1. BENEFITS OPEN ENROLLMENT UPDATES 2005

2. OPEN ENROLLMENT November 1 st through November 30th Changes to your medical, dental, life insurance Participation in the FSA program for 2005 If you are not making changes, no forms need to be completed during open enrollment Changes effective January 1, 2005 DEADLINE: November 30, 2004

3. LIFE INSURANCE All employees receive basic life insurance equal to 1X base salary up to $150,000. Effective January 1, 2005: –Total basic and supplemental insurance is increasing from $450,000 to $750,000; –Elect 1X, 2X or 3X your basic; –Evidence of insurability is required if increasing more than one level; –Rates are guaranteed through June 30, 2005

4. DEPENDENT LIFE INSURANCE New voluntary benefit offering Effective January 1, 2005 Coverage: –Spouse/domestic partner - $10,000 –Children from 1 to age 19 (23 if full time student) - $5,000 –Children from 14 days to 1 year - $500 Cost: $1.62/paycheck –Rate is the same if covering a spouse or a spouse with children; –Evidence of insurability is not required during this initial enrollment

5. FLEX CONVENIENCE CARD Enhancement to FSAs and Commuter Reimbursement Programs effective January 1, 2005 FSA’s - $8,000 for Health Care; $5,000 for dependent care Reimburse yourself with tax-free dollars for health and dental care expenses for you and your spouse not reimbursed under the medical or dental plan (e.g., co-payments, deductibles) MasterCard debit card saves you time and money –Utilize at authorized merchants to pay for eligible health care and dependent care expenses; –FSA is debited by the amount of the expense and the provider is paid directly from your FSA funds; –You no longer have to complete a claim and wait for a reimbursement check; –STILL MUST KEEP YOUR RECEIPTS SINCE THIS IS STILL GOVERNED BY THE IRS.

6. FLEX CONVENIENCE CARD Reimburse yourself with tax-free dollars for commuting and parking expenses for yourself only to commute and/or park for employment purposes; $100/month for commuting; $195/month for parking MasterCard debit card saves you time and money –Utilize at authorized merchants to pay for eligible commuting and parking expenses; –Account is debited by the amount of the expense and the provider is paid directly from your available funds; –You no longer have to complete a claim and wait for a reimbursement check; –STILL MUST KEEP YOUR RECEIPTS SINCE THIS IS STILL GOVERNED BY THE IRS. –If you utilize the debit card, can also set aside money on an after-tax basis – (this feature is not available if you reimburse yourself through the claims process

7. SUPPLEMENTAL RETIREMENT CONTRIBUTIONS For 2005 can contribute up to $14,000 Additional catch up contributions: –$4,000 if age 50 or over –$3,000 if employed full time 15 or more years Must verify with TIAA-CREF to determine eligibility Separate package being sent interoffice If you are changing your contribution for 2005, must submit forms by November 30, 2004; Changes are effective January 1, 2005 If you wish to continue your current contribution, no additional paperwork is needed

8. DENTAL PLAN Delta Care NY and NJ – premiums are not increasing in 2005; rates have remained status quo since implementing with Delta Dental in 2002. Delta Dental POS –Premiums increasing 9% from negotiated 25% –Individual coverage - $10.42/paycheck – pre- tax savings

9. Review of Medical Plan Changes Effective January 1, 2004 Increased co-payments from $10 to $15 with subsequent $5 increases every 4 years; Implemented a three tier Rx program at $10/$20/$30 with subsequent $5 increases every 5 years; Implemented a premium cost sharing for individual coverage based upon an inflation- indexed formula for employees hired prior to January 1, 2004 Implemented a 15% premium cost sharing for individual coverage for employees hired after December 31, 2003

10. Medical Plan Premiums Effective January 1, 2004, participants in the following HMOs were contributing towards individual coverage: –HealthNet HMO- Aetna NY HMO –Blue Cross/- HIP of NY HMO Blue Shield HMO Contributions for individual coverage ranged from $1.22/paycheck to $4.89/paycheck Only applicable to employees hired prior to January 1,2004; Employees participating in Oxford HMO and HealthNet POS were not contributing to individual coverage since the premium decreased due to the changes made to medical service co-payments and the implementation of a three tier Rx structure

11. Medical Plan Premiums Inflation-indexed formula is: –Current monthly University premium contribution for individual coverage + Consumer Price Index (CPI-U) + 50% of the medical plan increase over CPI. –The CPI-U for September 2004 for NY/NJ/CT was 3.2%.

12. Medical Plan Premiums 2004 HealthNet POS Premium $456.82 HealthNet POS Premium $500.82 Premium Increase 9.5% Increase over CPI: 9.5% - 3.2% = 6.3% 50% of Increase over CPI 6.3% * 50% = 3.15% University Increase Share 3.2%+ 3.15% = 6.35% Employee Share: 9.5% - 6.35% = 3.15% 2005 University Monthly Contribution: $456.82 + 6.35% = $485.83 per month 2005 Employee Monthly Contribution: $500.22 - $485.83 = $14.39 per month or $7.19/paycheck

13. Medical Plan Premiums Employee Pre-tax Deduction Per Pay Period for Individual Medical Coverage: –Aetna New York HMO: $10.93 –Blue Cross Blue Shield HMO: $10.81 –HealthNet HMO: $9.62 –HIP of New York HMO: $9.06 –Oxford HMO: $4.18 –HealthNet POS: $7.19 Contributions are withheld before taxes; Can save up to $43 in federal taxes; University is continuing its commitment towards 65% contribution for family coverage; –HealthNet POS Employee + 1 = $161.32; Family Coverage = $218.84

14. Open Enrollment November 1 st through November 30 th Last “paper” election Will receive an email acknowledgement when forms are received and an additional confirmation when forms are processed Drop off enrollment boxes are at each campus November 30, 2004 Contact University Benefits at X22763 or e-mail, benefits@pace.edu

15. QUESTIONS