that you would like to cover on the medical & prescription, dental or vision plan. Copies are accepted and can be faxed or emailed to human resources. Child (Children can be covered until the day before their 26th birthday.) Birth Certification or Adoption order or court document showing relationship. Spouse (2 documents needed) Marriage Certificate Proof of current marriage (last year’s tax return or recent bill coming to your name and spouse’s name at same address.

Premium Costs for Medical and Prescription Insurance Single coverage = No cost to the employee 2-Person coverage = $210.76/bi-weekly Family coverage = $301.08/bi-weekly *Premiums are based on 24 pays

Medical Deductible with BCBS Single = $1,250 Family = $2,500 KRESA will be depositing a pro-rated amount of the single coverage deductible into your Health Savings Account (H.S.A.) *This amount is pro-rated based on your start date after January 1, 2013

No Office Visit Co-pays! Medical Plan Overview Ability to choose in-network or out-of-network care for medical services or supplies Choose in-network whenever possible as cost will be cheaper All medical and RX expenses go towards the deductible Once deductible is met your medical expenses are covered at 100% (Rx subject to copay $10/$40/$80 In Network Out-of-Network Deductible In & out of network does not cross accumulate $1,250 per member $2,500 for family $2,500/$5,000 Co-Insurance 100% 80% Office Visit 80% after deductible Urgent Care ER Visit (waived if admitted) % Co-Insurance % Co-Insurance Maximum Does not Include Deductible $1,000 per member $2,000/family $2,000/4,000 Your Benefits-at-a-Glance enclosed in your Open Enrollment booklet go into more details regarding the benefits of each of the 3 plan offerings. The information on the slide is a high level overview of some of the highlights of these plans. Review slide. No Office Visit Co-pays!

Preventive Services Covered at 100% Medical Plan Overview Preventive Care Services (generally one per calendar year) In Network Out-of-Network Health maintenance exam, includes chest x-ray, EKG, cholesterol screening and other lab procedures Covered 100% N/A Gynecological exam Pap smear—lab and pathology Well-baby & child care (see multiple visit limits by age) Mammography screening Immunizations-pediatric & adult Preventive Services Covered at 100% Your Benefits-at-a-Glance enclosed in your Open Enrollment booklet go into more details regarding the benefits of each of the 3 plan offerings. The information on the slide is a high level overview of some of the highlights of these plans. Review slide.

Medical Plan Overview Other covered services In Network Out-of-Network Allergy testing and therapy 100% after deductible 80% after deductible Chiropractic manipulation--12 visits per year Outpatient physical, speech and occupational therapy-- 30 combined visits per year Your Benefits-at-a-Glance enclosed in your Open Enrollment booklet go into more details regarding the benefits of each of the 3 plan offerings. The information on the slide is a high level overview of some of the highlights of these plans. Review slide. No Pre-existing Conditions No Lifetime Maximums

Prescription Plan Overview Cost of Prescription Applied to the Deductible Once Deductible Met – Copay’s Apply Once Copay’s Accumulate to the Out of Pocket Maximum $1,000 Single / $2,000 Family plan pays 100% Step Therapy Prescription Drug Coverage In-Network Benefits (up to a 30 day supply) $10 (or less) co-pay: Generic $40 co-pay: Formulary (Preferred) Brand Name drugs $80 Non-Formulary (Non-Preferred) Brand Name drugs Oral and Injectable contraceptives – covered with applicable copay Applicable co-pay applies for elective drugs, i.e. infertility, weight loss & sexual impotency Rx formulary can be found BCBSM web site on www.bcbsm.com and has also been placed on the KRESA internal employee web site Member uses the same card for med/surg and pharmacy both in and out of MI Same Rx plan regardless of which medical plan you enroll in

Prescription Plan Overview Mail Order Mail Order: Prescription Drug Coverage In-Network Benefits home delivery for a 31 to 90 day supply Prescription Drugs will be subject to the following co-pay once the Single / Family deductible has been met Generic drugs – $20 co-pay Formulary drugs - $80 co-pay Non formulary drugs $160 co-pay Your plan also offers a retail 90 benefit. Members are able to obtain a 90 day supply of medication from a participating retail pharmacy. The Retail-90 program offers you the same financial incentive as the mail-order program (buy 2 get 1 free). MOPD2x Retail-90-2x Go to website to find participating retail-90 pharmacies ( we will also have a list with us to reference). Review slide

Dental Plan Overview Class I services - 25% of approved amount Member’s responsibility (co-pays and dollar maximums) Can use both provider networks (Dental Network of America or Traditonal Plus) found on BCBSM web site. Dollar maximums Annual maximum (for Class I, II and III services) $1,000 per member Lifetime maximum (for Class IV services) $1,500 per member Class 1: oral exams and xrays Class 2: Fillings/crowns Class 3 Bridges Class 4: Orthodontics for children up to age 19 **Can use HSA dollars but does not go towards your medical deductible. Class I services - 25% of approved amount Class II services - 25% of approved amount Class III services - 50% of approved amount Class IV services - 50% of approved amount **Review your Dental summary for specific services

Premium Costs for Dental Insurance Single coverage = No cost to the employee 2-Person coverage = $18.41/bi-weekly Family coverage = $26.30/bi-weekly *Premiums are based on 24 pays

Blue Vision SM Choice with VSP Annual Vision Exam - $10 Lenses & Frames - $25 copay Lenses every 12 months Frames every 12 months Contact Lenses - $25 copay Medically necessary Elective $130 allowance 12 months VSP (Vision Service Plan Network) Discounts on additional pairs of prescription and nonprescription glasses, including sunglasses Laser VisionCareSM program Discounts on LASIK and PRK 15% off or 5% off promotional offers .

Premium Costs for Vision Insurance Single coverage = No cost to the employee 2-Person coverage = $3.82/bi-weekly Family coverage = $5.45/bi-weekly *Premiums are based on 24 pays

Flexible Spending Account Dependent Care FSAs give you a convenient way to pay for eligible healthcare and/or day care (child and adult) expenses Set aside pre-tax dollars through convenient payroll deductions Use your debit card for eligible expenses Save money on taxes Contribute $100 - $5,000 If you do not use it you do lose it HSAs are tax-advantaged savings accounts available to individuals who have a high-deductible health plan and no other first-dollar medical insurance coverage. Money contributed by an employer or employee (or both) to an HSA that is used to pay for qualified medical expenses is not taxable. The amount of money contributed to the HSA, which is capped annually, may be contributed directly or deducted from the accountholder’s individual or family federal tax return. Contributions to HSAs not spent on qualified medical expenses may be rolled over from year to year. Employer contributions are not subject to payroll taxes - After-tax employee contributions are tax deductible from gross income. - Pre-tax contributions can be made through payroll deduction and are not subject to Federal income tax, Social Security or (in most cases) state taxes. May be combined with limited purpose HRA, limited purpose FSA and dependent care FSA BCBSM does not automatically send claims for reimbursement for groups with a HSAs only BCBSM will send eligibility files

Health Savings Accounts (HSAs) – Health Equity Health Savings Accounts – What Is It? Tax-advantaged savings accounts available to individuals who have a high deductible health plan and no other first dollar medical coverage Contributions can be made by employer, employee, employer and employee and/or third party You can stop or start contributing at any point in time. KRESA will be depositing this amount into your Health Savings Account (H.S.A.) This amount is pro-rated based on your start date after January 1, 2013 HSAs are tax-advantaged savings accounts available to individuals who have a high-deductible health plan and no other first-dollar medical insurance coverage. Money contributed by an employer or employee (or both) to an HSA that is used to pay for qualified medical expenses is not taxable. The amount of money contributed to the HSA, which is capped annually, may be contributed directly or deducted from the accountholder’s individual or family federal tax return. Contributions to HSAs not spent on qualified medical expenses may be rolled over from year to year. Employer contributions are not subject to payroll taxes - After-tax employee contributions are tax deductible from gross income. - Pre-tax contributions can be made through payroll deduction and are not subject to Federal income tax, Social Security or (in most cases) state taxes. May be combined with limited purpose HRA, limited purpose FSA and dependent care FSA BCBSM does not automatically send claims for reimbursement for groups with a HSAs only BCBSM will send eligibility files 2013 Maximum Contributions: Single $3250** Family $6450** ** Includes KRESA employer contribution

What are the advantages of an HSA? Flexibility You can use the funds in your account to pay for current medical expenses, including expenses that your insurance may not cover, or save the money in your account for future needs, such as: Health insurance or medical expenses if unemployed Medical expenses after retirement (before Medicare) Out-of-pocket expenses when covered by Medicare Long-term care expenses and insurance Savings You can save the money in your account for future medical expenses and grow your account through investment earnings. Portability Accounts are completely portable, meaning you can keep your HSA even if you: Change jobs Change your medical coverage Become unemployed Move to another state Change your marital status

What are the advantages of an HSA? Ownership Funds in your HSA belong to you and are always 100% vested. Unlike other medical spending accounts HSA funds can remain in the account year to year. There are no “use it or lose it” rules for HSAs. Tax Savings Contributions to your HSA can be made on a pre-tax basis. HSA earnings grow tax-free and, as long as the funds are used for qualified medical expenses, withdrawals from your HSA are also tax-free. If you spend any of your HSA money on non-qualified medical expenses prior to age 65, you will pay ordinary income tax on those funds and will have to pay a 20% IRS penalty.

Who is NOT eligible for an HSA? Examples of “1st dollar” medical benefits that make someone ineligible for an H.S.A. per IRS guidelines *Medicare SSID (social security disability insurance) Tricare Coverage Full Medical Flexible Spending Arrangements (HRA) Adult Children – that do not qualify as a your tax dependent (IRS Publication 502) Covered by a spouses FSA or HRA plan (you cannot have an HSA if you are covered by your spouses plan that can pay for any of your medical expenses with an FSA or HRA before your HSA health plans deductible is met) *If an eligible person isn’t enrolled in Medicare, even though that individual has reached age 65, the person can contribute to an HSA until the month they enroll in Medicare. Also can contribute “catch up” contributions until enrolled in Medicare. (you can continue to use your HSA care expenses, but you can no longer make contributions to your HSA savings account)

Member Portal Be sure to add a beneficiary to your account! View balance Review account activity Transfer HSA funds Pay bills online View Insurance Information Online account statements Online tutorials Online support links Calculators Forms Member Portal Be sure to add a beneficiary to your account! **You will receive a welcome kit along with your debit card shortly after your benefits begin.

Accessing Funds Funds from the spending accounts are disbursed in the following ways: Debit card Online bill payment Online reimbursement 2 Debit Cards

Lincoln Financial Group

Lincoln Financial Group 24 Lincoln Financial Group Employer Paid Life Insurance Employer Paid Long Term Disability Voluntary Life Insurance Voluntary AD&D Insurance Voluntary Short Term Disability Voluntary Accident Plan Benefit Lincoln Accident Insurance pays a cash, lump sum directly to you for accidental injuries to help cover direct (deductibles; co-insurance; prescriptions; bandages; follow-up visits, including doctor’s visits and physical therapy) and indirect (lost wages, property damages (auto deductible), lodging and transportation) costs associated with accidental injuries.

Employer Paid Life and Long Term Disability 25 Employer Paid Life and Long Term Disability Life Insurance Benefit $20,000 Employee Term Life Insurance Long Term Disability Benefit 60% of your wages + 10% progressive Income benefit 70% total income benefit up to $6000/month Benefit begins on 91st day Lincoln Accident Insurance pays a cash, lump sum directly to you for accidental injuries to help cover direct (deductibles; co-insurance; prescriptions; bandages; follow-up visits, including doctor’s visits and physical therapy) and indirect (lost wages, property damages (auto deductible), lodging and transportation) costs associated with accidental injuries. The 10% progressive is if you lose 2 or more of your daily life functions like eating and bathing.

Employee Voluntary Coverage Options 26 Employee Voluntary Coverage Options Voluntary Life Insurance Employee - $10K increments up to 5x salary - $500k max Spouse - $5K increments up to 2.5x emp salary - $250k max Dependent Children – 4 options - $2500 $5000 $7,500 $10,000 Guaranteed issue amount is $140,000 for employees and $25,000 for a spouse Voluntary AD&D Insurance Employee - $10k increments but no more than 5x salary Spouse - $5k increments up to 100% of employee election Dep Children - $2k increments up to $10,000 Voluntary Short Term Disability Benefit 60% of your wages min $100/wk – max $1,200/wk Begins 1st day accident / 8th day of Illness Benefit duration is 13 weeks Lincoln Accident Insurance pays a cash, lump sum directly to you for accidental injuries to help cover direct (deductibles; co-insurance; prescriptions; bandages; follow-up visits, including doctor’s visits and physical therapy) and indirect (lost wages, property damages (auto deductible), lodging and transportation) costs associated with accidental injuries. Can only elect Accident insurance during open enrollment.

Employee Assistance Plan HelpNet FREE to you and anyone living in the same household Savings Center Work/Life Balance Trainings/Development Financial Resources Strictly confidential Limited counseling services Addictions Emotional Problems Legal and financial concerns Careers Relationships Stress, Anxiety and depression Aging Parents Marital and family issues

Wellness Wellness at KRESA Wellness Committee Ways to get involved The wellness committee exists to raise awareness of our wellness program as well as create opportunities for our colleagues to learn about and live a healthier lifestyle. We feel that the health and well-being of our employees is a high priority. People who are healthy tend to lead happier lives and that includes being more engaged at work. As an added benefit it has also been shown that implementing a wellness program and encouraging healthier living will decrease healthcare costs over time

What needs to be COMPLETED? Enrollment Form Lincoln Beneficiary Form Lincoln Evidence of Insurability If electing over the guaranteed issuing amount

QUESTIONS AND ANSWERS