School District of Grafton Health Insurance Coverage Effective

School District of Grafton Health Insurance Coverage Effective January 1, 2013 November 20 th and November 27 th

What will be covered in today’s meeting… • Introductions • Why is a change taking place? • 2013 Plan options and premiums • Fundamentals of a Health Savings Account • Humana insurance plan and member benefits • Banking arrangement – Port Washington State Bank • Life and Disability • Dental • Next Steps • Questions

Introductions Willis is the independent consulting firm assisting the School District and it’s employees. Ryan Barbieri – Senior Vice President Humana will be the new health insurance company providing coverage effective January 1 st. Jon Klett- Large Group Sales Executive Port Washington State Bank is the District sponsored bank for H S A contributions for those electing qualified plan starting January 1 st. Angie Regnitz – Personal Banker

Why the health insurance is changing • District budget for ‘ 12 -’ 13 identified a structural deficit • Health insurance premiums were projected to rise more than 12% and this represents 13% of total District budget • There was a consensus within the Board of Education to explore some of the innovative and consumer driven health options • Many private sector employees enjoy having choices in what coverage is best for them • Change will offer an opportunity with reduced premium share for employees • Puts District in a better position to maximize future savings • Southeastern Wisconsin healthcare is trending at 12%

What has been done leading up to this point? • The Finance Committee, Board of Education, Administration and Willis completed a comprehensive review of insurance options • Broad market study took place for medical, life and disability: • WEA Trust Humana UHC WCA GHT Madison National Epic Met Life Unum Mutual of Omaha Symetra Anthem Principal Insurance carriers were evaluated based upon: 1) Their ability to provide adequate coverage for employees 2) Various service components 3) Provider network access 4) Price 5) Ability to offer consumer driven options and multiple options

What has been done leading up to this point? • Based on this review, the Board decided to make the following insurance company selections: Health Insurance – Humana Life and Disability – Madison National Dental – Met Life (No Change) Flexible Spending Account – Diversified Benefits (No Change) • Employees will have the opportunity to participate in a Consumer Driven Health Plan that will qualify them for an additional benefit…H S A contributions made to a PWSB account for those electing the H S A plan • Disability benefits are changing to better align with current trends in public sector benefits • Those electing H S A plan will have an option for Limited Purpose FSA

Health Insurance Full Premium Comparison WEA Trust $250/$500 Deductible Plan January 1 st, 2012 Humana Traditional Plan $500 / $1, 000 Deductible Plan January 1 st, 2013 Coverage Amount per Month Single $735. 86 Single $692. 54 Family $1, 666. 24 Family $1, 568. 16 Single Medicare $486. 68 / $143. 34* Single Medicare $455. 76 / $134. 23* Family Medicare $973. 36 / $286. 68* Family Medicare $911. 50 / $268. 46* Medicare Special $1, 222. 54 Medicare Special $1, 144. 85 *Premium for medical only coverage where Medicare D is in place for drug coverage

Health Insurance Full Premium Comparison WEA Trust $250/$500 Deductible Plan January 1 st, 2012 Humana H. S. A. Plan $2, 000 / $4, 000 Deductible Plan January 1 st, 2013 Coverage Amount per Month Single $735. 86 Single $551. 62 Family $1, 666. 24 Family $1, 249. 06 Single Medicare $486. 68 / $143. 34* Single Medicare $364. 82 / $122. 52* Family Medicare $973. 36 / $286. 68* Family Medicare $729. 66 / $245. 05* Medicare Special $1, 222. 54 Medicare Special $916. 45 *Premium for medical only coverage where Medicare D is in place for drug coverage

Current Yearly Employee Contribution New Yearly Employee Contribution 12. 6% Trad. 12. 6% H. S. A. 8% Single Plan $1, 113 Single Plan $1, 047 $530 Family Plan $2, 519 Family Plan $2, 371 $1, 199 New Deductible Current Deductible Single Plan $250 Single Plan $500 $2, 000 Family Plan $500 Family Plan $1, 000 $4, 000 Co. Insurance Max Current Co. Insurance Max Single Plan $0 Family Plan $0 Current Worst Case Scenario Single Plan $1, 000 Family Plan $2, 000 Health Savings Account Contribution Single Plan $0 $1, 500 Family Plan $0 $3, 000 ew Worst Case Scenario Co. Pays Excluded Single Plan $1, 363 Single Plan $2, 547 $2, 030 Family Plan $3, 019 Family Plan $5, 371 $4, 199

What Is A H S A Plan

What Is A HSA? • Combines a Qualifying High Deductible Health Plan (HDHP) with a Health Savings Account (HSA) • Funded by the District and / or you • Pre-tax basis by salary deferral and direct deposit for participants • Pay for qualified expenses or save for the future • Annual limit that can be contributed to account • Catch-up contributions (Age 55 and up) up to $1, 000 • Funds accumulate and earn non-taxable interest • The dollars in the HSA are yours! • It remains your money even if you leave the District or retire

What is the HSA Concept? Two Basic Parts: Part 1: Qualifying High Deductible Health Insurance Plan Intended to cover serious illness or injury after the deductible has been met. HSA Concept Part 2: Health Savings Account Pays expenses until the deductible is met.

Who is eligible for a HSA? An “eligible individual” is any individual who, for a given month… • is covered under a qualified highdeductible health plan (HDHP) • Is not also covered by any other health plan unless it is also an HDHP • may not be claimed as a dependent on another person’s tax return. • is not covered by Medicare and receiving benefits

Example of HSA Usage – Tom Employee Coverage Expense Deductible $2, 000 Preventive Care - 1 Physical Exam Coinsurance 90% / 10% For HSA Reimbursement Covered at 100% 4 Office Visits (Non -Preventive) $400 Emergency Room $800 $400 — $400 (Deductible) $800 — $800 (Deductible) Diagnostics $2, 000 $800 Plan pays $1, 080 Tom pays $120 Totals $3, 200 $2, 000 Tom Pays $120 $1, 320 Health Savings Account Total Contribution Less Balance $3, 000 - $1, 320 $1, 680 $1, 500 District Contribution $1, 500 Employee Contribution

Example of HSA Usage – Sarah Employee + Family Coverage Expense Deductible $4, 000 Preventive Care 3 Physical Exams 6 Office Visits (Non-Preventive) Outpatient Surgery 3 Specialist Visits Totals Coinsurance 90% / 10% For HSA Reimbursement Covered at 100% $600 — $600 $10, 500 $3, 400 Plan pays $6, 390 Sarah pays $710 $2, 400 $600 — Plan pays $540 Sarah pays $60 $11, 700 $4, 000 Sarah pays $770 $3, 000 Health Savings Account Total Contribution Less $3, 000 - $3, 000 Balance $0 Sarah’s Responsibility $1, 770 $3, 000 District Contribution $0 Employee Contribution

What form can contributions be made? • Contributions to a HSA must be made in “cash”. For example, contributions may not be made in the form of stock or other property. • Contributions to the HSA can be made through payroll deduction on a pre-tax basis. • The District will contribute $1, 500 for Employee coverage and $3, 000 for Family coverage

How are distributions treated for tax purposes? • Tax Free (Qualifying medical expense) • Ordinary Tax (Non-medical distribution after age 65) • Ordinary Tax + 20% penalty (Non-medical distribution prior to age 65)

When may I take distributions from my HSA? • Your HSA dollars can be taken at any time to pay for qualifying medical expenses. Note: If reimbursing expenses from previous years, you must maintain sufficient records to prove the expense was not previously reimbursed.

Qualified HSA Expenses • Medical, dental, vision deductibles and coinsurance amounts • Certain Long Term Care insurance premiums • COBRA premiums • Hearing aids • Smoking cessation • Wheelchairs • Organ transplants • Medicare premiums

What are qualifying Medical Expenses? • A Qualifying Medical Expense (QME) is generally any expense incurred to maintain your health or your family’s health • A partial list of expenses that can be reimbursed is included with the HSA information • A complete listing provided in Section 213 of IRS Ruling.

New Medical Carrier Humana

My. Humana. com § § § § Focus on personal health management Members manage their health benefits and educate themselves Secure My. Humana home page Tailored employer campaigns to boost My. Humana registration Review health plan benefits View claim activity Financial tools to see how much you are spending Health resources to find information about medications, medical procedures, tests and treatments 22 22 22

National Point of Service (POS) How to Find a Provider 23 23 23

Healthcare Transparency – Humana’s Approach Align tools with the consumer “shopping” thought process § § § 24 24 What’s important to me? What does it cost? Who has the best quality? What are others saying? Make educated decisions and try to avoid surprises

Ease of Use We put the pieces together for our members… § Easy to understand number and graphics § Focus on needs related to the entire treatment period instead of presenting information “a la carte” and point-intime § Transparency content is fully integrated in the Humana My. Choice tools According to Forrester Research, 63% of consumers don’t know treatment costs for any procedure until the medical bill arrives – and 10% never know. 25 25

Provider Cost Transparency Simple and easy access on My. Humana. com For Grafton School District employees who are planning for a health procedure – or helping a family member, cost information allows them to make a decision they feel good about. . . and perhaps save money in the process. 26 26

Provider Cost Transparency Physician Dr. John Doe Grafton School District members are provided with a total estimated cost for in and out-ofnetwork and additional information highlighted above. 27 27

Provider Cost Transparency Outpatient Procedures & Tests Lower costs with credentialed providers means more money stays in the pockets of Grafton School District employees 28 28

Vitals. com Humana furthers its industry leadership in the transparency space by being the only insurer to provide this level of physician transparency 29 29

Pharmacy Tools Drug Pricing Rx. Calculator Right. Source. SM prescription home delivery service Pharmacy locator Drug lists and forms 30 30

Drug Pricing § Find out if a drug is covered § View estimated prices, based on your pharmacy benefit and the pharmacy you select § Explore alternatives 31 31

Employee Assistance Program/Work-Life Confidential, professional assistance to address personal issues that may impact job performance. Services for Employees from substance abuse to personal finances and legal matters Services for Managers from addressing chemical dependency issues to dealing with workplace conflict Survey respondents reported seventy-three percent of employees who responded report having improved focus and production at work after using EAP/work-life services. Grafton School District employees can choose from an unlimited telephonic service or up to 3 visit in-person EAP program! 32 32

Supporting your employees 33 33 § Depression § Stress § Grief § Legal § Eldercare § Substance Abuse § Childcare § Education § Adoption § Family Support § Parenting § Financial

Comprehensive Work-Life Services Supporting Your Employees § Unlimited access to internet § Financial consulting based tools and resources services –Life topic articles, practical help and information –Video/podcasts on all major life stages –Health care and legal libraries § Additional Information –Financial calculators for Retirement, Saving & Mortgage –Homework help –Concierge services –Alternative health information 34 34 –Budgeting –Debt management –Home buying/refinancing –Retirement planning § Resource Locators –Child Care –Elder Care –Counselor § Legal services –Estate planning –Power of Attorney

Launching in the first quarter of 2013 35 35

A Simple Three-Step Approach 1. Know your health 2. Improve your health § Health Assessment Set Goals and engage in activities focused on: § Vitality Check § Education 3. Earn rewards § Engagement = Reward § Use points to redeem gifts § Prevention § Fitness § Healthy Living Humana Life. Synch Concentra (Biometrics) Health Coaching Concentra (Treatment) Humana. Vitality. SM 36 36 Vitality Shopping Mall™

Complete a health risk assessment (HRA) 37 37

Set goals to maintain health 38 38

Humana. Vitality Standard Activities Member can take over 30 actions to improve their health status. Automatic feeds allow for accurate monitoring and direct link between action, health status and incentives. 39 39

Grafton School District benefits, too FORWARD THINKING: A proactive investment EASY: Seamless execution and minimal disruption EMPLOYEE PERFORMANCE: Healthier, more productive workforce CLAIMS EXPERIENCE: Could have a positive effect on your bottom line 40 40

Telephonic Health Coaching § § 41 41 Explore behaviors that impact one’s life Coaching performed by certified health education specialists and registered nurses Criteria-based coaching aligned with readiness to change and motivation Tailored web program that delivers: – Written personalized action plan – Series of newsletter based on the individual assessment Members choose from one of seven telephonic health coaching programs Include inbound and outbound coaching with goal setting and progress tracking creating a personalize action plan

Real Results Weight Management Tobacco Cessation § 72% said they had lost weight after 30 days of beginning the program • Over 58% remained smoke free after 90 days in the program § On average, over a 5% reduction in health-related absenteeism reported in the first 30 days 42 42 Nutrition § 73% made nutritional improvements within 30 days § On average, nearly a 25% decrease in absenteeism related to health reported in the first 90 days Stress Management § Nearly 65% decreased personal symptoms of stress within 30 days Back Care § On average, a 15% reduction in healthrelated absenteeism reported in the first 30 days

Guidance and Support - Personal Nurse § Registered nurse develops long-term, trusted relationship with member § Engages members to become more educated and more actively involved in health care decision-making § Supports consumers by – – Building a relationship Giving personalized education and guidance Teaching how to most effectively use benefits Identifying roadblocks to improved health The bottom line 84% of participants say they feel more prepared to manage their own health 43 43

Personalized Care & Support Guidance & Support – address chronic illness & long-term health Disease Management Program Asthma Cancer Participation Results § Program results have shown a 13% reduction in ER visits; a 32% reduction in hospitalizations, and a 29% reduction in hospital days § Past program results have shown a 34% cost reduction per case § Compared Diabetes Coronary Artery Disease (CAD) to the Annals of Internal Medicine Study: 20. 1% more people have annual eye exam; 52% more people have annual foot exam § When compared to national benchmarks; beta blocker therapy is 35% higher and the ER visit rate is 50% lower § When Heart Failure compared to national benchmarks; drug adherence is 30% higher, ER visit rate is 89% lower, and hospital admission rate is 70% lower End-stage Renal Disease (ESRD) § 50% Rare/Less Common Diseases § 14% 44 44 below national benchmark in hospital bed days; 4% higher dialysis adequacy than average decrease in PMPM cost from year 1 to year 3; 12% decrease in inpatient admissions

Humana Pharmacy Solutions – Cost Containment 45 45

The Humana Approach Formulary Management Member Education and Clinical Programs Net Cost Management Approach Channel Management 46 46 Targeted Consultative Services

Right. Source. Rx Preferred home delivery § Also known as mandatory mail - Requires maintenance medications be filled at RSRx starting with the 3 rd fill § Two options Hard Edit • On third fill, claim is denied and member pays the full cost. • On third fill, claim is denied and member pays twice the copay amount. § Provides savings to the group through improved Brand Non-MAC generics, and $0 dispensing fees § We can provide an analysis of potential savings for groups that are interested - Savings of 4%-12% is common 47 47 Soft Edit

Health Savings Account Port Washington State Bank

Health Savings Account A tax-advantaged account for individuals with High Deductible Health Plans to help pay for current or future qualified medical expenses for you, your spouse, and your dependents.

Regular Contribution Eligibility Requirements – Covered by an HDHP – Not enrolled in Medicare – Not eligible to be claimed as a dependent on a federal income tax return

2013 Contribution Limits Self-Only Coverage $3, 250 $1, 000 catch-up contribution (Age 55+) • SDo. G Contribution $1, 500 Family Coverage $6, 450 $1, 000 catch-up contribution (Age 55+) • SDo. G Contribution $3, 000

Did you Know? • HSA contributions are tax-deductible, interest earned is taxfree and withdrawals are also tax-free when used to pay for qualified medical expenses. • HSA funds belong to you and your balance carries over from year to year. • Contributions can come from employee, accountholder or third party. • After the age of 65, you can use the funds for any nonqualifying expense and pay only income tax, and there are no IRS penalties.

PWSB Health Savings Account – Interest Paid Monthly – No Annual Fee Visa Check Card – Monthly Statement with Check – Free Internet Banking – Free 24 hr Telephone Banking – Free 1 st. Box of Checks Images

PWSB Health Savings Account – Agent may be Added • Check Signatory • Debit Card – Beneficiaries • Primary • Contingent

PWSB Health Savings Account Requirement A minimum balance of $200. 00 is required to avoid a $5. 00 monthly maintenance fee. PWSB will waive the minimum balance requirement for the first three months.

Current Tiered Rates • • $0 to $499 $500 to $4, 999 $5, 000 to $14, 999 $15, 000 & Over 0. 12%/0. 12%APY* 0. 32%/0. 32%APY* 0. 42%/0. 42%APY* 0. 52%/0. 52%APY* *Rates Effective as of 11/16/2012 *Rates may Change Weekly PWSB and Account Owner - Report Contributions/Distributions Annually to the IRS

How Do I Open my HSA? – Complete PWSB Health Savings Account Information Sheet – Return to District office by December 5 th in envelope marked confidential – After opening the HSA account, PWSB will contact you to schedule an appointment to sign finalized account paperwork during the week of December 10 th. Appointments can be arranged at a branch location or at designated times at your school

Port Washington State Bank Locations Belgium 545 Main Street 262 -284 -3491 Grafton 2080 Washington Street 262 -375 -0100 Cedarburg W 61 N 526 Washington Ave 262 -377 -0750 Port Washington 206 North Franklin Street 262 -284 -4416 Fredonia 201 Regal Drive 262 -692 -2444 Saukville 601 East Green Bay Road 262 -284 -4466

On behalf of all of us at PWSB, I want to extend my sincere appreciation for your time and interest in a Health Savings Account with PWSB. Contact: Angie Regnitz angie. regnitz@pwsb. com or 262 -375 -0100

Other Coverage Life, Disability and Dental

Other Coverage • Life Insurance – Madison National - New Carrier but same benefit - 1 X your salary to a maximum of $100, 000 • Long Term Disability Insurance – Madison National - New Carrier and New Benefit - 66 2/3% Income Replacement after 60 day elimination period - Definition of disability remains the same • Dental Insurance – Met Life - Same Carrier and Same Benefit

Health Care Reform Changes • Flexible Spending Accounts - No more over the counter drugs without a prescription - FSA is limited to $2, 500 (does not include dependent care) - Adding a limited purpose flex for those in the H S A plan • Women’s Preventive Care Enhancements, no cost share for - Screening for gestational diabetes in pregnant women - FDA approved contraceptives - Breastfeeding support, supplies and counseling - Domestic violence screening and counseling

What’s Next? • On track to have ID cards to members by January 1 st • Deductibles accumulate on a calendar year basis – they will reset and start over January 1 st • IF you intend to participate in the FSA benefit, you MUST enroll online by December 13 th • You will need to select your medical plan by December 5 th, if no election is made you will default to the Traditional Plan • You will automatically be enrolled at the same level of coverage that you have today unless you make your appropriate change • Your enrollment in the new Disability and Life coverage will happen automatically • Transition of Care paperwork (not a likely event)

What’s Next? • Your benefit election is an Annual Irrevocable Election unless there is a Qualifying Event, such as: n New Child – Adoption or Newborn n Change of Child Custody or Support Order n Marriage/Divorce n Spouse Loses/Quits their Job n Death of Spouse NOTE: Changes must be received within 31 days after the qualifying event If changes are received after 31 days, changes will not take place until next open enrollment

What’s Next? • Additional Voluntary Benefit opportunities will be offered in 2013 – Supplemental Life, Short Term Disability and Vision Insurance! • Wellness program will be launched in 2013 with a formal introduction to Humana Vitality!

Questions…