2016 MEDICAL PLAN · (i) Usual means the fee usually charged to his other private patients for a...

PAULO PRODUCTS COMPANY MEDICAL PLAN

Effective Date April 1, 1992

Amended January 1, 2016

HRShare\Benefits\MEDICAL\2016\Medical Plan

TABLE OF CONTENTS PAGE

ARTICLE I. DEFINITIONS ............................................................................................... 2 - 10 ARTICLE II. ELIGIBILITY AND TERMINATION ....................................................... 11 - 13

Contribution Basis–Personal Coverage .................................................................. 11 Individual Eligibility .............................................................................................. 11 Effective Date of Personal Coverage ...................................................................... 11 Enrollment After Effective Date ............................................................................. 11 Termination of Personal Coverage ......................................................................... 12 Eligibility for Dependent Coverage ........................................................................ 12 Contribution Basis–Dependent Coverage ............................................................... 12 Effective Date of Dependent Coverage ................................................................... 13 Addition of Eligible Dependents ............................................................................. 13 Termination of Dependent Coverage ...................................................................... 13

ARTICLE III. CONTINUATION COVERAGE ................................................................ 14 - 17

Continuation Coverage Provision .................................................................... 14 - 17 ARTICLE IV. SCHEDULE OF BENEFITS....................................................................... 18 - 21

Deductible Amount ............................................................................................... 18 Out-of-Pocket Maximums .............................................................................. 18 - 19 Covered Portion ............................................................................................. 19 - 20 Maximum Benefits ................................................................................................ 20 Pregnancy Expense ............................................................................................... 20 Surgical Expense ............................................................................................ 20 - 21 Limitations to Benefits for Temporomandibular Joint Syndrome ............................. 21 Limitations to Benefits for Chiropractic Services ................................................... 21 Second Surgical Opinion ....................................................................................... 21 Benefits in Connection with Certain Mastectomies ................................................. 21 Emergency Services ............................................................................................. 21 Primary Care Providers ......................................................................................... 21

ARTICLE V. INTEGRATING THIS PLAN WITH OTHER PAULO MEDICAL PLANS ................................................................................................................ 22

Transferring to a Job Covered by This Plan ........................................................... 22 Credit for Prior Participation ................................................................................. 22

ARTICLE VI. COVERED EXPENSES AND LIMITATIONS ......................................... 23 - 31

Covered Expenses .......................................................................................... 23 - 25 Prescription Drug Plan ................................................................................. 26 – 27 Clinical Trials ................................................................................................ 27 - 29 Limitations ..................................................................................................... 29 - 31


TABLE OF CONTENTS ARTICLE VII. MANAGED HEALTH CARE .................................................................... 32 - 38

Pre-Admission Certification/Pre-Surgical Review .................................................. 32 Concurrent Review ......................................................................................... 32 - 33 Retrospective Review ............................................................................................ 33 Pre-Admission Certification/Pre-Surgical/Concurrent and

Retrospective Review Reduction in Benefits ............................................. 33 - 34 Disease Management for Chronic Medical Conditions ............................................ 34 Appeals Procedure ................................................................................................ 34 Standard Appeal.................................................................................................... 35 Expedited Appeal .................................................................................................. 35 Second Appeal ...................................................................................................... 35 External Review Process ................................................................................ 36 - 38

ARTICLE VIII. CLAIMS AND OTHER PROVISIONS .................................................... 39 - 41

Claim Decisions ............................................................................................. 39 - 40 Payment of Claims ................................................................................................ 40 Facility of Payment ……………………………………………………………… 41

ARTICLE IX. COORDINATION OF BENEFITS ............................................................. 42 - 44

Definitions ............................................................................................................ 42 Benefit Determinations ................................................................................... 43 - 44 Excess Coverage ................................................................................................... 44 Information Rights ................................................................................................ 44 Payment Adjustments ............................................................................................ 44

ARTICLE X. MEDICARE ................................................................................................. 45 - 46

Election Options .................................................................................................... 45 Coverage Options .................................................................................................. 45 Effect of Eligibility for Medicare Coverage for Disabled

Former Employees ................................................................................... 45 - 46 ARTICLE XI. NAMED FIDUCIARIES. ............................................................................ 47 - 48

Delegation of Duties .............................................................................................. 47 Liability ................................................................................................................ 47 Authority of the Fiduciary ..................................................................................... 47 Duties of the Plan Administrator ..................................................................... 47 - 48 Claim Administrator .............................................................................................. 48

ARTICLE XII. FUNDING POLICY AND BASIS OF PAYMENTS TO AND FROM PLAN ...................................................................................................... 49

Contributions ........................................................................................................ 49 Plan Assets ........................................................................................................... 49

ARTICLE XIII. AMENDMENT OR TERMINATION OF PLAN ............................................ 50

Amendment and Termination ................................................................................. 50 Disposition of Assets Following Termination ......................................................... 50


TABLE OF CONTENTS ARTICLE XIV. .................................................................................... GENERAL PROVISIONS 51 - 56

Sex and Number.................................................................................................... 51 Physical Examination and Autopsy ........................................................................ 51 Legal Actions ........................................................................................................ 51 Not Workers’ Compensation Insurance .................................................................. 51 Assignment of Benefits and Claims of Creditors ..................................................... 51 Applicable Law ..................................................................................................... 51 Conformity with Law ..................................................................................... 51 - 52 Recovery Right ..................................................................................................... 52 Recovery from Third Parties ........................................................................... 52 - 55 Not an Employment Contract ................................................................................ 55 Nondiscrimination ................................................................................................. 55 HIPAA Notices and Certificates of Creditable Coverage ........................................ 56 Medical Care Disclaimer ....................................................................................... 56 Rescission ............................................................................................................. 56

HRShare\Benefits\MEDICAL\2016\Medical Plan 1

PAULO PRODUCTS COMPANY

MEDICAL PLAN

WHEREAS, Paulo Products Company has heretofore established an Employee Benefit Plan providing

Medical Benefits for its employees and their eligible dependents, and

WHEREAS, Paulo Products Company now wishes to amend and restate the Medical Plan to, among

other things, reflect legislative changes;

NOW THEREFORE, be it resolved that effective January 1, 2016, the Paulo Products Company

Medical Plan is amended and restated in accordance with the terms and conditions of this document.


ARTICLE I DEFINITIONS

A. DEFINITIONS

As used in this plan, whether or not the following terms are capitalized, they shall have the meaning indicated:

1. Active Work on a Full-Time Basis means an employee who has attained an average of not less than 30 Active Work Hours for the number of weeks worked in the employee’s most recent Look-Back Period (as defined by the Affordable Care Act, as amended).

2. Active Work Hours means the number of hours for which an Eligible Employee is performing work for the Company at his customary place of employment or another place as required by the Company in accordance with the established employment practices of the Company. Active Work Hours shall also include time off for:

� Company established Holidays, � Vacations, � Sickness and Accident Leave, � Funeral Leave, � Jury Duty, � Work-related injuries that qualify for Workers’ Compensation, � Qualified Leave of Absence, or � any other time off that is required by law to be included in attaining

Active Work on a Full Time Basis status.

Employees who are compensated on an hourly basis will receive credit for one Active Work Hour for each hour for which they are compensated in the above categories. Employees who are not compensated on an hourly basis will receive credit for eight Active Work Hours for each day in which they receive any compensation for one or more of the above categories. Employees will receive credit for Active Work Hours for any other circumstances required by law.

3. Approved Leave of Absence means a temporary uncompensated absence from employment, other than a Qualified Leave of Absence, initiated at the employee’s request as defined in the Company Employee Handbook for the applicable location and employment status.

4. Average Semi-Private Charge means:

a. the standard charge by a Hospital for a semi-private room and board accommodation, or the average of such charges where the Hospital has more than one established level of such charges, or

b. 90% of the lowest charge by the Hospital for a single-bed room and board accommodation where the Hospital does not provide any semi-private accommodations.

5. Calendar Year means the annual period of twelve months beginning January 1 and ending December 31.

6. Child means the following:

a. A natural born child of the employee who has not been legally adopted by someone other than the employee’s spouse; or


b. a legally adopted child of the employee; or c. a child who has been placed for adoption with the employee; or d. a child who is a stepchild of the employee; or e. a blood relative of the employee who meets all of the following conditions:

i. legal guardianship of such child has been granted to the employee by a valid order of a court of competent jurisdiction; and

ii. such child normally lives with the employee in the employee's residence in a parent-child relationship; and

iii. the employee has a legal right to claim such child as a dependent on his federal income tax return; or

f. a child of an Eligible Employee for whom coverage is required by a Qualified Medical Child Support Order (QMCSO-child). Such child is eligible for enrollment regardless of whether the child meets the conditions in i. through iii. above. Also, when a court recognizes a child as a QMCSO-child, the child will be considered the employee's eligible Dependent regardless of whether the child is receiving his main support and care from the employee.

7. Claim Administrator means the organization engaged by the Company and responsible for the processing of claims, payment of benefits, administration, accounting, reporting and/or other services contracted for by the Plan Administrator.

8. Clinical Psychologist means a person who provides clinical psychological services in

connection with the diagnosis or treatment of mental, psychoneurotic, or personality disorders, and who is qualified as a psychologist, in any of the following ways, in the jurisdiction (state, District of Columbia, territory, or possession of the United States) in which he is practicing:

a. If statutory licensure or certification of psychologists exists in the jurisdiction, he holds a valid license or certificate of the jurisdiction as a psychologist.

b. If statutory licensure or certification of psychologists does not exist in the jurisdiction, he holds a valid, professional certification established by the jurisdiction’s recognized psychological association.

c. If neither statutory licensure nor professional certification of psychologists exists in the jurisdiction, he holds a statement of the jurisdiction's recognized psychological association or, in the absence of such a committee, he holds a diploma in the appropriate specialty awarded by the American Board of Examiners in Professional Psychology.

9. Company means Paulo Products Company, a Missouri corporation.

10. Contractor Drugs are defined in Article VI.A.6.

11. Covered Expense means the expenses incurred, or portion of the expense, for any medical care, services or supplies which

a. are performed by a Doctor or prescribed by a Doctor as necessary in connection with the therapeutic treatment of the sickness or injury involved;

b. are Preventive Care services as defined in this Article I.A.;

c. are included in the list of Covered Expenses specified under Article VI.A.;

d. are not excluded from payment by a limiting provision of the particular benefit or by the limitation of coverage provision; and


e. are not in excess of the Usual, Customary and Reasonable charge for the same or similar expense as those terms are defined below:

(i) Usual means the fee usually charged to his other private patients for a given service by an individual Provider (i.e., his own usual fee).

(ii) Customary means the fee that is within the range of usual fees charged by Providers of similar training and experience, for the same service within the same specific and limited geographical area (socioeconomic area of a metropolitan area or sub-economic area of a county).

(iii) Reasonable means the fee that, in the opinion of the review committee of the governing medical association, is justifiable considering the special circumstances of the particular case in question.

The Plan shall take into account the fees and prices generally charged for cases of comparable nature and severity at the time and place where medical care, services and supplies are rendered or received. An expense shall be deemed to be incurred on the date the medical care, service and supply is rendered or received.

12. Custodial care means care which:

a. is provided mainly to maintain the Participant;

b. is designed to help the Participant meet his activities of daily living;

c. is not provided primarily as therapy in the treatment of a sickness or injury; and

d. includes, but is not limited to, the following:

(i) help in walking, bathing, dressing or feeding;

(ii) preparing special diets;

(iii) supervising the giving of medications that do not require attention of trained medical personnel.

13. Dependent means the following persons who are not otherwise eligible as employees:

a. the Spouse of the employee unless coverage is available through the spouse’s employer;

b. Child from birth to the end of the calendar year in which the child attains age 26;

c. Child with a mental or physical handicap who is over the age limit for dependent coverage has dependent coverage if:

(i) the child was covered under a prior plan maintained by the Company on the day before the effective date of the restatement of this plan; and

(ii) the child would qualify to have his coverage continued according to the terms of Article II.J.3. The coverage of the child shall be terminated automatically on the earliest of the dates shown in Article II.J.3.

14. Dependent Coverage means coverage for the Dependent of an Employee enrolled in this Plan.

15. Doctor means only a legally qualified doctor or surgeon. The term "Doctor" shall also include a Doctor of Medicine, Doctor of Osteopathy, Doctor of Podiatry, Doctor of Chiropractic, Doctor of Dental Medicine, Doctor of Dental Surgery, certified Nurse Anesthetist and Clinical Psychologist.


16. Durable Medical Equipment means equipment approved by the Plan Administrator as Medically Necessary to diagnose or treat an illness or injury or to prevent a Participant’s medical condition from becoming worse. To be Durable Medical Equipment an item must be a. made to withstand repeated use;

b. mainly for a medical purpose rather than for comfort or convenience;

c. useful only if the Participant is sick or injured;

d. related to the condition and prescribed by a Doctor for use in the home; and

e. determined by the Plan Administrator to be Medically Necessary to diagnose or treat an illness or injury, help a malformed part of the body work better or keep the condition from becoming worse.

17. Eligible Class means employees working in the following Company locations:

All locations

18. Eligible Employee means an employee who is performing Active Work on a Full-Time Basis on the Paulo Products Company payroll and meets eligibility requirements stated in Article II.B.

19. Employee means an individual hired to work for the Plan Sponsor on the Plan Sponsor’s payroll.

20. Emergency Medical Condition means a medical condition manifesting itself by acute

symptoms of sufficient severity (including severe pain) so that a prudent layperson, who possesses an average knowledge of health and medicine, could reasonably expect the absence of immediate medical attention to result in:

a. placing the health of the individual (or, with respect to a pregnant woman, the health of the woman or her unborn child) in serious jeopardy;

b. serious impairment to bodily functions; or

c. serious dysfunction of any bodily organ or part.

21. Emergency Services means, with respect to an Emergency Medical Condition:

a. A medical screening examination that is within the capability of the emergency department of a Hospital, including ancillary services routinely available to the emergency department to evaluate such Emergency Medical Condition; and

b. Such further medical examination and treatment, to the extent they are within the capabilities of the staff and facilities available at the Hospital to stabilize the patient.

22. ERISA means The Employee Retirement Income Security Act of 1974, as amended.

23. Family or Family Unit means the Participant and his covered Dependents.

24. Fiscal Year means the calendar year.

25. Fund means the financial account of the contributions, income and expenditures of the Trust, as authorized in the Trust Document.

26. Home Health Agency means only a Medicare certified public or private agency or organization, or a subdivision thereof, that:


a. is primarily engaged in providing skilled nursing and other therapeutic services, including hospice services,

b. has policies established by associated professional personnel, including one or more physicians and one or more Registered Nurses (RN) to govern the services provided under the supervision of such a physician or nurse,

c. maintains medical records on all patients, and

d. in cases where the applicable state or local law provides for the licensing of agencies or organizations of this nature, the latter are licensed or approved by the state or local law as meeting the standard established by such licensing.

In no event will the term "Home Health Agency" include one which is engaged primarily in the care and treatment of mental or nervous condition.

27. Hospice means a Medicare certified agency or organization that provides counseling and palliative medical services and may provide room and board to a terminally ill person and that meets all of the following tests:

a. has obtained any required governmental Certificate of Need approval;

b. provides service for a period of 24 hours per day on every day of the week;

c. is operated under the direct supervision of a duly qualified Doctor;

d. has a nurse coordinator who is a registered graduate nurse with four years of full-time clinical experience, at least two of which involved caring for terminally ill patients;

e. has a social service coordinator who is licensed in the jurisdiction in which it is located;

f. has a full-time administrator;

g. maintains written records of services provided;

h. employees are bonded, and it provides malpractice and malplacement insurance; and

i. is established and operated in accordance with the applicable laws in the jurisdiction in which it is located and, where licensing is required, has been licensed and approved by the regulatory authority having responsibility for licensing under the law.

28. Hospital means:

a. a place which meets all of the standards below:

(i) has permanent and full-time care on its premises for bed patients; (ii) has a Doctor in regular attendance; (iii) provides 24 hour a day care by Registered Nurses on duty or call; (iv) is mainly engaged in giving medical care and services for injuries or

sickness but is not a rest home, a nursing home, a convalescent home, or a home for the aged;

(v) has surgical facilities on its premises, except this standard does not apply to a place operated mainly for treatment of the chronically ill;

(vi) is operated lawfully in its area; and (vii) is licensed pursuant to any state or agency of a state responsible for

licensing hospitals; or b. a place, primarily treating alcoholism and/or drug addiction, which meets all

standards below:

(i) has permanent and full-time care on its premises for at least 15 bed-patients;


(ii) has a Doctor in regular attendance; (iii) provides 24 hour-a-day care by Registered Nurses; and (iv) has a full-time psychiatrist or psychologist on the staff; or

c. an ambulatory surgical center which meets all of the standards below:

(i) is a facility licensed by the state as an ambulatory surgical center; (ii) has an organized medical staff of Doctors; (iii) has permanent facilities on its premises that are equipped and operated

primarily for surgery and giving skilled nursing care; and (iv) has Registered Nurse services when a patient is in the facility; does not

provide services or beds for patients to stay overnight.

Formal or informal plans for the transfer of patients to a neighboring or affiliated institution will not cause that place to be considered a hospital if it does not meet all of the other tests.

29. Hospital Confinement or Confined in a Hospital means that an individual is a registered bed patient in a Hospital upon the recommendation of a Doctor. Successive Hospital stays for the same or related conditions separated by fewer than 90 calendar days shall constitute a single continuous period of Hospital Confinement unless there is a return to full-time work by the Employee. In the case of a dependent, successive Hospital stays for the same or related conditions separated by fewer than 90 calendar days shall constitute a single continuous period of Hospital Confinement unless the dependent returns to the normal activities of a person of the like age and sex in good health.

30. Initial Look-Back Period means 12 consecutive months from the date of hire to the first anniversary date of service.

31. Injury means a covered accidental bodily injury.

32. Investigational means any treatment, procedure, facility, equipment, drugs, drug usage or supplies either

a. not recognized by the Plan Administrator as having scientifically established medical value and being in accordance with generally accepted standards of medical practice at the time the services are rendered; or

b. not approved by a governmental agency from which approval is required at the time the services are rendered; or

c. performed in special settings for research purposes or under a controlled environment and which are being studied for safety, efficiency and effectiveness and are awaiting endorsement by the appropriate National Medical Specialty College for general use within the medical community at the time services are rendered.

33. Look-Back Period means the Standard Measurement Period or the Initial Look-Back Period used by the Company to determine a Participant’s full-time status by calculating the average weekly hours of service during that period.

34. Medically Necessary or Medical Necessity means services or supplies which are necessary to diagnose or treat an illness, injury, or symptom. To be Medically Necessary, services or supplies must be determined by the Plan Administrator to be:

a. appropriate and necessary for the symptom, diagnosis or treatment of the medical condition of the Participant;


b. provided for the diagnosis or direct care and treatment of the medical condition of the Participant;

c. in accordance with standards of good medical practice accepted by the organized medical community;

d. not primarily for the convenience of the Participant, his family, his Doctor, or another provider of services;

e. performed in the least costly setting required by the medical condition; and

f. not investigational or experimental as that term is defined in Article VI.B.29.

A setting may be at home, a Doctor's office, an Ambulatory Surgical Facility, a Hospital's outpatient department, a Hospital when the Participant is an inpatient, or another type of facility providing a lesser level of care. Only the Participant's medical condition is considered in deciding which setting is Medically Necessary. The Participant's financial or family situation, the distance he lives from a Hospital or other facility, or any other non-medical factor is not considered.

35. Medicare means the federal program of health insurance for the aged and disabled, otherwise referred to as Title XVIII of the Social Security Act, as amended.

36. Non-PPO Provider means any provider of medical care, services and supplies that is not a PPO Provider or Participating Provider.

37. Outpatient means a Participant treated at a medical facility and assigned to a room for less than 24 consecutive hours.

38. Participant means an Employee or Dependent who is covered for that benefit.

39. Personal Coverage means coverage to an individual who is an Eligible Employee.

40. Plan means this plan document which describes the Schedule of Benefits and Coverages and the provisions for reimbursing claims submitted from eligible Participants.

41. Plan Administrator means Paulo Products Company.

42. Plan Sponsor means Paulo Products Company.

43. PPO means the preferred provider organization with which the Plan Sponsor has contracted to provide access to certain medical care, services and supplies to Plan Participants.

44. PPO Provider or Participating Provider means the hospitals, physicians, and clinical facilities who have a written agreement with the PPO to provide services to Plan Participants, and are, at the time the service or supply is provided, listed in the PPO's list of approved providers.

45. PPO Service Area means the geographical area covered by the PPO selected to serve a Paulo facility.

46. Pregnancy means

a. the state of being pregnant;

b. childbirth;

c. miscarriage; or


d. any complications arising from the pregnancy. 47. Prescription Drug means prescription legend drug and medication for Participants which:

a. is required by federal law to bear a caution which prohibits the dispensing without a Prescription, and

b. under the applicable state law, may only be dispensed upon the prescription order of a Doctor.

Prescription Drug also includes an “over the counter” drug when prescribed by a Doctor so long as such drug is treated under this Plan as Preventive Care.

48. Preventive Care means those services and supplies which must be treated as preventive care under the Patient Protection and Affordable Care Act (“ PPACA”). Also known as “ACA” and “Obamacare” and “Health Care Reform”. Preventive Care includes:

a. The following preventive care services (detailed information available at www.healthcare.gov/center/regulations/prevention/recommendations.html):

(i) Evidence-based items or services that have in effect a rating of “A” or “B” in the current recommendations of the United States Preventive Services Task Force.

(ii) Immunizations that have in effect a recommendation from the Advisory Committee on Immunization Practices of the Centers for Disease Control and Prevention.

b. With respect to the Participant involved: (i) For infants, children and adolescents, evidence-informed preventive care

and screenings provided for in the comprehensive guidelines supported by the Health and Human Services Administration or other regulatory authority having jurisdiction.

(ii) For women, such additional preventive care and screenings not described above, as provided for in comprehensive guidelines supported by the Health and Human Services Administration or other regulatory authority having jurisdiction.

Treatment resulting from a preventive screening is not treated as Preventive Care unless the treatment itself falls within the above definition of Preventive Care. The Plan Administrator or its designee may use reasonable medical management techniques to determine the frequency, method, treatment, or setting for a particular preventive service to the extent not specified in the applicable a guideline or recommendation.

A change in what constitutes Preventive Care will be effective the January 1 that is twelve months or more after a guidance or recommendation modifying what is Preventive Care is released.

49. Provider means a healthcare practitioner or facility that supplies preventive, curative,

promotional or rehabilitative health care services in a systematic way to people, families or communities.

50. Qualified Leave of Absence means a leave of absence period approved by the Company pursuant to either the Family and Medical Leave Act of 1993, the Uniformed Services Employment and Reemployment Rights Act of 1994, or other applicable leave law that applies to the Company and with which the Company is required to comply.


51. Qualified Medical Child Support Order (QMCSO) is a state court or administrative agency order that requires the Plan to provide medical benefits to the Child of an employee who is covered or eligible for coverage under the Plan. When the Plan Administrator receives a medical support order, the Participant will be notified. The Plan Administrator will determine whether the order is “qualified.” Plan Participants and beneficiaries may obtain without charge, a copy of the procedures governing QMCSO determinations from the Plan Administrator.

52. Sickness means covered bodily or mental infirmity or Pregnancy.

53. Skilled Nursing Facility means a place other than a hospital which meets all of the following:

a. can provide permanent full-time care for 3 or more resident patients;

b. has a Doctor available at all times;

c. has a registered nurse or Doctor on full-time duty in charge of patient care;

d. has one or more registered nurses or licensed practical nurses on duty at all times;

e. keeps a daily medical record for each patient;

f. is not solely a rest home or a home for custodial care of the aged;

g. is not mainly engaged in treatment of drug addicts or alcoholics;

h. is operating lawfully as a nursing home.

54. Spouse means one person to whom an Eligible Employee is legally married under any applicable law where and when the marriage is entered into in a religious or civil ceremony and neither the Eligible Employee nor such person is married to any other person. The Eligible Employee will be treated as legally married, even if in the state in which he resides, he cannot be legally married to that individual under the laws of that state. Notwithstanding, the Plan does not recognize common law marriages, civil unions, or domestic partnerships. The Plan Administrator will require proof of the legal marital relationship. An Eligible Employee’s legally separated or divorced spouse is not a Spouse under this Plan.

55. Standard Measurement Period means 12 consecutive months beginning on October 1 and

ending on the next September 30 during which the Company tracks the number of weekly hours of service that employee has worked to determine Active Work on a Full Time Basis.

56. Trust Document means the Agreement and Declaration of Trust dated January 1, 1983 and

any amendments thereto.

57. Waiting Period means 90 days from the employee's date of hire.

58. Work Week means any seven-day period beginning on a given Monday and ending on the following Sunday.


ARTICLE II ELIGIBILITY AND TERMINATION

A. CONTRIBUTION BASIS–PERSONAL COVERAGE

Contributions are at the discretion of the Plan Administrator. Participation in this Plan is voluntary. An eligible employee may waive participation in accordance with procedures established by the Plan Administrator.

B. INDIVIDUAL ELIGIBILITY

An Employee who is in an Eligible Class shall be eligible for coverage under this Plan when he has completed the required waiting period.

C. EFFECTIVE DATE OF PERSONAL COVERAGE

Except in the event of waiver of coverage, the Personal Coverage of each employee who is in an Eligible Class shall be made effective on the date the employee is eligible.

D. ENROLLMENT AFTER EFFECTIVE DATE

Those Eligible Employees and their Dependents who are not enrolled in the Plan within 30 days following first eligibility shall have no right to enroll in the Plan at any time in the future except in the following circumstances:

1. If enrollment was declined because an Eligible Employee had other health insurance coverage and subsequently lost that coverage (COBRA or otherwise), he may enroll himself and his Dependents upon written application to the Plan Administrator within 30 days of the loss of such coverage. The Plan may require the Eligible Employee to sign a document at the time first eligible for coverage acknowledging that he is declining to enroll under this Plan. In the event an Eligible Employee fails to sign and return such document within 30 days following the Eligible Employee’s initial eligibility date, he shall have no right to enroll himself and his Dependent except on account of the loss of such other coverage. An Eligible Employee who exercises his special enrollment rights as specified in this II.D.1. becomes eligible as a Participant as of the date of loss of prior coverage.

2. In the event an eligible employee becomes married or acquires a Child who is a Dependent

through marriage, birth, adoption or placement for adoption, then within 30 days of such marriage, birth, adoption or placement for adoption (except that such period does not begin earlier than the date the Plan makes Dependent coverage generally available) the Eligible Employee may enroll himself and any individual who becomes a Dependent by reason of such marriage, birth, adoption or placement for adoption within 30 days of such marriage, birth, adoption or placement for adoption. This right of enrollment shall be extended to all persons who are then Dependents. If an Eligible Employee exercises his special enrollment rights as specified in this II.D.2., enrollment for the individuals enrolled becomes effective (a) in the case of marriage the date of marriage and (b) in the case of birth, adoption or placement for adoption, the date of such birth, adoption or placement for adoption.

3. During the open enrollment period each year, each Eligible Employee who is not already

a Participant may enroll himself in the Plan. An Eligible Employee who becomes a Participant by reason of such enrollment or who is already a Participant may also enroll his Eligible Dependents who are not already Participants during such period. Coverage for such new Participants shall become effective January 1 of the following year.


E. TERMINATION OF PERSONAL COVERAGE

Personal coverage shall terminate at midnight on the earliest of the following dates:

1. the date on which the employment of the employee is terminated;

2. the date the employee ceases Active Work on a Full-Time Basis in an Eligible Class;

3. the date on which the employee is laid off;

4. in the event the employee is unable to perform all functions of his job due to non-occupational illness or injury, the earlier of:

a. the date upon which the employee fails to provide requested evidence of his inability to perform all functions of his job, or

b. the expiration of a period of twenty-six consecutive weeks in which the employee is unable to perform all functions of his job.

5. in the event an employee obtains a Qualified Leave of Absence, the earlier of the date on which the employee fails to meet the requirements of a Qualified Leave of Absence, or until he is no longer eligible under the provisions of the applicable Act.

6. as to any one coverage or benefit, the date the employee ceases to be eligible for that coverage or benefit;

7. the date the plan terminates;

8. the date on which the employee voluntarily waives coverage;

9. the end of the four-consecutive-week period for which the established contributions have not been made and the employee has not returned to work.

F. ELIGIBILITY FOR DEPENDENT COVERAGE

1. The Eligible Employee's eligibility date for dependent coverage shall be the date he is eligible for personal coverage and has one or more eligible dependents. An employee whose dependents all cease to be eligible shall have a new eligibility date for dependent coverage when he again acquires a dependent.

2. A co-employed Spouse is an eligible employee whose Spouse is also an employee.

3. Co-employed Spouses each have the option of being covered as an Eligible Employee or of electing coverage with one spouse as Eligible Employee and the other as being a Dependent of that employee.

4. A co-employed Child is an Eligible Employee whose parent or parents is/are also an Eligible Employee(s).

5. A co-employed Child has the option of being covered as an Eligible Employee or of being considered a Dependent of his/her Eligible Employee parent.

6. No person may be covered as a Dependent of more than one employee.

G. CONTRIBUTION BASIS - DEPENDENT COVERAGE

Contributions are required for Dependent Coverage. Contributions are at the discretion of the Plan Administrator. Participation in this Plan is voluntary. An eligible employee may waive participation in accordance with procedures established by the Plan Administrator.

Employees shall enroll each dependent for whom coverage under this Plan is requested in accordance with procedures and rules promulgated by the Plan Administrator.


H. EFFECTIVE DATE OF DEPENDENT COVERAGE

For those who are Dependents of an Eligible Employee at the time such Employee becomes a Participant, dependent coverage shall become effective on the date the Eligible Employee is permitted to enroll for dependent coverage so long as within 30 days after he is eligible for dependent coverage he enrolls such Dependents in the Plan and agrees in writing to make the required contributions under the Plan for their coverage.

I. ADDITION OF ELIGIBLE DEPENDENTS

Dependent coverage may be extended to each new Dependent on the date that person becomes eligible for coverage under the Plan so long as such Dependent is enrolled for dependent coverage and the Participant agrees to make the required contributions under their Plan for such coverage within 30 days after the individual becomes a Dependent. If enrolled within such time period, coverage shall be effective as of the date such individual becomes a Dependent.

J. TERMINATION OF DEPENDENT COVERAGE

Dependent coverage shall end on the earliest of:

1. the date personal coverage ends;

2. the end of the period for which contributions for dependent coverage are made;

3. as to a certain dependent, the date the dependent ceases to be eligible. If a child is unable to hold a self-sustaining job because of mental or physical handicap before he ceases to be eligible due to attained age, dependent coverage may be continued if:

a. the dependent's incapacity continues and he meets the conditions for an eligible Dependent, except age; and

b. the first proof of incapacity is furnished to the Company within 31 days after the date the child reaches the limiting age. Proof of incapacity shall be without cost to the Company; thereafter, proof of incapacity must be given to the Company (at employee's expense) within 31 days of the child's birthday each year;

4. the date the employee ceases to be in a class eligible for dependent coverage;

5. as to any benefit, the date that benefit ends; or

6. the date on which the employee voluntarily waives Personal Coverage under the Plan.


ARTICLE III CONTINUATION COVERAGE

A. CONTINUATION COVERAGE PROVISION

1. General

Each Qualified Beneficiary (as that term is defined below) who would lose coverage under the Plan as a result of a Qualifying Event (as that term is defined below) is entitled to elect, within the election period, Continuation Coverage under the Plan which, at the time the coverage is provided, is identical to the coverage provided to similarly situated beneficiaries with respect to whom a Qualifying Event has not occurred.

2. Definitions

For purposes of this provision only, the following terms are defined:

a. Qualifying Event, with respect to this Article III, means:

1. with respect to a covered employee:

(i) a reduction in the number of hours worked; or (ii) termination of employment for any reason other than gross

misconduct; or (iii) the Company files for Chapter 11 reorganization;

2. with respect to a covered spouse of an employee:

(i) a reduction in hours of the employee's employment; or (ii) termination of the employee's employment for any reason other

than gross misconduct; or (iii) divorce or legal separation from the employee; or (iv) the death of the employee; or (v) the employee is entitled to Medicare; or (vi) the company files for Chapter 11 reorganization;

3. with respect to a covered dependent child of an employee:

(i) a reduction in hours of the employee's employment; or (ii) termination of the employee's employment for any reason other

than gross misconduct; or (iii) parent's divorce or legal separation; or (iv) the death of the employee; or (v) the dependent ceases to be a dependent under the terms of this

Plan; or (vi) the employee is entitled to Medicare; or (vii) the Company files for Chapter 11 reorganization.

In no event will the term "Qualifying Event" include a loss of coverage under the Plan that occurs with respect to a Participant's Dependent who is not a Qualified Beneficiary covered under the Plan.

b. Qualified Beneficiary, with respect to this Article III, means any individual who, on the day before an initial Qualifying Event, is covered under the Plan as an employee, the spouse of an employee or the dependent child of the employee, except that a child who is born to or placed for adoption with the covered employee during the period of continuation coverage may also be considered a Qualified Beneficiary.

c. Covered Employee, with respect to this Article III, means an individual who is or

was covered under this Plan by virtue of performance of services by the individual for one or more persons maintaining the plan.


3. Benefits Offered

a. Qualified Beneficiaries may elect to continue their coverage subject to the terms

and conditions of the Plan.

b. Any changes in the benefits and/or the cost of coverage under this Plan will also apply to individuals who have continuation coverage under this provision.

4. Maximum Coverage Period

a. Continuation coverage shall be offered, for a maximum of 36 months, to Qualified

Beneficiaries whose coverage has ceased due to a Qualifying Event, unless: (i) coverage was lost due to termination of employment or reduction of hours

worked, in which case continuation coverage will be offered for a maximum of 18 months; or

(ii) coverage was lost due to filing for Chapter 11 reorganization, in which case the provisions outlined in Section 4980B of the Internal Revenue Code will apply.

(ii) if, within 60 days after the initial Qualifying Event, a Qualified Beneficiary is disabled, such Qualified Beneficiary and other members of the Family Unit who are Qualified Beneficiaries may continue coverage for up to 29 months, subject to the requirements of paragraph 10 below.

b. Continuation coverage may end earlier than provided above if one of the following

occurs. Continuation coverage will end on the earliest of: (i) the date the maximum coverage period ends; (ii) the date coverage ceases by reason of the Qualified Beneficiary's failure to

make the required payment for the cost of coverage within 30 days of the due date; provided, however, that the first payment shall not be required earlier than 45 days after the date of the election; or

(iii) the date the individual becomes covered under another group health plan that does not limit coverage with respect to a pre-existing condition; or

(iv) the date the individual is entitled to Medicare; or (v) the date the Company no longer provides group health coverage to any of

its employees.

5. Notification Procedures

Notice of rights under this provision shall be given as follows: a. The Plan Administrator or his designee will provide, at the time of commencement

of coverage under the Plan, written notice to each covered employee (and spouse if applicable) of the rights to continuation coverage provided herein.

b. A Qualified Beneficiary has the responsibility to inform the Plan Administrator of

a divorce, legal separation or a child losing dependent status under the group health plan within 60 days of the later of: (i) the date of the Qualifying Event; or (ii) the date of the loss of coverage in order to maintain his right to continued coverage.


c. The Plan Administrator or his designee will notify each Qualified Beneficiary of his right to continue coverage within 14 days of (i) the date of the Qualifying Event; or (ii) the date the Plan Administrator receives notice as outlined in

subparagraph b. above. d. Notification made to a Qualified Beneficiary who is the spouse of a covered

employee shall be treated as notification to all other Qualified Beneficiaries residing with the spouse at the time notification is made.

6. Election Procedures

a. A Qualified Beneficiary may elect to continue coverage within the 60-day period

beginning on the later of: (i) the date coverage is lost under the plan; or (ii) the date notification is made to the Qualified Beneficiary by the Plan

Administrator.

b. An election made by a Qualified Beneficiary who is a covered employee or the spouse of a covered employee on behalf of any other Qualified Beneficiary will be binding, although each Qualified Beneficiary is entitled to make a separate election.

c. Continuation coverage will begin on the day following the original loss of

coverage, except if a Qualified Beneficiary waives his right to continuation coverage and subsequently revokes the waiver within the 60-day election period, continuation coverage will begin on the date of the election.

7. Payment Requirements

a. The Company may require payment for continuation coverage in an amount equal

to but not greater than 102% of the cost to the Plan for the coverage based on a reasonable actuarial estimate of said cost and in accordance with the maximum payment permitted by law. The Qualified Beneficiary may elect to make payments in monthly installments.

b. Payment shall be considered to be made in a timely manner, if

(i) payment for the period beginning on the date of the Qualifying Event and ending on the date of the election is made within 45 days of the date of the election; and

(ii) payment for any succeeding period is made within 30 days from the first day of that period; however, if the Company is afforded a longer grace period by any insurance company, HMO or other entity that provides plan benefits, the longer grace period will be extended.

8. Evidence of Good Health Not Required

Continuation coverage may not be conditioned upon, or discriminate on the basis of, or lack of, evidence of good health.

9. Medicare-Entitled Employee


Notwithstanding the other provisions of this Article III, with respect to a Medicare-entitled Employee, continued coverage for any of the Employee's dependents who become Qualified Beneficiaries will not end before the earliest of the following dates: a. If the Qualifying Event occurs on or after the date on which the employee became

entitled to Medicare, the date which is 36 months from the date the employee became entitled to Medicare.

b. If an employee becomes entitled to Medicare during a period of coverage

continued by or for such dependents as a result of a previous Qualifying Event, the date which is 36 months after the date of the first Qualifying Event.

c. The date on which the Company ceases to provide any group health plan to any

employee.

d. The date that coverage ceases due to failure to make the required premium payment.

e. The date, after the date of the election, on which the Qualified Beneficiary is

covered by another group health plan that does not contain any limitation or exclusion with respect to a pre-existing condition, or becomes entitled to Medicare.

Provided that in no event will a Qualified Beneficiary receive a shorter period of continued coverage than that to which he or she would otherwise be entitled in the absence of this paragraph 9.

10. Disabled Beneficiary

Notwithstanding the other provisions of this Article III, if any Qualified Beneficiary is determined by the Social Security Administration to have been disabled within 60 days after the time of a Qualifying Event described in paragraph 2.a. above, such Qualified Beneficiary and other members of the same Family Unit who are Qualified Beneficiaries shall be entitled to continue Plan coverage for up to 29 months after that Qualifying Event, provided the Plan Administrator is notified of such determination within 60 days of such determination and within the first 18 months of continued coverage.

The applicable premium for each of the 19th through 29th months shall be 150% of the otherwise applicable cost of coverage. The Plan Administrator must be notified by the Qualified Beneficiary or other member of the Family Unit within 30 days after any final determination by the Social Security Administration that the Qualified Beneficiary is no longer disabled but in all events within the first 18 months of continuation coverage. Coverage under this provision shall end with the month which begins more than 30 days after the date of such determination.

The Plan Administrator may require the Qualified Beneficiary or other appropriate member of the Family Unit to affirm the foregoing in writing but such requirements shall nevertheless be binding without such written affirmation.


ARTICLE IV SCHEDULE OF BENEFITS

A. DEDUCTIBLE AMOUNT

1. The term “Deductible Amount” shall mean:

For Participants:

(a) $1,000 of Covered Expenses incurred through a PPO Provider by each Participant during a Plan Year, and

(b) $1,000 of additional Covered Expenses incurred by each Participant during a Plan Year if these additional expenses are incurred with Non-PPO Providers.

For Family Unit:

(c) $3,000 of total Covered Expenses incurred through a PPO Provider by Participants of any one Family Unit during a Plan Year, and

(d) $3,000 of additional total Covered Expenses incurred by Participants during a Plan Year if these additional expenses are incurred with Non-PPO Providers.

2. Deductible amounts will be determined in the order the claims to which they are applied are processed at the Claim Administrator's Office, not in the order incurred, and no retroactive calculations for these purposes will be made.

3. If two or more individuals in a Family Unit are injured in the same accident, the Deductible Amount applied to all Covered Expenses incurred in the accident will be the lesser of $1,000 or the total of unmet deductible for all Participants involved in the accident or the unmet deductible for the Family Unit.

4. The Deductible Amount shall not apply to Preventive Care rendered or supplied by a PPO Provider (or, if the PPO does not have a PPO Provider who can provide the particular service or item of Preventive Care, then a Non-PPO Provider).

B. OUT-OF-POCKET MAXIMUMS

1. Stop-Loss Provision: After $25,000 of Covered Expenses have been incurred for any Participant during one Plan Year, the Plan will reimburse subsequent Covered Expenses incurred by that Individual during that Plan Year at 100 percent, except as provided in Article IV.B.3.

2. After $50,000 of Covered Expenses have been incurred by Participants of any one Family Unit during one Plan Year, the Plan will reimburse subsequent Covered Expenses incurred by any Participant in that Family Unit during that Plan Year at 100 percent, except as provided in Article IV.B.3.

3. Expenses excluded from Stop-Loss Provision:

a. Covered Expenses for treatment of temporomandibular joint syndrome and chiropractic services;

b. Out-of-pocket expenses when pre-surgical review is required and not obtained for a surgical procedure;

c. Out-of-pocket expenses when pre-admission certification is required and not obtained for a Hospital Confinement;

d. Expenses in excess of usual, customary and reasonable charges;


e. Charges in excess of Plan maximums;

f. Ineligible charges.

4. For Covered Expenses for Preventive Care rendered or supplied by a PPO Provider (or, if the PPO does not have a PPO Provider who can provide the particular service or item of Preventive Care, then a Non-PPO Provider), the dollar figures in Article IV.B.1 and 2 are zero.

C. COVERED PORTION

1. With respect to the cost of medical care, services and supplies provided by a PPO Provider incurred by an Eligible Employee (or his dependents who are Covered Individuals) who is assigned to a Company facility that is served by a PPO, benefits are payable for Covered Expenses incurred after the Deductible Amount has been satisfied, subject to the limitations of this Article IV, as follows:

a. 50 percent of Covered Expenses for services rendered by a Doctor of Chiropractic, not to exceed a maximum benefit of $15 per visit or $500 per individual per calendar year.

b. 70 percent for Covered Expenses in connection with brand name Prescription Drugs other than Contractor Drugs as defined in Article VI.A.6.

c. 100 percent for Covered Expenses in connection with Second Surgical Opinions.

d. 80 percent for ambulance service.

e. 80 percent for radiologists, anesthesiologists, and pathologists when services are performed in an in-network facility.

f. 80 percent for all other Covered Expenses, subject to the limitations set forth in Section D through Section K of this Article IV. This includes Covered Expenses in connection with generic name Prescription Drugs other than Contractor Drugs as defined in Article VI.A.6.

For purposes of this Section C.1, the cost of medical care expenses and supplies provided by a PPO Provider shall include the following:

(i) Medical care, services and supplies not available at a PPO facility, provided such medical care, services and supplies are authorized in advance by the PPO.

(ii) Emergency Services received by a Participant from a Non-PPO Provider for treatment of any Emergency Medical Condition.

2. With respect to the cost of medical care, expenses and supplies provided by a Non-PPO Provider incurred by an Eligible Employee (or his dependents who are Participants) who is assigned to a Company facility that is served by a PPO, medical benefits are payable for Covered Expenses in excess of the Deductible Amount, subject to the limitations of this Article IV as follows:


b. 80 percent for Covered Expenses in connection with generic name Prescription Drugs other than Contractor Drugs as defined in Article VI.A.6.

c. 70 percent for Covered Expenses in connection with brand name Prescription Drugs other than Contractor Drugs as defined in Article VI.A.6.

d. 100 percent for Covered Expenses in connection with Second Surgical Opinions.


e. 60 percent for all other Covered Expenses, subject to the limitations set forth in Section D through Section K of this Article IV.

3. With respect to Covered Expenses incurred by an Eligible Employee (or his dependents who are Participants) who is assigned to a Company facility that is not served by a PPO, medical benefits are payable for Covered Expenses in excess of the Deductible Amount subject to the limitations of this Article IV as follows:


b. 80 percent for Covered Expenses in connection with generic prescription drugs other than Contractor Drugs as defined in Article VI.A.6.

c. 100 percent for Covered Expenses in connection with Second Surgical Opinions.

d. 70 percent for all other Covered Expenses, subject to the limitations set forth in Section D through Section K of this Article IV. This includes Covered Expenses in connection with brand name Prescription Drugs other than Contractor Drugs as defined in Article VI.A.6.

D. MAXIMUM BENEFITS

The maximum amount of benefits payable under this Plan (or any other Plan maintained by the Company) to any Participant are as follows:

The amount of lifetime benefits payable in the aggregate for all Covered Expenses incurred by a Participant under this Plan (or any other Plan maintained by the Company) whether or not there is any interruption of coverage under the Plan and (whether or not there is any change in status from Eligible Employee to Eligible Dependent and vice versa) as the result of all Hospice care shall not exceed $10,000, except that charges for pre-death and bereavement counseling are subject to a maximum benefit of $500.

E. PREGNANCY EXPENSE

1. Benefits for Covered Expenses relating to pregnancy of female employees and dependent spouses will be payable on the same basis as Covered Expenses for any other sickness. For purposes of determining the benefit amount payable, any charges incurred by a covered newborn child for bassinet, nursery and routine newborn laboratory testing made by the hospital for any day on which both mother and child are confined in the hospital will be considered Covered Expenses incurred by the mother, subject to all other exclusions and limitations of the Plan.

2. Notwithstanding the above, for purposes of Coordination of Benefits as described in Article IX.B, the newborn child, and not the mother, shall be considered the person on whom the claim for such charges is based.

3. No benefits are payable for the pregnancy of a dependent child, except and to the extent that medical complications have arisen from the pregnancy. As used in this provision, the term "medical complications" shall not include delivery by caesarian section or elective abortion.

4. The mother and newborn child shall be allowed an in-patient Hospital stay of not less than 48 hours following a normal vaginal delivery, or 96 hours following a Caesarean section. These minimum time periods shall not be subject to any pre-certification requirements.

F. SURGICAL EXPENSE


The maximum allowable amount of Covered Expenses for all surgical procedures performed in any one series of operations is as follows:

1. The maximum amount of Covered Expenses payable when two or more procedures are performed during the course of a single operation through the same incision, or in the same natural body orifice, or in the same operative field shall be the largest Usual, Customary and Reasonable procedure amount for any one procedure. None of the other procedures will be reimbursed.

2. The maximum amount of Covered Expenses payable when two or more surgical procedures are performed at the same operative session in separate operative fields and through separate incisions, shall be the sum of the Usual, Customary and Reasonable procedure amounts allowable for each procedure performed.

3. The maximum amount of Covered Expenses payable when a bilateral procedure is performed at the same operative session in separate operative fields shall be the sum of the Usual, Customary and Reasonable procedure amounts for the unilateral procedure.

G. LIMITATIONS TO BENEFITS FOR TEMPOROMANDIBULAR JOINT SYNDROME

Treatment of temporomandibular joint syndrome (TMJ) is limited to $500 in Covered Expenses during any one calendar year. Services resulting in changes to the permanent structure of the teeth will not be allowed as a Covered Expense.

H. LIMITATIONS TO BENEFITS FOR CHIROPRACTIC SERVICES

Covered expenses for services rendered by a Doctor of Chiropractic will be limited to charges in connection with the diagnosis, including X-rays incidental thereto, and correction by manual or mechanical means of distortion, misalignment or subluxation of the spinal column. This Plan does not cover services rendered to maintain current health status or to prevent recurrence of illness or injury.

I. SECOND SURGICAL OPINION

Comprehensive medical benefits are payable in an amount equal to 100% of the Covered Expenses incurred by a Participant in connection with a second surgical opinion.

J. BENEFITS IN CONNECTION WITH CERTAIN MASTECTOMIES

In connection with a mastectomy, coverage will also be provided for prostheses and physical complications at all stages of such mastectomy, including lymphedemas, but subject to all limitations and exclusions of the Plan.

K. EMERGENCY SERVICES

The PPO Provider level of benefits is payable when a Participant receives Emergency Services either out of a PPO Service Area or from a Non-PPO Provider for an Emergency Medical Condition. No pre-approval is required for Emergency Services.

After the condition of the Participant is stabilized, benefits will be based on the Provider’s status as a PPO Provider or a Non-PPO Provider. At such time, if the Participant elects to continue to stay in a Hospital or other facility which is a Non-PPO Provider or receive treatment from any Non-PPO Provider, Benefits for Covered Expenses will be payable based on a the Provider’s status as a Non-PPO Provider.

L. PRIMARY CARE PROVIDERS


To the extent the Plan requires use of a primary care Provider, a Participant may designate any primary care Provider who is a PPO Provider. A pediatrician may be designated as a Child’s primary care Provider, and no referral is required before a Participant seeks obstetrical or gynecological care.


ARTICLE V INTEGRATING THIS PLAN WITH OTHER PAULO MEDICAL PLANS

A. TRANSFERRING TO A JOB COVERED BY THIS PLAN

1. Participants under another Company plan are covered upon enrollment in this plan.

2. Benefits covered and excluded are governed by this plan on the date that a Participant becomes covered by this plan.

B. CREDIT FOR PRIOR PARTICIPATION

1. Participants are credited for amounts paid under provisions of another Company plan under its deductible and cost sharing provisions as if those payments had been made under this Plan.

2. Amounts paid on behalf of Participants in another Company plan will be considered to have been incurred under the maximum benefit provisions of this Plan.


ARTICLE VI COVERED EXPENSES AND LIMITATIONS

A. COVERED EXPENSES

1. Covered Hospital Charges:

a. hospital room and board at the Average Semi-Private Charge;

b. an intensive care room;

c. miscellaneous Hospital charges:

general nursing services diagnostic tests operating room services anesthesia oxygen & carbon dioxide physical therapy glucose & serum diagnostic x-ray intravenous procedures inhalation therapy medicines & drugs shock therapy (inpatient or outpatient) transfusions radiology treatment (inpatient or outpatient) dressings dialysis (inpatient or outpatient) casts laboratory services pathology services

d. outpatient surgery, treatment of accidental injuries or life threatening illness causing an acute medical emergency except that the first $400.00 of charges for treatment in the Emergency Room will not be covered when the Participant is not admitted to the Hospital;

e. services of an anesthesiologist;

f. professional ambulance service to the hospital.

2. Other Covered Expenses:

a. Doctor's services;

b. surgeon and assistant surgeon's services;

c. psychiatric service charges by a Doctor which relate to care of nervous and mental conditions and services by a Doctor for drug and alcohol abuse;

d. services of a registered nurse or licensed practical nurse;

e. Prescription Drugs for Participants, except that benefits for Contractor Drugs as defined in Article VI.A.6 are only available as set out in Article VI.A.6;

f. diagnostic x-ray and laboratory examinations;

g. charges for pre-admission testing (screening x-rays and lab tests) which is done within 14 days of a pre-scheduled inpatient Hospital confinement;

h. x-ray, radium, and radioactive isotope therapy;

i. anesthesia;

j. ambulance service from the scene of the accident or illness to a Hospital where treatment is given or to or from any other location if ordered by a Doctor;

k. necessary emergency transportation (within the continental United States) to the nearest Hospital where treatment can be given;

l. voluntary sterilization;

m. physiotherapy;


n. occupational therapy;

o. services of a qualified speech therapist if charges are made for speech therapy used for the purpose of correcting speech loss or damage which:

(i) is due to a sickness, other than a functional nervous disorder or is due to surgery; or

(ii) follows surgery to correct a birth defect.

p. oxygen and/or rental of equipment required to administer it;

q. acupuncture performed by an M.D. or D.O.;

r. braces, crutches, casts, splints, initial purchase of artificial limbs, eyes or other prosthetic appliances necessary to replace or aid in the function of a missing or impaired physical organ or part.

s. rental (or purchase if more cost effective) of durable medical equipment required for temporary therapeutic use;

t. blood, if not replaced;

u. initial contact lenses if required following cataract surgery;

v. consultation and laboratory charges for routine mammograms, prostate screenings, pap smears, and colonoscopies;

w. charges incurred due to pregnancy of female employees and covered spouses on the same basis as another illness;

x. newborn care for a Child of a covered female employee or of a Spouse of a Participant for the following expenses:

(i) Hospital care; (ii) pediatric charges until the date of discharge from the Hospital; (iii) circumcision.

y. patient education services for diabetes and ostomy care.

aa. To the extent not otherwise listed in the prior provisions of this Article VI.A.2, Preventive Care when provided by a PPO Provider (or, if the PPO does not have a PPO Provider who can provide the particular service or item of Preventive Care, then a Non-PPO Provider);

3. Expense of a Skilled Nursing Facility:

a. Services provided by a Skilled Nursing Facility are subject to the following:

(i) expenses exceeding 120 days per confinement are not covered; (ii) the Skilled Nursing Facility confinement begins within seven days of a

hospital confinement of at least three consecutive days; (iii) the Skilled Nursing Facility confinement is due to the same condition as

the hospital confinement; and (iv) the patient's Doctor has certified that 24-hour nursing care is required.

b. If the patient is discharged from a Skilled Nursing Facility (for a confinement that met the above eligibility requirements), and is then readmitted within 14 days, the above requirements will be considered as being fulfilled; otherwise, the requirements must be met again. The maximum amount of Skilled Nursing Facility benefits may be reinstated if confinements are separated by 90 or more days, whether for related or unrelated conditions.

c. Covered expenses will be those for room and board charges and necessary medical services and supplies provided by the Skilled Nursing Facility.


4. Home Health Care Expenses:

If a Participant is confined in a Hospital (and benefits are payable under this Plan for the Hospital confinement), but:

a. the attending Doctor certifies that the Participant could go home if certain medical services were provided there for continued care of the same Injury or Sickness; and

b. the Doctor provides a written plan for such home care (Home Care Plan) to be administered by a Home Health Agency,

the Plan will pay benefits, subject to the applicable deductible amount, limitations and maximums, for all Covered Expenses incurred as part of the Home Care Plan.

Subject to any applicable maximum benefits and to the retrospective review by the claim administrator of the treatment plan and while coverage under this Plan is in effect, Home Health Care coverage will continue as long as the Participant's Doctor continues to certify the need for such care. Covered Expenses for Home Health Care visits are limited to one per day.

If benefits are paid for a Covered Expense under this provision, payment will not be made for that same expense under any other Plan provision.

Home Health Care benefits are not payable for:

1) Custodial or domiciliary care;

2) Transportation service;

3) Services of someone who lives with the Participant;

4) Services not included in the written Home Care Plan;

5) Services rendered at a time when the Participant is not under the care of the Doctor who set up the Home Care Plan; or

6) Any items excluded under other limitations and exclusions set forth in this Plan.

5. Hospice Care Expenses:

When a Participant's Doctor recommends in writing on or before Hospice care is started a plan of Hospice care for:

a. palliative care of a terminal Sickness (where life expectancy is less than six months), and

b. the Participant or his legally authorized representative elects in writing to follow the Doctor's proposed treatment plan,

the Plan will pay benefits, subject to the deductible amount and other limitations and exclusions of this Plan, for Covered Expenses incurred as part of the Hospice care plan, not to exceed the applicable maximums. If benefits are paid under this provision for any Covered Expense, payment for that same expense will not be duplicated under any other Plan provision. Coverage under this provision ends if the Participant elects to discontinue Hospice care.

Hospice Care benefits are not payable for:

1) services provided by persons who do not regularly charge for their services;

2) counseling which is not provided as part of the Hospice care plan;

3) services provided by homemakers, caretakers and the like;

4) funeral expense; or

5) treatment intended to cure the terminal Sickness.


6. Prescription Drug Plan:

Certain Prescription Drugs may be obtained directly from the entity expressly designated by the Plan Administrator as the Pharmacy Benefits Manager (“PBM”) or from one of its participating pharmacies ("Participating Pharmacy"). Prescription Drugs which are available under this paragraph 6 will be designated from time to time by the PBM. Such Prescription Drugs provided by the PBM or by a Participating Pharmacy (and not dispensed directly by a Hospital or Doctor) are defined as "Contractor Drugs". Some non-prescription medical supplies are provided under the general provisions of the Plan.

The PBM maintains a schedule of Contractor Drugs approved to be prescribed under our Medical Plan. This schedule is called a Formulary. The contents of the Formulary are reviewed on a regular basis by the PBM and drugs are added to or deleted from the Formulary as deemed appropriate by the PBM.

The PBM employs various methodologies for ensuring the most economical price structure of pharmaceutical utilization without compromising the efficacy of the drugs. No benefits shall be provided for any Prescription Drug not covered under this paragraph 6.

Charges for Prescription Drugs not obtained directly from the PBM or from a Participating Pharmacy, shall not be covered Expenses under the Plan, except as provided in a.(iv) of this paragraph.

Coverage for all Prescription Drugs is subject to reasonable medical management.

All Contractor Drugs are subject to a $50.00 calendar year deductible for each Participant.

a. Copayments

For each Contractor Drug, a Participant shall pay the following copayment at the time of purchase:

(i) At Participating Pharmacies

Except as provided in (iii) of this subparagraph,

Generic $14.50

Preferred Brand Name $45.00

Non-preferred Brand Name $90.00

In the event a Participant does not present to the Participating Pharmacy the appropriate membership card for the Plan or the Participating Pharmacy is otherwise not able to verify participation in the Plan, the Participant shall only be entitled to reimbursement as provided in (iv) of this subparagraph except that reimbursement will be provided according to this subparagraph (i) if such inability to verify participation in the Plan occurs within the first 45 days of coverage.

(ii) Through PBM's Home Delivery Service

Generic $29.00



(iii) A $14.50 copayment will apply to each of the following items which are considered to be diabetic supplies: insulin, syringes, lancets, test strips and


glucose tabs, regardless if brand or generic. A $14.50 copayment will apply to a 30-day supply of diabetic supplies when purchased at any Participating Pharmacy. A $29.00 copayment will apply to a 90-day supply of diabetic supplies when purchased through the Home Delivery Service.

(iv) Member Submitted Claims

When a Participant purchases a Prescription Drug including Preventive Care drugs) covered by the Formulary from a pharmacy which is not a Participating Pharmacy, the Participant may file a claim with the PBM and shall be reimbursed for that amount the Plan would have paid for the Prescription Drug if it had been purchased through a Participating Pharmacy less the following copayment:

Generic $29.00



(v) Unit doses are limited to the greater of 100 dose units or the following day supply maximums:

Home Delivery Service 90-day supply

Participating Pharmacy 30-day supply

Any other licensed Pharmacy 30-day supply

b. Participating Pharmacies It is the Participant's responsibility to determine at the time of purchase whether a pharmacy is a Participating Pharmacy.

c. Deductibles and Maximum Amounts

No deductible or copayment shall apply to Contractor Drugs which are treated as Preventive Care except that if a generic drug is available, then the deductible and copayment will apply to the brand name drug unless the generic drug is medically inappropriate for the Participant in question.

Copayments for all other Prescription Drug purchases will count toward the satisfaction of the $50.00 calendar year deductible for Contractor Drugs and the out-of-pocket maximum amounts under the Plan, but will not count toward the satisfaction of the Medical Plan Deductible Amount and are not otherwise reimbursable under the Plan as Covered Expenses.

7. Clinical Trials

The Plan will provide benefits for Routine Patient Costs in connection with a Participant’s participation in an Approved Clinical Trial

a. An Approved Clinical Trial is defined as a clinical trial that meets all the following conditions:

(i) The clinical trial is conducted for the prevention, detection, or treatment of cancer or another disease or condition likely to lead to death unless the course of the disease or condition is interrupted and

(ii) The clinical trial has been peer reviewed and is approved by at least one of the following:


a) The United States National Institutes of Health

The Centers for Disease Control and Prevention The Agency for health Care Research and Quality The Centers for Medicare & Medicaid Services

b) A cooperative group or center of the National Institutes of Health;

c) A qualified nongovernmental research entity identified in guidelines issued by the National Institutes of Health for center support grants,

d) The United States Food and Drug Administration pursuant to an investigational new drug exemption,

e) The United States Departments of Defense, Department of Energy or Veterans Affairs,

f) Is federally funded, or is either:

i. Conducted under an investigational new drug application (IND) reviewed by the Food and Drug Administration, or

ii. A drug trial that is exempt from the IND application requirements.

b. Routine Patient Costs means all items and services charges for which would be considered Covered Expenses and are consistent with the coverage provided

under the Plan for a Participant who is not enrolled in an Approved Clinical Trial.

The following costs, however, are not considered Routine Patient Costs:

(i) An FDA approved drug or device shall be a Patient Care Service only to the extent that the drug or device is not paid for by the manufacturer, the distributor or the provider of the drug of device, or

(ii) Non-health care services that the covered person may be required to receive as a result of being enrolled in the Approved Clinical Trial, or

(iii) Costs that would not be covered for non-investigational treatments, or

(iv) The costs of services, which are not provided as part of the Approved Clinical Trial’s stated protocol or other similarly, intended guidelines, or

(v) The cost of the investigational item, device or service, or

(vi) The cost of items and services provided solely to satisfy data collection and analysis needs and that are not used in direct clinical management, or

(vii) The cost for a service that is clearly inconsistent with widely accepted and established standards of care for a particular diagnosis, or

(viii) Any item or service that is paid for, or should have been paid for by the sponsor of the trial.

c. Coverage for Routine Patient Costs for an Approved Clinical Trial is only available through PPO Providers willing to accept the Participant as a participant in the trial. This does not, however, preclude a Participant from participating in an Approved Clinical Trial conducted outside the state in which the individual resides.

d. The Plan may not deny the Participant’s participation in an Approved Clinical Trial and may not deny (or limit or impose additional conditions on) the coverage


of Routine Patient Costs for items and services furnished in connection with participation in the trial.

B. LIMITATIONS

Covered Expenses do not include:

1. blood or plasma to the extent a refund or credit is made as a result of operation of a group blood bank or otherwise.

2. cosmetic, plastic, reconstructive or restorative surgery unless covered expenses are incurred for repair of a disfigurement caused from any of the following:

a. an accidental injury to the extent care is rendered within 12 months after the date of the accident;

b. a birth defect for those individuals who become Participants at birth; or

a. when a mastectomy has been performed, (i) reconstruction of the breast and surgery and (ii) reconstruction of the other breast to produce a symmetrical appearance.

b. To correct deformities and irregularities on the head and neck caused by surgery performed to treat a covered illness or disease.

3. charges for rhinoplasty, blepharoplasty or brow lift due to a non-functional condition. Charges for rhinoplasty or blepharoplasty to correct a functional condition shall be covered or in the case of rhinoplasty, to correct an accidental injury as provided in 2. above;

4. hearing aids and the fitting thereof, surgical correction of the eye which can be corrected by eyeglasses or lenses (e.g. lasik, radial keratotomy, keratectomy, keratoplasty), eye refractions and glasses, contact lenses or the fitting of eye glasses or contact lenses (other than the first pair of contact lenses or eye glasses or the fitting thereof after cataract surgery), and orthoptics (exercise for the eyes);

5. shoes;

6. injury or sickness resulting from:

a. act of war (declared or undeclared);

b. insurrection;

c. atomic explosion or other release of nuclear energy under any conditions (except when used solely as medical treatment);

7. medical care and supplies furnished in a facility operated under the direction of or at the expense of federal, state or local government, or its agency, or by a Doctor employed by the facility unless:

a. for emergency treatment, or

b. the Participant is not entitled to treatment without charge, or

c. for treatment of non-service-related disabilities in Veterans Administration hospitals, or

c. for covered expenses incurred by a U.S. military retiree (and his covered dependents, if any) while confined in a military medical facility;

8. medical care and supplies to the extent that they are furnished or payable under:

a. a plan or program operated by a National Government or one of its agencies;


b. a State Cash Sickness or similar law including any group insurance policy approved by law;

9. medical care and supplies for which:

a. no charge is made;

b. no payment would be required if the Participant did not have this coverage;

10. charges incurred in connection with suicide or self-inflicted injury when not caused by domestic violence or a medical condition; or injury or sickness sustained while engaging in any criminal enterprise or illegal activity.

11. sickness covered by Worker's Compensation and/or occupational disease laws; or injury if it arises out of employment for pay, profit or gain;

12. dietary products or supplies or treatment for controlling or reducing weight, obesity treatments, including but not limited to any surgical procedures to correct obesity or morbid obesity, or exercise programs except as otherwise provided in Article VI.A.2.aa;

13. custodial care, education or training;

14. dental treatment, except:

a. inpatient hospital expenses while confined for dental treatment; or

b. treatment of an injury to a natural tooth, provided treatment is received within 12 months of the injury.

15. expenses payable under a Paulo Products Company Dental Plan;

16. abortions, unless the life of the mother is in danger, or pregnancy is the result of rape or incest so long as such abortion is performed in accord with applicable state law. In order for charges to be considered for an abortion due to rape, a police report is required. Complications as a result of abortion performed in accordance with applicable state law are Covered Expenses;

17. routine or periodic physical examinations including eye exams (except consultation and laboratory charges for routine mammograms, prostate screenings and pap smears) except as otherwise provided in Article VI.A.2.aa;

18. vaccinations, inoculations, or preventive shots except as otherwise provided in Article VI.A.2.aa;

19. any charges not incident to or necessary to diagnose a sickness or injury, except voluntary sterilization; reversal of surgical sterilization is not covered;

20. any sickness or injury for which the person on whose behalf a claim is presented is not under the regular care of a Doctor;

21. any charges for professional services performed by a person who ordinarily resides in the Participant's household or who is related to the Participant, or the spouse of the Participant, as spouse, parent, child, sister or brother, whether the relationship is by blood or exists by law;

22. any charges for services received or supplies purchased outside the United States, unless the Participant is a resident of the United States and the charges are incurred while traveling on business or for pleasure;

23. charges which exceed the Usual, Customary and Reasonable allowance determined by the Claim Administrator;

24. unnecessary medical care or treatment or charges for services not prescribed by a Doctor;

25. charges for services performed by providers not practicing within the legal scope of their license;


26. charges related to the pregnancy of a dependent other than the employee's spouse;

27. any charges incurred when not caused by a medical condition;

28. charges incurred while an individual is not covered by this Plan;

29. investigational or experimental treatment or any treatment not recognized as generally accepted medical practice by the medical profession. Criteria for determining whether or not a procedure or treatment will be considered experimental will include but not be limited to:

a. whether the patient meets the criteria for transplant or other procedure with regard to age, general health, etc. and has been determined to be a good candidate by an accredited facility.

b. whether the procedure or treatment is commonly performed on a widespread geographic basis.

c. whether the procedure or treatment is generally accepted by the medical profession (based on the opinions of the Council of Medical Specialty Services, National Institute of Health, American Medical Association, Office of Technology Assessment and Clinical Efficacy Assessment Program).

d. the failure rate and side effects of treatment or procedure.

e. whether other, more conventional methods of treatment have been exhausted.

f. whether the procedure or treatment is Medically Necessary and is expected to meaningfully extend and improve the patient's life.

g. whether the procedure or treatment is recognized for reimbursement by Medicare, Medicaid, and other insurers and self-funded plans.

h. whether the procedure or treatment is recognized for reimbursement by the Plan's stop-loss reinsurance carrier.

30. charges for Hospital accommodations in excess of the Average Semi-Private Charge.

31. Preventive Care described in Article VI.A.2.aa. when provided by a Non-PPO Provider unless the PPO does not have a PPO Provider who can provide the particular service or item of Preventive Care.


ARTICLE VII MANAGED HEALTH CARE

A. PRE-ADMISSION CERTIFICATION/PRE-SURGICAL REVIEW

All inpatient Hospital Confinements, except for emergency confinements, and all surgical procedures that are performed outside of a Doctor's office must be reviewed and authorized PRIOR to admission or surgery. Second surgical opinions may be required to comply with the pre-surgical review process. The Utilization Management Organization (UMO), designated from time to time by the company, must be contacted as soon as Hospital confinement or a surgical procedure to be performed outside a Doctor's office is recommended. Emergency confinements must be reported to the UMO within 48 hours of the emergency admission. Maternity admissions that extend beyond the minimum periods specified in Article IV.E.4. must also be reported to the UMO. The UMO will obtain all information, including pertinent clinical information, necessary to make a decision regarding authorization. Requests for information will be limited to those necessary to make a determination. The Participant will be notified of the UMO's decision no later than 15 days after the date the UMO is contacted for the authorization request. If a decision cannot be made due to matters beyond the control of the UMO, the Participant will be notified, within the initial 15 day decision period, of the reason for the extension and the date by which a decision is anticipated. If additional information is needed, the Doctor or the Hospital will be notified within the initial 15 day decision period and will have at least 45 days from receipt of the notice to return the requested information. If the information is received within the 45-day time frame, the UMO will render a decision no later than 15 days after the date the information is received. If the Doctor or Hospital fails to provide the necessary information, the UMO will not be able to authorize the services and the penalties shown herein may be applied to a Participant's benefits. The UMO will make a determination on requests for pre-admission certification/pre-surgical review involving Urgent Care conditions no later than 72 hours after receipt of the request. If additional information is needed in order to make a determination, the Doctor or Hospital will be notified within 24 hours of receipt of the request and will have at least 48 hours from receipt of the notice to provide the necessary information. The UMO will inform the Participant and Doctor or Hospital of the decision the earlier of 48 hours after receipt of the necessary information or 48 hours after the end of the time period for providing the necessary information.

"Urgent Care" means that the standard 15 day decision-making time period would place the life or health of a Participant in serious jeopardy, the Participant's ability to regain maximum function would be jeopardized or, in the Doctor's opinion would subject the Participant to unmanageable pain. A Doctor may determine whether Urgent Care is involved. If a Doctor has not made that determination, the determination may be made by a representative of the Plan, applying the judgment of a prudent layperson possessing an average knowledge of health and medicine.

B. CONCURRENT REVIEW

"Concurrent Review" means the UMO will evaluate the medical need for continued hospitalization. This will involve consultation with the Participant's Doctor and comparison of clinical information to professionally developed medical standards of care.

In addition to having Hospital admissions authorized prior to admission, a Concurrent Review of treatment (again for Medical Necessity) will be conducted throughout the period of confinement. If additional days of confinement are requested beyond those initially authorized by the UMO, the UMO must be contacted to obtain authorization for the continued stay. If the request involves


Urgent Care and is made to the UMO at least 24 hours before the end of the initially authorized days, the Participant will be notified within 24 hours as to whether the continued stay will be authorized. If the request is not made at least 24 hours before the end of the initially authorized days, the Urgent Care time periods described in the pre-admission certification or pre-surgical review provisions will apply.

If the request does not involve Urgent Care, the Participant will be notified of the UMO's decision no later than 15 days after the date the UMO is contacted for the authorization request. If a decision cannot be made due to matters beyond the control of the UMO, the Participant will be notified, within the initial 15 day decision period, of the reason for the extension and the date by which a decision is anticipated. If additional information is needed the Doctor or the Hospital will be notified within the initial 15 day decision period and will have at least 45 days from receipt of the notice to return the requested information. If the Doctor or Hospital fails to provide the necessary information, the UMO will not be able to authorize the services and the penalties shown herein may be applied to a Participant's Benefits. If the information is received within the 45 days, the UMO will render a decision no later than 15 days after the date the information is received. Regardless of the Participation status of the provider, if a Participant fails to comply with the UMO's determination, there will be no reduction in benefits as long as the review process takes place, even if the care rendered exceeds that recommended by the UMO.

C. RETROSPECTIVE REVIEW

"Retrospective Review" means the UMO will review the medical need for hospitalization or treatment after such hospitalization or treatment has taken place. This will involve consultation with the Participant's Doctor and comparison of clinical information to professionally developed medical standards of care.

The UMO may evaluate the medical record of those Participants who were not reviewed under pre-admission certification, pre-surgical review, or concurrent review. If the UMO is unable to authorize any portion of the stay or treatment, the Doctor will be contacted to provide additional information. The decision concerning authorization will be made within 30 days after the claim that is the subject of the Retrospective Review is received. If additional information is needed, the Participant or his Doctor or Hospital will be notified within 30 days of receipt of the claim and will have at least 45 days from receipt of the notice to provide the information. If the information is received within 45 days, a decision will be made within 15 days of the day the UMO receives the additional information. If the additional information is not received within the 45 day period, the Participant should consider the claim, or portion thereof that is under review, to be denied. The claim will be reconsidered if the information is subsequently received. Written notice of the decision will be sent to the Participant.

D. PRE-ADMISSION CERTIFICATION/PRE-SURGICAL/CONCURRENT/RETROSPECTIVE

REVIEW REDUCTION IN BENEFITS

If a Participant utilizes a PPO Provider, the PPO Provider is responsible for contacting the UMO. If the PPO Provider does not contact the UMO, the Participant will not be responsible for any pre-admission certification or pre-surgical review reduction in benefits.

If a Participant DOES NOT utilize a PPO Provider, he is responsible for contacting the UMO. If the UMO is not contacted, normal benefits will be reduced by 50%, to a maximum penalty of $500 for each incidence of non-compliance. This penalty will apply to covered Hospital charges and/or surgeon's charges and any related expenses incurred as a result of such confinement and/or surgery before normal benefits of the Plan are calculated.


Regardless of the participation status of the provider, if a Participant fails to comply with the UMO's determination, there will be no reduction in benefits as long as the review process takes place, even if the care rendered exceeds that recommended by the UMO. If the inpatient Hospital Confinement occurs for surgical treatment, only one pre-admission certification or pre-surgical review reduction in benefits will be imposed.

E. DISEASE MANAGEMENT FOR CHRONIC MEDICAL CONDITIONS

Disease Management is a program which provides specialized education to a Participant with a chronic medical condition to improve his health. The Plan will provide Disease Management Program services ("Program") if the Participant meets the Program's pre-determined medical criteria and is expected to benefit from the Program. Under this Program, the Participant will receive services, coordinated by an R.N., consisting of assessment and educational materials for targeted diseases. There is no charge to the Participant for these services. Utilization of the Program's services is voluntary; a Participant is not required to participate in the Program. By providing these services, neither the Plan, the Plan Sponsor, nor its contracted provider promises or guarantees that any intended results will be obtained. The Program does not provide any medical treatment, therapeutic or Home Health Care. It provides for assessment and education in self-management of chronic medical conditions.

F. APPEALS PROCEDURE

"Adverse Determination" means that the Participant's hospital admission, continued hospital stay or other health care service has been reviewed and, based upon the information provided, does not meet the UMO’s requirements for being medically necessary, appropriate, effective or in the proper setting and may result in noncoverage of the health care service. "Authorized Representative" means the Participant’s spouse, parent, Doctor or Hospital. It will also include any other person who submits proof that he has been designated by the Participant or a court of law to act on such person's behalf. A Participant or his Authorized Representative has the right to appeal an Adverse Determination. The address to which to send an appeal and any other contact information will be included with an Adverse Determination. With the exception of Expedited Appeals, two appeals are mandatory before bringing civil action under Section 502(a) of ERISA. Only one Expedited Appeal is required before bringing civil action under Section 502(a) of ERISA. A second Expedited Appeal will be considered a voluntary appeal. If a Participant or his Authorized Representative does not agree with an Adverse Determination, a Participant or his Authorized Representative may initiate the appeal by telephoning, faxing or submitting a written request to the UMO. Additional evidence may be presented for consideration on appeal. Initial appeal requests must be received within 180 days of the initial Adverse Determination. In connection with the Claim Administrator’s review of the appeal, the Participant has the right to 1) see the Plan and other relevant papers affecting the claim, 2) argue against the denial in writing, 3) have a representative act on his behalf in the appeal. All comments, documents, records and other information submitted in connection with the claim being reviewed will be considered.


G. STANDARD APPEAL

Within 15 days of receiving the appeal request, the UMO will notify the person who submitted the appeal of its decision in writing. The appeal will be reviewed by a Doctor who: 1. has appropriate training and experience in the field of medicine involved in the

medical judgment; 2. was not previously involved with the Adverse Determination; and 3. is not the subordinate of the person previously involved with the Adverse

Determination.

H. EXPEDITED APPEAL

If the Standard Appeal process would place the life or health of a Participant in serious jeopardy or the Participant's ability to regain maximum function would be jeopardized, a request for an Expedited Appeal may be phoned in by the Participant, a Doctor with knowledge of the Participant's medical condition or his Authorized Representative. The UMO will conduct the review by telephone or through the exchange of written information. The Participant, his Authorized Representative, and his Doctor will be informed of the decision by telephone or fax within 72 hours of the UMO's receipt of the appeal request. The appeal will be reviewed by a Doctor who: 1. has appropriate training and experience in the field of medicine involved in the

medical judgment; 2. was not previously involved with the Adverse Determination; and 3. is not the subordinate of the person previously involved with the Adverse

Determination. The Participant has a right to request information regarding voluntary appeals procedures. Any statute of limitations or other defense based on timeliness is tolled during the time that a voluntary appeal is pending. The Participant does not have to exhaust voluntary appeals in order to bring civil action under Section 502(a) of ERISA.

I. SECOND APPEAL

A Participant or his Authorized Representative may initiate a Second Appeal of the Adverse Determination by submitting a written request to the UMO within 60 days of the date of the Adverse Determination received as a result of an initial, standard, or expedited appeal. An independent, external reviewer will evaluate all relevant information and render a decision that will be binding on the Plan. The decision will be rendered within 15 days of the date the UMO receives the appeal request. A second Expedited Appeal will be considered a voluntary appeal. Decisions regarding a second Expedited Appeal will be rendered within a time frame appropriate to the medical condition of the patient. There are no other voluntary appeal rights available with respect to the Pre-Admission Certification, Pre-Surgical Review, Concurrent Review or Retrospective Review for Medical Necessity. The Participant has a right to request information regarding voluntary appeals procedures. Any statute of limitations or other defense based on timeliness is tolled during the time that a voluntary appeal is pending. He does not have to exhaust voluntary appeals in order to bring civil action under Section 502(a) of ERISA.


J. EXTERNAL REVIEW PROCESS

1. This section shall apply to appeals of certain decisions under this Article and under Article VIII (“Claims and other Provisions”). The external review process applies only to an Adverse Benefit Determination. An Adverse Benefit Determination for purposes of this Section J. (whether interim or final) is one that:

a. involves medical judgment (including, but not limited to, those based on the Plan's requirements for Medical Necessity, appropriateness, health care setting, level of care, or effectiveness of a covered benefit; or its determination that a treatment is Experimental or investigational), as determined by the external reviewer; or

b. A rescission of coverage (whether or not the rescission has any effect on any particular benefit at that time).

An Adverse Benefit Determination for purposes of this Section J. does not include a denial, reduction, termination, or a failure to provide payment for a benefit based on a determination that a Participant fails to meet the requirements for eligibility under the terms of the Plan.

2. Standard external review is external review that is not considered expedited (as described in Section J.3. below).

a. The Plan will allow a claimant to file a request for an external review with the Plan if the request is filed within four (4) months after the date of receipt of a notice of an Adverse Benefit Determination or final internal Adverse Benefit Determination. If there is no corresponding date four months after the date of receipt of such a notice, then the request must be filed by the first day of the fifth month following the receipt of the notice. For example, if the date of receipt of the notice is October 30, because there is no February 30, the request must be filed by March 1. If the last filing date would fall on a Saturday, Sunday, or Federal holiday, the last filing date is extended to the next day that is not a Saturday, Sunday, or Federal holiday.

b. Within five (5) business days following the date of receipt of the external review request, the Plan will complete a preliminary review of the request to determine whether:

(i) The claimant is or was covered under the Plan at the time the health care item or service was requested or, in the case of a retrospective review, was covered under the Plan at the time the health care item or service was provided;

(ii) The Adverse Benefit Determination or the final Adverse Benefit Determination does not relate to the claimant’s failure to meet the requirements for eligibility under the


terms of the Plan (e.g., worker classification or similar determination);

(iii) The claimant has exhausted the Plan’s internal appeal process unless the claimant is not required to exhaust the internal appeals process under the interim final regulations; and

(iv) The claimant has provided all the information and forms required to process an external review.

Within one (1) business day after completion of the preliminary review, the Plan will issue a notification in writing to the claimant. If the request is complete but not eligible for external review, such notification will include the reasons for its ineligibility and contact information for the Employee Benefits Security Administration (toll-free number 866-444-EBSA (3272)). If the request is not complete, such notification will describe the information or materials needed to make the request complete and the Plan will allow a claimant to perfect the request for external review with the four-month filing period or within the 48 hour period following the receipt of the notification, whichever is later.

c. The Plan will assign an independent review organization (IRO) that is accredited by URAC or by a similar nationally-recognized accrediting organization to conduct the external review. Moreover, the Plan will take action against bias and to ensure independence. Accordingly, the Plan will contract with (or direct the Claims Administrator to contract with, on its behalf) at least three (3) IROs for assignments under the Plan and rotate claims assignments among them (or incorporate other independent unbiased method for selection of IROs, such as random selection). In addition, the IRO may not be eligible for any financial incentives based on the likelihood that the IRO will support the denial of benefits.

d. Upon receipt of a notice of a final external review decision reversing the Adverse Benefit Determination or final internal Adverse Benefit Determination, the Plan will provide coverage or payment for the claim without delay, regardless of whether the Plan intends to seek judicial review of the external review decision and unless or until there is a judicial decision otherwise.

3. The following applies to an expedited external review.

a. The Plan will allow a claimant to make a request for an expedited external review with the Plan at the time the claimant receives:

(i) An Adverse Benefit Determination if the Adverse Benefit Determination involves a medical condition of the claimant for which the timeframe for completion of a standard


internal appeal under the interim final regulations would seriously jeopardize the life or health of the claimant or would jeopardize the claimant's ability to regain maximum function and the claimant has filed a request for an expedited internal appeal; or

(ii) A final internal Adverse Benefit Determination, if the claimant has a medical condition where the timeframe for completion of a standard external review would seriously jeopardize the life or health of the claimant or would jeopardize the claimant's ability to regain maximum function, or if the final internal Adverse Benefit Determination concerns an admission, availability of care, continued stay, or health care item or service for which the claimant received emergency services, but has not been discharged from a facility.

b. Immediately upon receipt of the request for expedited external review, the Plan will determine whether the request meets the reviewability requirements set forth in Section J.2.b. above for standard external review. The Plan will immediately send a notice that meets the requirements set forth in Section J.2.B. above for standard external review to the claimant of its eligibility determination.

c. Upon a determination that a request is eligible for external review following the preliminary review, the Plan will assign an IRO pursuant to the requirements set forth in Section J.2.c. above for standard review. The Plan will provide or transmit all necessary documents and information considered in making the Adverse Benefit Determination or final internal Adverse Benefit Determination to the assigned IRO electronically or by telephone or facsimile or any other available expeditious method.

d. The assigned IRO, to the extent the information or documents are available and the IRO considers them appropriate, will consider the information or documents described above under the procedures for standard review. In reaching a decision, the assigned IRO will review the claim de novo and is not bound by any decisions or conclusions reached during the Plan’s internal claims and appeals process.

e. The Plan’s (or Claim Administrator’s) contract with the assigned IRO will require the IRO to provide notice of the final external review decision, in accordance with the requirements set forth above, as expeditiously as the claimant’s medical condition or circumstances require, but in no event more than 72 hours after the IRO receives the request for an expedited external review. If the notice is not in writing, within 48 hours after the date of providing that notice, the assigned IRO will provide written confirmation of the decision to the claimant and the Plan.


ARTICLE VIII CLAIMS AND OTHER PROVISIONS

A. CLAIM DECISIONS

Affirmative proof of a medical claim must be furnished to the Company through the Claim Administrator within 12 months following the end of the calendar year in which the claim is incurred.

1. Decisions on medical claims will be made within 30 days of the date the Claim Administrator receives the claim. If a decision cannot be made for reasons beyond control of the Plan, the Claim Administrator will notify the Participant of:

a. the reason for the delay;

b. any information needed to perfect the claim; and

c. the date by which the Claim Administrator expects to make a decision.

A Participant will have 45 days from the date of receipt of the notice to provide the requested information. If the Claim Administrator receives the necessary information within the 45-day time frame, a decision will be made within 15 days of receipt of the information, unless the Participant agrees to a longer period of time. If the Participant does not provide the requested information within this time period, he should consider the claim to be denied. This denial will be reconsidered if the information is subsequently received.

2. Decisions on claims involving Pre-Admission Certification/Pre-Surgical Review, Concurrent Review or Retrospective Review will be made in accordance with the procedures shown (as set forth in Article VII).

3. In the event a claim is denied in whole or in part, the Participant will be notified in writing of the following:

a. the reason for denial;

b. specific reference to the Plan provisions on which the denial was based;

c. any additional material or information needed for further review of the claim;

d. an explanation of the Plan's review procedure and time limits;

e. the right to bring civil action under Section 502(a) of ERISA after required Plan appeals have been exhausted;

f. with respect to medical claims, the specific rule, guideline, protocol or similar criterion, if any, that was relied upon in deciding the claim, or a statement that such was relied upon and is available upon request:

g. with respect to medical claims, an explanation of the scientific or clinical judgment for determining a denial based on a medical judgment, Medical Necessity, or treatment that is experimental, Investigational or unproven, or a statement that such explanation is available free of charge upon request.

"Authorized Representative" means the Participant’s spouse, parent, Doctor or Hospital. It will also include any other person who submits proof that he has been designated by the Participant or a court of law to act on such person's behalf. 4. If a claim is denied in whole or in part, the Participant or his Authorized Representative

may appeal the denial by making a written request for review to the Claim Administrator within:

a. 180 days of the time the Participant receives the notice of denial of the initial claim or within 60 days of the time he receives the notice of denial of his first appeal with respect to medical claims;


b. 60 days of the time the Participant receives the second notice of denial for the purpose of submitting a voluntary appeal.

In connection with the Claim Administrator’s review of the appeal, the Participant has the right to 1) see the Plan and other relevant papers affecting the claim, 2) argue against the denial in writing, 3) have a representative act on his behalf in the appeal. All comments, documents, records and other information submitted in connection with the claim being reviewed will be considered.

With respect to medical claim reviews, the review will be conducted by someone other than the person who made the initial determination. If the initial denial was based on a medical judgment, Medical Necessity or treatment that is experimental, Investigational or unproven, a health care professional with appropriate training in the field of medicine that is the subject of the claim will be consulted. If the claim is still denied in whole or in part, the Participant will again be advised as per items a. through g., above, along with his right to request information regarding any voluntary appeals provided under the Plan once the required appeals have been exhausted. Two appeals are required prior to filing suit under Section 502(a) of ERISA. Voluntary appeals are not applicable to decisions involving Medical Necessity or treatment considered to be experimental, Investigational or unproven.

The decision on the appeal shall be in writing, and shall be made within 30 days of the date the Claim Administrator receives the request for review with respect to medical claims.

The decision shall include specific reasons for the denial, written in an understandable manner and shall contain specific reference to the pertinent Plan provisions on which the decision was based.

Once the required appeals previously described have been exhausted, additional appeals are allowed on a voluntary basis upon request for medical claims. There are no voluntary appeal rights following the previously described appeal process when the denial was based on Medical Necessity or on a determination that the treatment was considered experimental, Investigational or unproven. The Participant has a right to request information regarding voluntary appeals procedures. Any statute of limitations or other defense based on timeliness is tolled during the time that a voluntary appeal is pending. The Participant does not have to exhaust voluntary appeals in order to bring civil action under Section 502(a) of ERISA.

5. Certain claims may be appealed pursuant to the external review process described in Article VII.J.

B. PAYMENT OF CLAIMS

1. Benefits for services rendered by a PPO provider shall be paid directly to the provider of services.

2. Benefits for services rendered by a non-PPO provider will be paid to the Participant, unless authorization is given by the Participant that payment be made to the provider.

3. If, in the opinion of the Claim Administrator, a Participant, by or for whom a claim has been made, is incapable of furnishing a valid receipt for any payment due him in the absence of written evidence of the Plan Administrator of the qualification of a guardian for his estate, the Plan Administrator may, at its sole discretion, make any and all such payments to the individual or institution which, in the opinion of the Plan Administrator, is providing the care and support of such Participant.


C. FACILITY OF PAYMENT

1. All benefits shall be paid as stated above, except in the event of death of a covered employee, the Company may pay benefits, not validly assigned, to natural persons who are the employee’s beneficiaries under the Company Life Insurance Plan. A minor who is a beneficiary shall not be paid. If there is no eligible beneficiary, unpaid benefits shall be paid to the estate of the employee.

2. The Company may pay all or any benefits for covered expenses to the hospital,

other such institutions, or the person giving medical or dental care or supplies.

3. Any payments made according to the above paragraphs will discharge the Company to the extent of the payment. The Company shall not be bound to supervise the use of money so paid.


ARTICLE IX COORDINATION OF BENEFITS

If a Participant is also covered under any other plan (as defined below), the benefits under this plan will be adjusted to the extent provided in this Article so as to take into account the benefits or services under such other plan. A. DEFINITIONS

As used in this Article IX, 1. Coordinating Plan means a plan listed below which provides medical or health benefits or

services:

a. a group or blanket plan on an insured basis;

b. another plan which covers individuals or members as a group;

c. a self-insured or non-insured plan or other plan which is arranged through an employer, trustee, union, employer organization or employee benefit organization;

d. a prepayment plan which provides medical or health service;

e. government plans or coverage required by law;

f. group auto insurance;

g. no-fault auto insurance on an individual basis;

h. individual or family subscribed plans issued under a group or blanket if type plan.

2. The definition of Coordinating Plan shall not include:

a. hospital indemnity type plans;

b. plans covering students, except college students.

Each plan, as defined above, is a separate plan. However, if only a part of the plan reserves the right to adjust its benefits due to other coverage, the portion of the plan which reserves that right and the portion which does not shall be treated as separate plans.

3. Allowable Expense means a necessary, reasonable and customary item of medical or health expense which is covered at least in part under one of the plans. If a plan provides benefits in the form of services, the cash value of the service will be deemed to be the benefit paid.

4. Benefit Determination Period means January 1 of one year through December 31 of the

same year.


B. BENEFIT DETERMINATIONS

This provision shall apply in computing the benefit of a Participant for a Benefit Determination Period, and the benefits under this plan shall be subject to the following: 1. If coverage under a Coordinating Plan is involved, and

a. that Coordinating Plan contains a coordination of benefits provision which would

by its rules determine its benefits after the benefits under this plan have been determined, and

b. the terms in Item 3. below make this plan primary and require it to determine its

benefits before the other plan, then the benefits under this plan will be determined as though another plan were not involved.

2. If coverage under a Coordinating Plan is involved and the terms in Item 3. below make the

Coordinating Plan secondary, then the benefits under this plan will be determined, with respect to each coverage, as though the provisions of the other Coordinating Plan were applied to the benefits of this plan. This plan will pay such additional amounts as are necessary to fulfill the benefits of this plan. Benefits under other Coordinating Plans shall be taken into account whether or not a claim has been made.

3. For the purposes of Items 1. and 2. above, the basis for establishing the order in which

plans determine benefits shall be as follows:

a. Benefits under the Coordinating Plan which covers the person for whom a claim is made as an employee or member shall be determined before the benefits under a plan which covers the person as a dependent.

b. The benefits of a Coordinating Plan which covers the person for whom a claim is

made as a dependent of the parent whose birth date falls earlier in the calendar year shall be determined before the benefits of a Coordinating Plan which covers the person as a dependent of the parent whose birth date falls later in the calendar year. If both parents have the same birthday, the benefits of the Coordinating Plan of the parent who has covered the dependent longer will be determined first. Year of birth is not taken into account. (If the plan with which this plan is to be coordinated does not follow these birth date guidelines, then the other plan will govern which plan is primary.) However, (i) when the parents are separated or divorced and the parent with custody of

the child has not remarried, the benefits of a Coordinating Plan which covers the child as a dependent of the parent with custody of the child will be determined before the benefits of a Coordinating Plan which covers the child as a dependent of the parent without custody.

(ii) When the parents are divorced and the parent with custody of the child has remarried, the benefits of a Coordinating Plan which covers the child as a dependent of the parent with custody shall be determined before the benefits of a Coordinating Plan which covers that child as a dependent of the step-parent. The benefits of a Coordinating Plan which covers that child as a dependent of the step-parent will be determined before the benefits of a Coordinating Plan which covers that child as a dependent of the parent without custody.


Notwithstanding items (i) and (ii) above, if there is a court decree which would otherwise establish financial responsibility for the medical, vision, dental or health care expenses with respect to the child, the benefits of a Coordinating Plan which covers the child as a dependent of the parent with financial responsibility shall be determined before the benefits of any other Coordinating Plan which covers the child as a Dependent.

c. When (a.) and (b.) above do not establish the order of benefit determination, the Coordinating Plan which covers the individual on whom the claim is based for the longer time shall be determined first.

4. When this provision operates to reduce the benefits under this plan, each benefit that would

have otherwise been paid will be reduced proportionately and the reduced amount shall be charged against the benefit limits of this plan.

C. EXCESS COVERAGE

If one of the other Coordinating Plans involved provides benefits on an excess insurance or excess coverage basis, Items 1, 2, and 3 of the Benefit Determinations provision shall not apply to that plan and this plan will pay as excess coverage.

D. INFORMATION RIGHTS

The Claim Administrator may, without the consent of the employee, or the employee's spouse when the claim is for a spouse, or the parent or guardian when the claim is for a minor child, release or obtain any data which is needed to implement this provision. Any Individual enrolled in this Plan shall automatically give consent by such enrollment to this provision and any Individual claiming Benefits under this Plan shall, as a condition precedent thereto, furnish to the Company such information as may be necessary to implement this provision.

E. PAYMENT ADJUSTMENTS

When payments should have been paid under this Plan, but were already paid under some other Coordinating Plan, the Claim Administrator shall have the right to pay to the other plan the amount which would satisfy the intent of this provision. This payment shall discharge the Company's liability under this plan.


ARTICLE X MEDICARE

A. ELECTION OPTIONS

1. A covered Employee who attains age 65 is given the option of continuing coverage under this Plan after electing Medicare.

2. The spouse of a covered Employee who attains age 65, whether or not the Covered Employee has attained age 65, will also be given the option of continuing coverage under this plan after electing coverage under Medicare.

3. A Participant who becomes entitled to Medicare due to a disability will have the same election options as an individual who has attained age 65.

B. COVERAGE OPTIONS

1. When coverage under this Plan is elected, Medicare will provide supplemental coverage for the individual making the election.

2. Coverage under this plan, after it has been elected under Medicare provisions, is the same as coverage provided to all active covered employees and dependents.

C. EFFECT OF ELIGIBILITY FOR MEDICARE COVERAGE FOR DISABLED FORMER

EMPLOYEES

Benefits for Disabled Former Employees and their Eligible Dependents are subject to the restrictions of this provision.

1. Determination of Benefits

In the event that a Participant is eligible for Federal Medicare, the benefits that are payable under this Plan for Allowable Expenses incurred by or on behalf of such person shall be reduced to the extent necessary, so that the sum of such reduced benefits and all benefits paid or payable under Medicare shall not exceed the total of such Allowable Expenses that would otherwise have been payable under this Plan in the absence of Medicare. Benefits payable under Medicare shall be deemed to include:

a. The benefits that would have been payable under Part A and Part B of "Medicare" had claim been duly made therefore, and if the Participant had enrolled for such coverage, then Medicare benefits shall be determined in accordance with the deductible and coinsurance factors then applicable under Medicare, and in accordance with the Covered Expense Definition of this Plan.

b. Any benefits paid or payable by another group health plan due to its obligation to provide benefits without regard to Medicare coverage for an actively working employee or a dependent of such person. For purposes of this Section C.1., "Allowable Expense" means any necessary, reasonable and customary item of medical or health expense at least a portion of which is covered under at least one of the plans covering the person for whom claim is made; provided, however, that 1) in the case of a plan which provides benefits in the form of services rather than cash payments, the reasonable cash value of each service rendered shall be deemed to be both an Allowable Expense and a benefit paid and 2) in the event that this plan contains a preferred provider feature whereby a provider has agreed to a discounted or reduced charge for Participants in this plan, the amount of such discount or reduction shall not be considered an Allowable Expense.


2. Right to Receive Necessary Information

For the purposes of determining the applicability of, and implement the terms of this provision of this Plan, the Plan Administrator may require that the Participant claiming benefits under this Plan shall furnish to the Plan Administrator such Medicare payment or enrollment information as may be necessary to implement this provision.

3. Right to Recovery

Whenever payments have been made by the Plan with respect to Allowable Expenses in a total amount, at any time, in excess of the maximum amount of payment necessary at that time to satisfy the intent of this provision, the Plan Administrator shall have the right to recover such payments to the extent of such excess from persons to, or for, or with respect to whom such payments were made.


ARTICLE XI NAMED FIDUCIARIES

A. DELEGATION OF DUTIES

1. The Company shall be named fiduciary of the Plan, pursuant to and as defined in ERISA.

2. Any named person or group of persons may serve in more than one fiduciary capacity with respect to the Plan. Each individual named fiduciary under the Plan shall be allocated one or more responsibilities specified below and shall have discretionary authority to take such actions as are necessary to fulfill a responsibility.

3. Any named fiduciary may employ one or more persons to render advice with respect to any

responsibility allocated to the named fiduciary under the Plan.

4. Any named fiduciary may designate in writing a person other than a named fiduciary to carry out all or a portion of the named fiduciary's allocated fiduciary responsibilities as set forth in a written instrument executed by the named fiduciary, the designated person, and the Company.

B. LIABILITY

No named fiduciary shall be liable with respect to a breach of fiduciary duty, if a breach was committed before he became a named fiduciary or after he ceases to be a named fiduciary.

C. AUTHORITY OF THE FIDUCIARY

The fiduciary shall have the sole authority to: 1. Amend and/or terminate the Plan in accordance with Article XIII thereof.

2. Make changes as it deems prudent from time to time in the funding policy of the Plan.

3. Make rules as may be necessary for administration of the Plan, make determinations as to

eligibility, benefits and the amount of benefits, construe the Plan subject to its provisions, supply any omissions and reconcile any inconsistencies, make equitable adjustments for any mistakes or errors and decide all questions arising in the interpretation of the Plan all of which shall be conclusive and binding on all parties.

4. Formulate the claims procedures of the Plan.

5. Provide a full, fair and final review of any claim denied by the Plan or by the Claim

Administrator, if any, retained by the Company in accordance with the Plan's claims procedures.

D. DUTIES OF THE PLAN ADMINISTRATOR

The Company shall serve as Administrator of the Plan for purposes of ERISA and perform the following duties: 1. Comply with the requirement of ERISA with respect to the plan description, summary plan

description, annual report and other reports to be provided to the Secretary of Labor and/or Participants.


2. Establish, prepare and maintain all records required for completion of reports to Participants and to governmental agencies.

3. Retain, at its option, a Claim Administrator to be responsible for all or any portion of the

day-to-day administration of the Plan, including determination of claims.

4. Retain, at its option, an actuarial or benefit plan consultant to be responsible for all or any portion of day-to-day administration of the Plan, actuarial evaluation, and necessary funding.

E. CLAIM ADMINISTRATOR

The Claim Administrator shall perform the duties specified in any separate Administrative Services Agreement entered into between the Claim Administrator and the Company, the terms and provisions of which shall be incorporated herein by reference to the same extent as if herein written. Likewise, the actuarial or benefit plan consultant shall perform the duties specified in any separate consultative services agreement entered into between the actuarial or benefit plan consultant and the Company, the terms and provisions of which shall be incorporated herein by reference to the same extent as if herein written.


ARTICLE XII FUNDING POLICY AND BASIS OF PAYMENTS TO AND FROM PLAN

A. CONTRIBUTIONS

Contributions to the Plan by the Company shall be made to the Trust in amounts determined by the Company and in accordance with the obligations of the Trust Document.

B. PLAN ASSETS

Plan assets may be used for the following: 1. Payment of plan benefits to Participants.

2. Defraying reasonable expenses of plan administration and/or consultation.

3. Payment of any reinsurance premiums necessary to purchase excess risk protection on any

portion of the Plan's benefit liability.

The provisions of the Trust will determine the uses of its assets.


ARTICLE XIII AMENDMENT OR TERMINATION OF PLAN

A. AMENDMENT AND TERMINATION

The Company reserves the right, in its sole discretion, to terminate, suspend, withdraw, amend or modify the Plan in whole or in part at any time, including, without limitation, the right to amend the Plan to require Participant contributions or to increase the amount of contributions that Participants must make to the Plan.

B. DISPOSITION OF ASSETS FOLLOWING TERMINATION

In the event of any remaining plan assets following Plan termination, those assets that remain after fulfillment of all Benefit payments and other expenses and obligations (as set forth in Article XII) shall be disbursed to the Company in an amount not to exceed the total cumulative contributions made to the Plan by the Company during the period which commences January 1, 1990, and ends as of the date of termination of the Plan.


ARTICLE XIV GENERAL PROVISIONS

A. SEX AND NUMBER

When used in the Plan, the masculine includes the feminine, the singular the plural and the plural the singular.

B. PHYSICAL EXAMINATION AND AUTOPSY

The Company shall have the right and opportunity to examine the person with respect to whom benefits are claimed when and so often as they may reasonably require while a claim is pending hereunder, and also the right and opportunity to make an autopsy, where it is not forbidden by law.

C. LEGAL ACTIONS

No action at law or in equity shall be brought to recover under the Plan prior to the expiration of 60 days after proof of claim has been filed in accordance with the requirements of the Plan and the Plan's claims procedures, nor shall an action be brought at all unless brought within three years from the expiration of the time within which proof of claim is required in accordance with the Plan's claims procedures.

D. NOT WORKERS' COMPENSATION INSURANCE

The coverage provided by the Plan is not in lieu of and does not affect any requirements of coverage by Workers' Compensation Insurance.

E. ASSIGNMENT OF BENEFITS AND CLAIMS OF CREDITORS

1. The employee may assign the benefits under this plan only to a Provider rendering services or furnishing supplies for which benefits are payable. The Company shall not be responsible for the validity of any assignment. Any payment made according to the assignment and in good faith by the Company will discharge the Company to the extent of the payment.

2. To the extent permitted by law, neither the benefits nor payments under this plan will be

subject to the claim of creditors or to any legal process by any creditor of the Participant or beneficiary.

F. APPLICABLE LAW

The Plan shall be construed and enforced in accordance with the laws of the State of Missouri except to the extent pre-empted by ERISA.

G. CONFORMITY WITH THE LAW

Except to the extent preempted by ERISA or other applicable federal statutes, regulations, decrees, or mandates, any provision of the Plan which on its Effective Date, or at any time thereafter, is in conflict with the statutes, regulations, decrees, or other mandates of any state, the U.S. government, any agency having jurisdiction, or any court of competent jurisdiction is hereby amended to conform to the minimum requirements of those orders.

Except to the extent preempted by ERISA or other applicable federal statutes, regulations, decrees, or mandates, any act of administration of this Plan which is in conflict with the statutes, regulations, decrees, or other mandates of any state, the U.S. Government, any agency having


jurisdiction, or any court of competent jurisdiction will be considered null and void and all provisions of the Plan will be construed as if the eradicated action never occurred.

H. RECOVERY RIGHT

When the payments made under this plan are in excess of the amount required to satisfy the intent of its provisions, the Company shall have the right to recover the excess payment from one or more of the following:

1. any persons to whom, for whom, or with respect to whom payments were made;

2. any insurance companies;

3. any other organization.

I. RECOVERY FROM THIRD PARTIES

1. In the event that a Participant sustains a bodily injury or condition which occurs as a result of the conduct of a third party, the Plan is not obligated to pay benefits for medical expenses incurred in connection with such injury or condition unless or until the Participant or someone legally qualified and authorized to act for the Participant promises in writing to:

a. include such expenses in any claim the Participant makes against a third party for the injury or conditions; and

b. reimburse the Plan for any such benefit payments to the extent that the proceeds of the Participant's recovery from a settlement with a third party by reason of such an injury or condition; repayment to the Plan to be made within 30 days of the receipt of such proceeds; and

c. cooperate fully with the Plan in asserting its subrogation rights as set forth below, to supply the Plan with any and all information and execute any and all instruments the Plan reasonably needs for that purpose.

2. In the event of payment for medical expense under the Plan, the Plan shall be subrogated to the extent of such payment to all claims and right which the Participant may have or assert for recovery because of the conduct of a third party which is claimed to have caused or contributed to cause such medical expense.

3. The Plan shall be subrogated to any payment by a third party to a Participant for past medical expenses reimbursed by the Plan as follows:

a. If any amount is awarded by means of a verdict after a full and complete trial and the judgment or verdict form itemized by separate finding or special interrogatory the amount awarded for past medical expenses incurred, such amount shall be binding on the Plan and the Participant as the amount of past medical expenses to which the Plan is subrogated.

b. If there exists any contract or policy of insurance by which past medical expenses are paid (other than a contract or policy of health care, hospitalization or disability insurance issued to and in the name of such Participant), the Plan shall be subrogated to and deemed secondary or excess insurance to such contract or policy.


c. If any amount is paid to a Participant by means of a settlement or general judgment or verdict which does not itemize components of damage, the portion of such settlement which will be considered attributable to past medical expenses shall equal the dollar amount of the medical expenses paid by the Plan with respect to the injury, illness or any related condition which the settlement or judgment is intended to compensate the Participant for up through and including the date of the settlement or judgment. The amount so determined shall be binding on the Plan and the Participant as the amount of past medical expenses to which the Plan is subrogated.

If, however, the facts and circumstances presented by any particular situation are such that the percentage of the settlement or judgment which is determined to be attributable to past medical expenses in accordance with this subparagraph c. is disproportionately large in relation to the total settlement or judgment, then the Plan Administrator, in its sole and absolute discretion, may agree to treat a lesser percentage of the total settlement or judgment than would otherwise be required by reason of this subparagraph c. as attributable to past medical expenses. The amount so determined shall be binding on the Plan and the Participant as the amount of past medical expenses to which the Plan is subrogated.

In any amount awarded under subsection a., the total amount of past medical expenses to which the Plan is subrogated shall be reduced by, and in determining the amount to which the Plan is subrogated under item c., consideration shall be given to:

(i) the amount of proportionate or comparative fault assessed against the Participant which reduces the amount of total past medical expenses which are paid by the other;

(ii) the amount of attorney's fees and costs and expenses incurred by the Participant in obtaining the judgment, verdict or settlement (the amount so attributable shall be the same percentage of fees, costs, and expenses as the percentage of past medical expenses bears to the entire damage award or settlement);

(iii) the amount not collectible;

(iv) the deductible amounts or amounts paid by the Participant which were not indemnified by the Plan. In addition, in determining the amount of past medical expenses paid under subsection c. above, consideration shall be given to the percentage of the total past medical expenses paid by one who is jointly liable with another, the other remaining liable.

When any amount is paid or payable pursuant to subparagraph a., b., or c. above, the Participant shall immediately pay to the Plan such amounts as determined above which represent reimbursement for past medical expenses incurred by the Participant and paid by the Plan, but in any event, such payment shall be made not later than 30 days following the date on which such determination is made. The medical expenses represented by any amount so paid to the Participant and/or the Plan shall not be treated as covered expenses incurred under this Plan for purposes of satisfying any of the provisions of this Plan with respect to the deductible or copayment requirements. The subrogation interest of the Plan to payments made under subparagraph a., b., or c. shall apply to all amounts made under any or all sections but shall not exceed the total payments made by the Plan.


4. The Plan shall be subrogated for any payment by a third party to a Participant for future medical expenses paid pursuant to a judgment, settlement or contract on the following basis.

a. If any amount is awarded by means of a verdict after a full and complete trial and the judgment or verdict form itemized by separate finding or special interrogatory the amount awarded for future medical expenses, such amount shall be binding on the Plan and the Participant as the amount of future medical expenses to which the Plan is subrogated.

b. If there exists any contract or policy of insurance by which future medical expenses are paid (other than a policy or contract of health care, hospitalization or disability insurance issued to and in the name of such Participant), the Plan shall be subrogated to and deemed secondary or excess insurance to such contract or policy and amounts paid thereby.

c. If any amount is paid to a Participant by means of a settlement or general judgment or verdict which does not itemize components of damage, the Plan Administrator and the Participant shall agree on the amount which is attributable to future medical expenses. In the event that the Plan Administrator and the Participant cannot agree on the amount which is attributable to future medical expenses, then the Plan Administrator, in its sole and absolute discretion, shall determine the amount attributable to future medical expenses.

In any amount awarded under item a., the total amount of future medical expenses to which the Plan is subrogated shall be reduced by, and in determining the amount to which the Plan is subrogated under item c., consideration shall be given to: (i) the amount of proportionate or comparative fault assessed against the Participant which reduces the amount of total future medical expenses which are paid by the other; (ii) the amount of attorney's fees and costs and expenses incurred by the Participant in obtaining the judgment, verdict or settlement (the amount so attributable shall be the same percentage of fees, costs and expenses as the percentage of future medical expenses bears to the entire damage award of future medical expenses bears to the entire damage award or settlement); (iii) the amount not collectible. In addition, in determining the amount of future medical expenses paid under subsection c. above, consideration shall be given to the percentage of total future medical expenses paid by one who is jointly liable with another, the other remaining liable, any discount for present value of future expenses, and any discount for possibilities of incurring the claimed future medical expenses.

When any amount is paid or payable pursuant to subparagraph a., b., or c. above, the Participant shall pay all medical expenses incurred in the future for treatment of the injuries sustained for which the payments under a., b., or c. were made or agreed to be made, and the Plan shall have no responsibility or liability to pay any such future medical expenses, nor shall the amount of any such payment be considered to represent a covered expense incurred under this Plan for purposes of satisfying any of the provisions of this Plan with respect to the deductible or copayment requirements, until the amount under subparagraph a., b., or c. is fully used.

The subrogation interest of the Plan to payments made under subparagraph a., b., or c. shall apply to all amounts made under any or all section.


5. In lieu of the recovery procedures for benefit payments outlined in this part, the Plan Administrator may, in its sole and absolute discretion, accept an assignment of, or separately pursue its subrogation interests to, the Participant's past or future medical expense claims, or both. Such assignment or subrogation claim may only occur by separate, written agreement between the Plan and the Participant, and is valid only in jurisdictions which permit such claims, where such is not against the jurisdiction's public policy, where the Plan may pursue such claims in its own name and right and where otherwise permitted by law.

The Plan Administrator in its sole and absolute discretion may agree to waive subrogation rights to past or future medical expenses. Such waiver shall not automatically occur in any matter. Waivers of the subrogation interest of the Plan may be granted when the expected administrative costs exceed the expected reimbursement or savings to the Plan. Waivers of subrogation interests will generally not be granted if the past medical expenses are greater than $500 or if the total judgment or settlement exceeds $5,000.

Past medical expenses shall mean those medical expenses which have been incurred due to treatment rendered or services received whether or not such expenses have been billed, paid, or reimbursed at the time of the payment event to which the Plan is subrogated. Future medical expenses shall mean those medical expenses for which the Participant has not received services or treatment, but such services or treatment is expected or anticipated to be rendered in the future for injuries caused by the incident for which the third party is alleged to be liable and is making a payment, and for which the Plan would otherwise provide reimbursement or payment.

If any portion of this section on subrogation is deemed to conflict with any other provision of the Plan on coordination of benefits of primary-secondary insurance coverage, the other portion of the Plan shall control and the provisions of this section shall supplement such other provisions to the extent not inconsistent.

J. NOT AN EMPLOYMENT CONTRACT

This Plan shall not be deemed to constitute a contract between the Company and any Participant or to be a consideration for, or an inducement or condition of, the employment of any employee. Nothing in the Plan shall be deemed to give any employee the right to be retained in the service of the Company or to interfere with the right of the Company to discharge any employee at any time.

K. NONDISCRIMINATION

Notwithstanding any provision in the Plan, no Eligible Employee or Dependent shall have his initial eligibility or continued eligibility for coverage determined, denied, restricted, postponed, or otherwise conditioned upon his: (i) health status, (ii) medical condition, (iii) claims experience, (iv) receipt of health care, (v) medical history, (vi) genetic information, (vii) evidence of insurability, or (viii) disability.

The Plan shall not discriminate with respect to participation under the Plan against any health care Provider who is acting within the scope of that Provider’s license or certification under applicable state law. The sole purpose of this provision is to comply with PPACA. This provision does not require the Plan contract with any health care provider willing to abide by the terms and conditions for participation in any PPO with which the Plan may contract. It also does not apply to reimbursement rates.

The Plan may not discriminate against a Participant because of participation in an Approved Clinical Trial.


L. HIPAA NOTICES AND CERTIFICATES OF CREDITABLE COVERAGE

The Employer or Plan Administrator shall provide such written notices and certificates of creditable coverage as may be required under HIPAA.

M. MEDICAL CARE DISCLAIMER

This Plan is established to provide funding for certain medical benefits for employees of Paulo Products Company and their eligible dependents. No agents, representatives, sponsors, administrators, or fiduciaries of the Plan are responsible for the medical care received by any employees or their dependents.

PPO Providers are independent. Paulo Products Company is not responsible for the actions of PPO Providers.

N. RESCISSION

Coverage for a Participant may not be retroactively terminated unless the Participant (or a person seeking coverage on behalf of the Participant) performs an act, practice, or omission that constitutes fraud or makes an intentional misrepresentation of material fact.


EFFECTIVE DATE AND SIGNATURE

This Plan Document establishes the Paulo Products Company Comprehensive Medical Plan effective April 1, 1992 and amended January 1, 2016 except to the extent an earlier date is required for a particular change in which case such change shall be effective on such earlier date. The provisions contained in this Plan Document will be the basis for the Administration of the Plan described herein.

SIGNED at St. Louis, Missouri this 8th day of January, 2016.

Paulo Products Company President

Attest: ___________________________________________ Secretary

Date post:	23-Aug-2020
Category:	Documents
Upload:	others
View:	2 times
Download:	0 times

2016 MEDICAL PLAN · (i) Usual means the fee usually charged to his other private patients for a...

Documents