A.D. FARROW CO. & CENTENNIAL PARKASSOCIATE BENEFITS RENEWAL

May 6, 2010

401(k) Profit Sharing Plan

401(k) Employer Match Reinstatement

Effective May 1, the A.D. Farrow Co. Profit Sharing plan will again include an employer contribution

A 25% match of a participating associate's contribution, up to 6% (i.e. the maximum ER contribution will be 1.5%)

So put, for example, 6% of your pay into an account that grows until your retirement, and the company will add 1.5%, for a total of 7.5%.   

In effect, your money will earn 25% on the first day!

Health Insurance Renewal 2010

Remain with Anthem as our long-term partner

Offer two types of plans through Anthem: OPTION 1 - Traditional Blue Access 4.0 OPTION 2 - Lumenos HSA (Health Savings

Account)

Anthem Traditional Blue Access 4.0

OPTION ONE

Traditional Plan Comparison

$25 Office Visit Co-Pay Prescription -

$15/$50/50% $500 Ind / $1,500 Family Out of Pocket

$3,000/$6,000 $150/20% Emergency

Room $50 Urgent Care

$20 office visit copay Prescription - $10/$30/$60 $1,000 Ind / $2,000 Family Out of Pocket $4,000/$8,000 $200/20% Emergency Room*

$75/Ded, 20% Urgent Care*

Generic drugs unless DAW*

*Follows industry trends.

Anthem Traditional 2009-2010

OPTION 1:Anthem Traditional 2010-2011

Per Pay Deduction Comparison

Class 4 – All Other Associates

$46.04 Associate Only $93.32 Associate +

Spouse $73.19 Associate +

Child $128.40 Family

Class 4 – All Other Associates

$47.50 Associate Only $96.28 Associate +

Spouse $75.51 Associate + Child $132.47 Family

Classes 1-3 not shown here (Motorcycle Sales and Managers ) also increase just 3.2%

Anthem Traditional 2009-2010

OPTION 1:Anthem Traditional 2010-2011

Anthem Lumenos HSA (Health Savings Account)

OPTION TWO

“A high-deductible health plan (HDHP) is a health care plan that charges a lower

premium and has a higher deductible than traditional health care plans.”

Introduction of the HSA

Health Savings Account (HSA) Good for…

…those with single coverage who only go to the doctor a few times a year for preventative visits and have few to no prescriptions;

…those who anticipate reaching/exceeding the individual or family deductible due to known medical expenses;

…those who want to have an opportunity to save tax free for future medical expenses.

Trad vs HSA Plan Comparison

$20 Office Visit Co-Pay

Prescription - $10/$30/$60

$1,000 Ind / $2,000 Family

Out of Pocket $4,000/$8,000 $200/20% Emergency Room $75/20% Urgent Care

Preventative visits covered 100%Non Prev. – 100% after Ded.

Prescription – Medical Ded. applies, then $10/$30/$50

$2,500 Ind / $5,000 Fam

Out of Pocket $3,000/$6,000 100% after Deductible 100% after Deductible

OPTION 1:Anthem Traditional 2010-2011

OPTION 2:Anthem Lumenos HSA 2010-2011

Per Pay Deduction Comparison

Class 4 – All Other Associates

$47.50 Associate Only $96.28 Associate +

Spouse $75.51 Associate +

Child $132.47 Family

Class 4 – All Other Associates $40.83 Associate Only $82.75 Associate +

Spouse $64.90 Associate + Child $113.86 Family

Single Coverage - $173 savings/yr

Classes 1-3 not shown here (Motorcycle Sales and Managers ) also save 11%.

OPTION 1:Anthem Traditional 2010-2011

OPTION 2:Anthem Lumenos HSA 2010-2011

Gary Unmarried Example

Meet Gary Unmarried – YEAR ONEGary Unmarried’s HSA Plan

Health Care Deduction $40.83x 26 =$1,062

HSA Contributions $173

Expenses: Preventative Exam(s) - $350

$350

Paid by Preventative Care benefit at 100%

$350

HSA Balance (Rolls to next year)

$173

Gary Unmarried’s Traditional Plan

Health Care Deduction $47.50x 26 =$1,235

Expenses: Preventative Exam(s) $350

$40 CoPay

Gary Unmarried Example

Meet Gary Unmarried – YEAR TWOGary Unmarried’s HSA Plan

HSA Balance – Roll Over YR 1 + YR 2 $173 + $10/check = $260 $606

Expenses: Preventative Exam(s) - $350Physician visit or prescription drug - $100

$450

Paid by Preventative Care benefit at 100%

$350

Paid from HSA $100

HSA Balance (Rolls to next year) $506

Emily Family Example

Meet Emily Family – YEAR ONEEmily Family HSA Plan

Health Care Deduction $113.86x 26 =$2,960

HSA Contributions $482

Expenses: Preventative Exam(s) - $500Specialist Visit - $800Prescription Drugs - $200

$1,500

Paid by Preventative Care benefit at 100% $500

Paid Out of Pocket $1,000($482 pre tax)

Emily Family Traditional Plan

Health Care Deduction $132.40x 26 =$3,442

Expenses: Preventative Exam(s) - $500Specialist Visit - $800Prescription Drugs - $200

$80 CoPay$20 CoPay$20 CoPay

Paid Out of Pocket $120

Emily Family Example

Meet Emily Family – YEAR TWOEmily Family’s HSA Plan

HSA Contributions $482

Expenses: Preventative Exam(s) - $350Inpatient Surgery - $15,950

$16,300

Paid by Preventative Care benefit at 100% $350

Paid from HSA Account $482

Remainder of Deductible Paid Out of Pocket $2,018

Remainder 100% Covered in Full $13,95

0

Emily Family’s Traditional Plan

Expenses: Preventative Exam(s) - $350Inpatient Surgery - $15,950

$16,300

Office Visit CoPayIndividual Deductible

$60$1,000

Co-Insurance – 20% $2,990

Total Out of Pocket $4,050

How Does an HSA Work?

A high-deductible health plan (HDHP) is a health care plan that charges a lower premium and has a higher deductible than traditional health care plans

• Deductible must be met before insurance pays. Then, insurance coverage is 100% (covered in full).

• There are no Co-Pays in this plan• Preventive Care covered in full• In network prescription drug and physician office

visits are charged at carrier discounted rate

How Does an HSA Work?

Preventative Care – 100% Covered in FullSome of the nationally recommended

preventive services you’ll have coverage for include:• Immunizations • Well Child / Adult Care • Preventative Exam • Prostate Exam • GYN Exam, 1 per Plan Year• Mammogram • Pap Test, 1 per Plan Year

How Does an HSA Work?

YOU own your account. Management of the account is your responsibility

Contributions to savings are made pre-tax from payroll, above and beyond your regular premium deduction

Use it to pay for qualified health care expenses on a tax free basis

The HSA can be funded and used to cover out-of-pocket costs that are not covered by or attributable to the medical plan deductible (e.g., dental, eye glasses, etc.)

How Does an HSA Work?

Allows you to save for future health care expenses (including retirement) by investing your money in various investment platforms

It is an interest bearing account that rolls over year to year

2010 HSA limits are $3,050 for single, $6,150 for employee/child, employee/spouse and family with a catch-up provision of $1,000 for employees 55 and over.

Open Enrollment

Begins May 6, 2010 Ends May 28, 2010 All full time associates are eligible All those enrolling must fill out new

forms, even if you already have coverage

Questions

Resources are available to you: Marisa, x1303 or (614) 499-3595 Kelly, x1210 McGohan Brabender

Kim Collier, Account Manager – (937) 395-4586

If you are interested in the HSA, please make an appt with Kelly or Marisa some time next week, by Friday, May 14