Office of Group Benefits Annual Enrollment 2012

1. Office of Group Benefits Annual Enrollment 2012 FOR RETIREES WITH MEDICARE PART A & PART B

2. Welcome This presentation is a summary of information and does not purport to present complete details of all plan options offered by the Office of Group Benefits. For complete information on each plan option, individuals should read plan documents carefully and also consult other OGB and plan administrators’ publications.

3. Welcome This presentation will cover: • Ways to Save • Eligibility • Overview of Health Plans • Life Insurance

4. Office of Group Benefits OGB serves state agencies, universities and school boards Prescription Drug Benefits 21.9% Administrative Costs 3.5% Mental Health Benefits 1% Medical Benefits 71.4% Life Insurance 2.2% OGB’s administrative costs are only 3.5% of total costs (June 30, 2011)

5. Annual Enrollment Timeline Annual Enrollment begins 2012 plan year begins Annual Enrollment ends

6. Ways to Save

7. Your Health: Our Priority6 Ways to Save • Choose the right health plan for you • Out-of-state coverage differs by plan • Out-of-state dependent? Job transfer? Travel? • Are your providers in the plan’s network? • All plans accessible through OGB website www.groupbenefits.org 1 2 • Stay in your health plan’s provider network • Avoid balance-billing 3 • Request generic drugs • Same active ingredients and big savings

8. Your Health: Our Priority6 Ways to Save • Get preventive (wellness) exams • Prevention • Early diagnosis 4 5 6 After you fill your prescriptions for diabetes medication, use your prescription drug benefit on the same day to receive free diabetes testing supplies • Give providers complete, accurate information about your health • Get correct diagnosis and treatment • Ensure timely and correct payments

9. Prescription Cost Comparison

10. Premium Cost-Saving Strategies Married Couples If both are state or schoolretirees... • Both eligible? • May save if split coverage

11. Eligibility

12. Eligibility – Same for All Plans Full-Time Employees and Dependents • Legal spouse Louisiana does not recognize same-sex marriages regardless of other states’ laws • Children up to age 26 – regardless of child’s student, marital or tax status No one can be enrolled simultaneously as both an employee and a dependent in OGB health plans or life insurance No dependent can be covered by more than one employee Dependent verification required

13. Eligibility – Children • Natural child of you or your legal spouse • Legally adopted child • Child placed in home for adoption • Child in home under legal guardianship or custody • Grandchild dependent on you whose parent is your covered dependent

14. Dependent Verification • Plan member must provide proof of the legal relationship of each dependent within 30 days of date of application for coverage • Proof: Official documents • Marriage certificate • Birth certificate • Other court records or legal documents

15. Over-Age Dependents Covered child under age 26 who is or becomes incapable of self-sustaining employment is eligible to continue coverage as an overage dependent • OGB must receive required medical records before dependent reaches age 26 • Definition of incapacity broadened – now includes both mental and physical incapacity

16. Pre-Existing Condition Limitation for Late Applicants Must complete enrollment form (GB-01) within 30 days for new dependent … otherwise, pre-existing condition limitation (PEC) applies • If diagnosed or treated within 6 months prior to enrollment date, condition is pre-existing ... no benefits are payable for that condition in first 12 months of coverage • PEC limitation does not apply to anyone under age 19 • May be exempt from pre-existing condition limitation if continuously covered without 63-day break in coverage prior to enrollment date

17. What Happens If You Drop Coverage? If you drop coverage, you lose it FOREVER!

18. UNLESS … • You joined a non-OGB Medicare Advantage plan and it is no longer available or you withdraw • You joined TriCare for Life and it is discontinued or had significant reduction in benefits • You lost other creditable continuous coverage and you meet all requirements in PPO Plan Document

19. Medicare Facts to Remember Medicare Part A and Part B • OGB health plans are secondary to Medicare • Premium rates are reduced for retirees with Medicare • Provider accepts Medicare assignment? • Yes:Neither OGB nor patient is responsible for • charges above Medicare-allowable amount • No:OGB will consider remaining eligible charges

20. Medicare and OGB Coverage If you reached age 65 on or after July 1, 2005, AND are retired AND are eligible for Medicare Part A premium-free, then… • You MUST enroll in Medicare Part B to receive OGB health plan benefits for medical expenses covered by Medicare Part B • You must submit Social Security verification to OGB: • If eligible – submit copy of Medicare card • If not eligible – submit letter from Social Security This also applies to your covered spouse If you are not yet retired, this will apply when you retire

21. Overview of Health Plans

22. OGB Health Plans for All Retirees

23. Key Points • Can change health plans during Annual Enrollment • Compare costs, benefits and restrictions when choosing a plan • Retirees who choose to keep the same plan do not need to fill out an enrollment form

24. Key Points Retirees who want to change plans must… • Fill out an OGB enrollment form … or • Write a letter to OGB that includes: • Your plan choice • Your name and address • Your date of birth • Your daytime phone number • Sign form or letter and mail it to ... OGB Eligibility Division P.O. Box 66678 Baton Rouge, LA 70896 ... or visit any OGB Agency Services office

25. Providers? Restrictions? • For PPO plan members with Medicare Parts A and B: • In-network and out-of-network benefits are the same, except … • The inpatient deductible is waived for in-patient stays at network hospitals • To access HMO in-network benefits, plan members must use network providers A provider directory for each OGB health plan is available on the website…www.groupbenefits.org *

26. Plan Overview ...Plan Member Out-of-Pocket Expenses

27. Plan Overview ... Plan Member Out-of-Pocket Expenses

28. Plan Overview …Plan Member Out-of-Pocket Expenses * Plan member may owe deductible, co-payment, co-insurance and balance of billed charges

29. Mental Health & Substance Abuse Treatment Benefit 1 Subject to plan year deductible and/or co-insurance 2Pre-authorization required

30. Prescription Drug BenefitPPO and HMO (Administered by Medco and Catalyst Rx) * OGB’s open formulary means all FDA-approved prescription drugs that are currently covered will continue to be covered in 2012

31. Prescription Drug BenefitRegional HMO (Administered by VHP’s Catalyst Rx) *Prescription drugs not on Vantage’s formulary list may be available at higher out-of-pocket cost

32. Prescription Drug BenefitMedical Home HMO (Administered by VHP’s Catalyst Rx) *Prescription drugs not on Vantage’s formulary list may be available at higher out-of-pocket cost

33. Prescription Drug BenefitPPO and HMO Plan Members with Medicare Only • Effective January 1, 2012 … • OGB will transition to an Employer Group Waiver Plan (EGWP) Medicare Part D prescription drug plan – plus wrap-around coverage for medications not included in the Medicare D plan • FDA-approved prescription drugs that are now covered will continue to be covered in 2012 • Applies to retirees (and covered spouses) who … • Have Medicare Part A and/or Part B coverage; and • Are enrolled in OGB’s standard PPO or HMO health plans

34. Prescription Drug BenefitPPO and HMO Plan Members with Medicare Only • Effective January 1, 2012 … • OGB will enroll you in new Medicare Part D prescription drug plan and wrap-around drug coverage automatically – at no additional cost to you • The current retiree drug subsidy (RDS) is being phased out • The transition will enable OGB to receive new federal EGWP subsidy for providing Medicare Part D prescription drug coverage to retired OGB plan members with Medicare • The EGWP subsidy will help OGB offset rising health care costs … this helps OGB keep premiums as low as possible

35. Prescription Drug BenefitPPO and HMO Plan Members with Medicare Only • Before December 1, 2011 … • You will receive letters and information by mail (from OGB, Medco and Catalyst Rx)about the effects of the transition – if any – on your OGB prescription drug benefits • Be sure to read – and save – this information!

36. Prescription Drug BenefitPPO and HMO Plan Members with Medicare Only • Effective January 1, 2012 … • No change in plan member prescription co-payment (50% of drug cost to $50 maximum) – for 31-day supply • Same $1,200 plan member out-of-pocket maximum; after maximum, co-pay still $15 brand-name drug, $0 generic • No change in retail pharmacy network • Drug formulary remains open • Continued coverage for FDA-approved prescription drugs now covered by Catalyst Rx • Coverage for some drugs previously not covered

37. Prescription Drug BenefitPPO and HMO Plan Members with Medicare Only • Effective January 1, 2012 … • Fill limits increased to 31/62/93 days(now 30/60/90 days) • Can buy 93-day fill at retail pharmacy – no 31-day wait • Quantity limits may vary • Prescriptions that now require prior authorization may require re-authorization – no transfers (required by CMS) • Can continue to get free testing supplies by mail or at any network pharmacy when you fill diabetes prescription (insulin or oral medication)

38. Prescription Drug BenefitPPO and HMO Plan Members with Medicare Only • Effective January 1, 2012 … • If your annual income is less than … • $16,335 as an individual, or • $22,065 for a family of 2 • … you may qualify for a Medicare subsidy that reduces your co-payment • This means your out-of-pocket expenses for prescription drugs may be lower

39. Prescription Drug BenefitPPO and HMO Plan Members with Medicare Only • Effective January 1, 2012 … • You will have 2 separate ID cards … • You will receive a new ID card from Medco for each plan member with Medicare – for prescription benefits for that person only • Medco (in partnership with Catalyst Rx) will administer your Medicare Part D prescription drug coverage and wrap-around coverage • You will continue to use your health plan ID card – for all other medical benefits for all plan members with Medicare • If you change health plans during Annual Enrollment, you will receive a new OGB health plan ID card • If you do not change health plans during Annual Enrollment, you will continue to use your current OGB health plan ID card

40. IMPORTANT Reminder # 1PPO and HMO Plan Members with Medicare Only • The information you receive by mail (from OGB, Medco and Catalyst Rx) before December 1 will … • Include more details about OGB’s EGWP Medicare Part D prescription drug plan and wrap-around coverage • Offer you a chance to “opt out” of OGB’s Medicare Part D drug coverage – as required by CMS (the federal Centers for Medicare and Medicaid Services) – but • OGB strongly recommends that you DO NOT OPT OUT! • If you opt out of OGB’s Medicare Part D coverage, you also opt out of ALL of your OGB health and prescription drug coverage -- FOREVER!

41. IMPORTANT Reminder # 2PPO and HMO Plan Members with Medicare Only After you are automatically enrolled in OGB’s Medicare Part D prescription plan, DO NOT purchase or enroll in … • An individual Medicare Advantage plan • A group Medicare Advantage plan not sponsored by OGB • Another Medicare Part D plan for drug coverage only • because …

42. IMPORTANT Reminder # 2 (continued)PPO and HMO Plan Members with Medicare Only • Each person can be enrolled in only ONE Medicare-type plan • Signing up for ANY individual Medicare-type plan cancels your current OGB coverage – and could leave you without OGB health and prescription coverage! • If a husband and wife currently have dual coverage, each must now choose ONE plan based on his or her own health situation

43. Retiree 100 – PPO Plan Members • Optional coverage available to retired plan members who have Medicare Part A and Part B as primary health coverage • May provide higher reimbursements for eligible medical expenses after deductibles are met • Considers total charges billed by eligible provider, not just balance due after Medicare has paid • Additional premium – $39 per person per month

44. Sources of Information OGB Website– www.groupbenefits.org Plan Comparison & Premium Rates Annual Enrollment Materials Agency Human Resources Office OGB Agency Services Offices

45. Your Health: Our Priority The OGB website… • www.groupbenefits.org ….offers links to a current provider directory for each health plan — accessible any time • Go to the OGB home page • Click on the Health Plans link to access a • searchable list of network providers (and other • information) for each OGB health plan

46. Life Insurance

47. Life Insurance Prudential Insurance Co. of America • Group term life insurance plan • State pays half of premium for employees and retirees • Employee pays full premium for dependent life insurance • 25% reduction in coverage and appropriate reduction in premiums on July 1 after plan member reaches age 65 and age 70

48. Life Insurance

49. Life Insurance

50. Life Insurance • Accidental Death and Dismemberment (AD&D) benefits available to all active and retired employee covered under Basic or Basic Plus plan • Retirees over age 70 not eligible for AD&D • ALL inquiries and changes in life insurance must be made through your agency’s HR department