EX-10.4



 





Exhibit 10.4




SOLUTIA 2008 RETIREE WELFARE

PLAN 




Amended and Restated as of February 28, 2008




 









 








TABLE OF CONTENTS




	 	 	 	 	 
	SECTION 1 DEFINITIONS
	 	 	3	 
	1.1 Active Plan
	 	 	3	 
	1.2 Administrative Services Provider
	 	 	3	 
	1.3 Brand Name Drug
	 	 	4	 
	1.4 Code
	 	 	4	 
	1.5 Contracted Amount
	 	 	4	 
	1.6 Co-Payment Amount
	 	 	4	 
	1.7 Coverage Category
	 	 	4	 
	1.8 Covered Drug
	 	 	4	 
	1.9 Covered Group
	 	 	5	 
	1.10 Covered Proportion
	 	 	5	 
	1.11 Custodial Care
	 	 	5	 
	1.12 Deductible Amount
	 	 	6	 
	1.13 Dependent
	 	 	6	 
	1.14 Disabled
	 	 	7	 
	1.15 Employee
	 	 	7	 
	1.16 Employer
	 	 	8	 
	1.17 ERISA
	 	 	8	 
	1.18 Former Pharmacia Participant
	 	 	8	 
	1.19 Forsberg Settlement
	 	 	8	 
	1.20 Generic Drug
	 	 	8	 
	1.21 Group IA
	 	 	8	 
	1.22 Group IB
	 	 	8	 
	1.23 Group IIA
	 	 	8	 
	1.24 Group IIB
	 	 	9	 
	1.25 Group IIIA
	 	 	9	 
	1.26 Group IIIB
	 	 	9	 
	1.27 Group IV
	 	 	10	 
	1.28 Group V
	 	 	10	 
	1.29 Group VI
	 	 	10	 
	1.30 Home Health Care Agency
	 	 	11	 
	1.31 Home Health Care Plan
	 	 	11	 
	1.32 Hospice Care Facility
	 	 	11	 
	1.33 Hospice Care Program
	 	 	12	 
	1.34 Legend Drug
	 	 	12	 
	1.35 Maintenance Drug
	 	 	12	 
	1.36 Maximum Aggregate Benefit
	 	 	12	 
	1.37 Medical Expense Contributions
	 	 	12	 
	1.38 Medical Plan Choice
	 	 	12	 
	1.39 Medically Necessary
	 	 	13	 






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	1.40 Medicare
	 	 	13	 
	1.41 Medicare Eligible Participant
	 	 	14	 
	1.42 Monsanto Company
	 	 	14	 
	1.43 Nonparticipating Provider
	 	 	14	 
	1.44 Open Enrollment Period
	 	 	14	 
	1.45 Participant
	 	 	14	 
	1.46 Participating Provider
	 	 	14	 
	1.47 Pension Plan
	 	 	14	 
	1.48 Pharmacia Corporation
	 	 	14	 
	1.49 Pharmacy
	 	 	15	 
	1.50 Physician
	 	 	15	 
	1.51 Plan
	 	 	15	 
	1.52 Plan Year
	 	 	15	 
	1.53 Prescription Order
	 	 	15	 
	1.54 Prior Plan
	 	 	15	 
	1.55 Provider
	 	 	15	 
	1.56 Psychologist
	 	 	15	 
	1.57 Reasonable and Customary
	 	 	16	 
	1.58 Retired Employee
	 	 	16	 
	1.59 Retiree Liaison Committee
	 	 	20	 
	1.60 Service
	 	 	20	 
	1.61 Spell of Illness
	 	 	20	 
	1.62 Spouse
	 	 	20	 
	1.63 Subsidiary
	 	 	20	 
	1.64 Surviving Spouse
	 	 	20	 
	1.65 Terminated for Misconduct
	 	 	21	 
	 
	 	 	 	 
	SECTION 2 ELIGIBILITY AND EFFECTIVE DATES OF COVERAGE
	 	 	22	 
	2.1 Eligibility
	 	 	22	 
	2.2 Effective Date of Coverage for Retired Employees and Surviving Spouses
	 	 	22	 
	2.3 Effective Date of Coverage for Dependents
	 	 	22	 
	2.4 Initial Election by a Retired Employee
	 	 	23	 
	2.5 Election by Surviving Spouse
	 	 	23	 
	2.6 Election by Dependent Spouse
	 	 	23	 
	2.7 Change in Election
	 	 	24	 
	2.8 Cessation of Participation
	 	 	24	 
	2.9 Dependent Elections
	 	 	24	 
	 
	 	 	 	 
	SECTION 3 MEDICAL EXPENSE CONTRIBUTIONS
	 	 	25	 
	3.1 Medical Expense Contribution
	 	 	25	 
	3.2 Annual Cost
	 	 	25	 
	3.3 Defined Dollar Limit Amount
	 	 	27	 
	3.4 Medical Expense Contributions Equal to Cost
	 	 	28	 
	3.5 No Adjustments
	 	 	28	 
	3.6 Payments
	 	 	28	 
	3.7 Resolution Of Disputes Regarding Application of Methodology
	 	 	28	 






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	SECTION 4 SCHEDULE OF MEDICAL AND DRUG BENEFITS
	 	 	30	 
	4.1 Schedule of Benefits for Participants Who Are Not Medicare Eligible
	 	 	30	 
	4.2 Schedule of Benefits for Medicare Eligible Participants
	 	 	30	 
	4.3 Benefits for Mental Health or Substance Abuse
	 	 	31	 
	4.4 Sterilization Reversal Benefits
	 	 	32	 
	4.5 Maximum Aggregate Benefit
	 	 	32	 
	4.6 Requirements of Minimum Hospital Stays Following Childbirth
	 	 	33	 
	 
	 	 	 	 
	SECTION 5 MEDICAL AND DRUG BENEFITS
	 	 	34	 
	5.1 Benefit Provisions for Participants Who Are Not Medicare Eligible
	 	 	34	 
	5.2 Benefit Provisions for Medicare Eligible Participants
	 	 	34	 
	 
	 	 	 	 
	SECTION 6 COVERED MEDICAL AND DRUG EXPENSES AND EXCLUSIONS
	 	 	36	 
	6.1 Covered Medical Expenses
	 	 	36	 
	6.2 Exclusions
	 	 	37	 
	6.3 Covered Drug Expenses
	 	 	38	 
	6.4 Exclusions
	 	 	39	 
	6.5 Mail Order Prescription Drug Program
	 	 	41	 
	6.6 Coordination with Medicare Part D
	 	 	41	 
	 
	 	 	 	 
	SECTION 7 PRE-ADMISSION CERTIFICATION AND CONCURRENT REVIEW
	 	 	42	 
	 
	 	 	 	 
	SECTION 8 HOSPICE CARE BENEFITS
	 	 	43	 
	8.1 Hospice Care Benefits
	 	 	43	 
	8.2 Services Or Supplies Which Are Covered Hospice Care Benefits
	 	 	43	 
	8.3 Exclusions
	 	 	44	 
	 
	 	 	 	 
	SECTION 9 HOME HEALTH CARE BENEFITS
	 	 	46	 
	9.1 Home Health Care Benefits
	 	 	46	 
	9.2 Expenses Which Are Covered Home Health Care Benefits
	 	 	46	 
	9.3 Exclusions
	 	 	46	 
	 
	 	 	 	 
	SECTION 10 MEDICAL CASE MANAGEMENT PROGRAM
	 	 	48	 
	10.1 Definitions
	 	 	48	 
	10.2 Medical Case Management Program
	 	 	50	 
	10.3 Payment of Alternate Medical Treatment Benefits
	 	 	52	 
	10.4 Amount of Alternate Medical Treatment Benefits
	 	 	52	 
	10.5 Maximum Benefit
	 	 	52	 
	10.6 Covered Alternate Medical Treatment Expenses
	 	 	53	 
	 
	 	 	 	 
	SECTION 11 CLAIMS
	 	 	54	 
	11.1 Filing and Payment of Medical Claims
	 	 	54	 
	11.2 Payment of Prescription Drug Claims
	 	 	54	 
	11.3 Overpayment or Other Reimbursement
	 	 	55	 
	11.4 Additional Procedures
	 	 	55	 
	11.5 Claims and Review Procedures
	 	 	55	 






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	SECTION 12 PROVISIONS APPLICABLE AT THE DEATH OF A RETIRED EMPLOYEE
	 	 	64	 
	 
	 	 	 	 
	SECTION 13 CESSATION OF COVERAGE
	 	 	65	 
	13.1 Termination of Coverage
	 	 	65	 
	13.2 Loss of Dependent Status
	 	 	65	 
	13.3 Failure to Make Required Payments
	 	 	65	 
	13.4 Maximum Aggregate Benefit
	 	 	66	 
	13.5 Cancellation of Coverage
	 	 	66	 
	13.6 Benefits After Cessation of Coverage
	 	 	66	 
	 
	 	 	 	 
	SECTION 14 COBRA CONTINUATION COVERAGE
	 	 	68	 
	 
	 	 	 	 
	SECTION 15 COORDINATION OF BENEFITS
	 	 	69	 
	15.1 Definitions
	 	 	69	 
	15.2 Coordination of Benefits
	 	 	70	 
	15.3 Order of Benefit Determination
	 	 	71	 
	15.4 Right to Receive and Release Necessary Information
	 	 	74	 
	15.5 Underpayments and Overpayments
	 	 	74	 
	15.6 Subrogation
	 	 	74	 
	 
	 	 	 	 
	SECTION 16 AMENDMENT AND TERMINATION
	 	 	78	 
	16.1 Limit on Right to Amend
	 	 	78	 
	16.2 Permitted Amendments
	 	 	79	 
	16.3 Resolution of Disputes With Retiree Liaison Committee
	 	 	80	 
	16.4 Right to Amend or Terminate the Plan
	 	 	80	 
	16.5 No Informal Amendments
	 	 	81	 
	16.6 Active Plan Amendments
	 	 	81	 
	 
	 	 	 	 
	SECTION 17 PLAN ADMINISTRATOR
	 	 	82	 
	17.1 Administrator
	 	 	82	 
	17.2 Duties and Powers
	 	 	82	 
	17.3 Standard of Review
	 	 	83	 
	17.4 Limitation of Liability
	 	 	83	 
	17.5 Information Required by Administrative Services Provider
	 	 	84	 
	 
	 	 	 	 
	SECTION 18 HEALTH MAINTENANCE ORGANIZATIONS
	 	 	85	 
	 
	 	 	 	 
	SECTION 19 MISCELLANEOUS
	 	 	86	 
	19.1 Gender and Number
	 	 	86	 
	19.2 Headings
	 	 	86	 
	19.3 Governing Law
	 	 	86	 
	19.4 Conflicts
	 	 	86	 
	19.5 Waiver
	 	 	87	 
	19.6 Service of Legal Process
	 	 	87	 
	19.7 Supplements
	 	 	87	 
	19.8 Qualified Medical Child Support Orders
	 	 	87	 






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	19.9 VEBA and Other Trusts
	 	 	87	 
	 
	 	 	 	 
	SECTION 20 HIPAA PRIVACY
	 	 	88	 
	20.1 HIPAA Privacy
	 	 	88	 
	20.2 PHI Nondisclosure
	 	 	90	 
	20.3 Permitted Disclosures
	 	 	90	 
	20.4 Disclosure Requirements
	 	 	91	 
	20.5 Adequate Separation
	 	 	92	 
	 
	 	 	 	 
	APPENDIX A LIFE INSURANCE CERTIFICATE
	 	 	92	 







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SOLUTIA 2008 RETIREE WELFARE PLAN



Solutia Inc. (herein called the “Company”) hereby, amends and restates the Solutia Inc.
Medical Benefits Plan for Retirees (2002) (the “2002 Plan”), the Solutia Inc. Medical Benefits Plan
for Retirees (Post-Settlement) (the “Post-Settlement Plan”), and the Solutia Inc. Retiree Life
Insurance Plan, and consolidates them into this 2008 Retiree Welfare Plan (the “Plan”),
effective as of February 28, 2008 (except as otherwise stated herein). The 2002 Plan, originally
effective as of January 1, 2002, was first applicable as of such date to specified Retired
Employees who retired prior to January 1, 2002, and who were members of the classes certified by
the court in Solutia Inc. v. George Forsberg, et al., Case No. 3:98 CV237/RV/SMN and to specified
Retired Employees who retired after January 1, 2002 and through December 31, 2002 who were
participants in a collective bargaining agreement ending December 31, 2002. The Post-Settlement
Plan, originally effective as of January 1, 2002, was first applicable as of such date to specified
Retired Employees who retired after October 19, 2001, and who were not members of the classes
certified by the court in Solutia Inc. v. George Forsberg, et al., Case No. 3:98 CV237/RV/SMN.



This Plan was created in connection with a settlement (the “Retiree Settlement”) between (a) the
Company, (b) those Retired Employees, including their Surviving Spouses and Dependents, who worked
for Pharmacia Corporation (f/k/a Monsanto and referred to as Pharmacia or Pharmacia Corporation
herein), and retired, prior to the Company’s spin-off from Pharmacia in 1997, (c) those Retired
Employees, including their Surviving Spouses and Dependents, who retired from the Company after the
Company’s spin-off from Pharmacia in 1997 (including those Retired Employees and their Surviving
Spouses and Dependents who worked for Pharmacia prior to Company’s spin-off from Pharmacia in 1997
and thereafter for the Company), (d) any other person having a claim against the Company for
“retiree benefits” as such term is defined in section 1114(a) of the Bankruptcy Code and (e) the
official committee of retirees appointed on February 20, 2004, in the Company’s chapter 11 cases
currently pending before the United States Bankruptcy Court for the Southern District of New York
(the “Retirees’ Committee”).



This Plan makes the following changes to the Post-Settlement Plan, effective as of September 1,
2004: (i) it raises the eligibility thresholds certain Employees must meet in order to become


 









 






eligible for benefits under the Plan, (ii) it “grandfathers” the eligibility of certain Employees
who attain age 55 with at least 10 years of Service prior to January 1, 2007, and (iii) it
grandfathers the eligibility of certain Employees whose sum of age and years of Service is equal to
or greater than 75 prior to January 1, 2007. Any Employee who is not covered by a collective
bargaining agreement and who is hired on or after January 1, 1999 shall be ineligible to
participate in the Plan. In addition, this consolidation, amendment and restatement provides that
the benefits of certain eligible individuals end no later than the earlier of (i) Medicare
eligibility (age 65), or (ii) October 31, 2016. Also, effective January 1, 2005, the Company
amended its Separation Pay Plan to provide that an employee who attains age 53 as of January 1,
2005 with 10 years of service at his separation date and who is involuntarily separated from
service would be eligible to participate in the Plan immediately following his or her Separation
Date. In addition, an employee who attains age 50 and whose sum of age plus years of Service as of
his Separation Date equals or exceeds 75 (“Combo 75”) would be eligible to participate in the Plan
upon attaining age 55.



This Plan also implements certain legally required changes as well as various clarifications to the
benefits provided under the 2002 Plan and the Post-Settlement Plan. This Plan is not a contract of
insurance. The terms of the retiree life insurance benefits will be governed by the applicable
insurance policy, and will provide benefits to Retired Employees who were covered under the
Solutia, Inc. Retiree Life Insurance Plan on the day before the effective date of this Plan,
consistent with the following:





	 	a)	 	for each Retired Employee covered under the Solutia, Inc. Retiree Life Insurance Plan
on the day before the effective date of this Plan who retired prior to January 1, 1986,
such Retired Employee’s life insurance coverage amount in effect on the day immediately
preceding the effective date of this Plan, up to a maximum coverage limit of $12,500;
	 
	 	b)	 	for each Retired Employee covered under the Solutia, Inc. Retiree Life Insurance Plan
on the day before the effective date of this Plan who retired from January 1, 1986 through
December 31, 2001, such Retired Employee’s life insurance coverage amount in effect on
the day immediately preceding the effective date of this Plan, up to a maximum coverage
limit of $10,000; and




- 2 -









 






	 	c)	 	for each Retired Employee covered under the Solutia, Inc. Retiree Life Insurance Plan
on the day before the effective date of this Plan who retired after December 31, 2001, such
Retired Employee will receive no life insurance benefits under this Plan.




These life insurance benefits shall not be subject to change and shall continue even in the event
that any Retired Employee is not covered for medical and drug benefits under this Plan or any
subsequent retiree medical benefit plan.



Appendix A sets forth the certificate of insurance covering retiree life insurance benefits. The
Company will distribute to covered Retired Employees a new life insurance certificate describing
the life insurance benefits and will notify affected Retired Employees in the event of any change
in insurance carriers.




SECTION 1

DEFINITIONS





	1.1	 	Active Plan. “Active Plan” means the Solutia Inc. Medical Benefits Plan effective September
1, 1997 and its successors, as such plan or any successors may be amended or restated from
time to time.
	 
	1.2	 	Administrative Services Provider. “Administrative Services Provider” means an insurance
company or other entity with which the Company has contracted for the provision of
administrative services necessary or desirable under the Plan, or the duly authorized designee
of such insurance company or other entity. If the Company has contracted with more than one
insurance company or entity, the term Administrative Services Provider shall refer to the
entities or entity with which the Company has contracted for the provision of the particular
service at issue. If the Company has not contracted with an Administrative Services Provider
for the provision of a particular service, all references to Administrative Services Provider
with respect to that service shall be deemed to be references to the Plan Administrator or the
person or group
designated by the Plan Administrator to carry out the tasks of the Administrative Services
Provider with respect to that service.




- 3 -









 






	1.3	 	Brand Name Drug. “Brand Name Drug” means a Legend Drug that is available from a single
manufacturer and that is labeled as such in the National Drug Data File (NDDF) or other
nationally recognized reporting service.
	 
	1.4	 	Code. “Code” means the Internal Revenue Code of 1986, as amended.
	 
	1.5	 	Contracted Amount. “Contracted Amount” means the amount that is the discounted fee
negotiated by the prescription drug Administrative Services Provider who administers the
prescription drug program under the Plan.
	 
	1.6	 	Co-Payment Amount. “Co-Payment Amount” means, with respect to Covered Drugs purchased at
participating retail pharmacies, 20% of the Contracted Amount of the Covered Drug, not to
exceed $50. “Co-Payment Amount” means, with respect to Covered Drugs purchased at the mail
order pharmacy, 20% of the Contracted Amount of the Covered Drug. Syringes, needles and
insulin Prescription Orders filled on the same day shall require the payment of only one
Co-Payment Amount with respect to those Prescription Orders by the covered Participant or
covered Dependent. “Co-Payment Amount” means, with respect to Covered Medical Expenses, the
portion of the Contracted Amount payable by a Participant and specified in this Plan or the
Active Plan for such Covered Medical Expenses.
	 
	1.7	 	Coverage Category. “Coverage Category” shall mean the category of medical and drug coverage
under this Plan elected by the Retired Employee or Dependent Spouse or Surviving Spouse and
shall be limited to one of the following: (a) coverage for the Retired Employee, Dependent
Spouse (for Groups IIB, V and VI) or Surviving Spouse alone; (b) coverage for the Retired
Employee and Spouse; (c) coverage for the Retired Employee or Dependent Spouse (for Groups
IIB, V and VI) or Surviving Spouse and child(ren) who qualify as Dependents; or (d) coverage
for the Retired Employee, Spouse and child(ren) who qualify as Dependents.
	 
	1.8	 	Covered Drug. “Covered Drug,” except as herein otherwise limited or excluded, means any of
the following drugs and medicines, or any refill thereof, unless such drugs or medicines were
acquired without cost to the Participant:






	 	(a)	 	a Legend Drug,
	 
	 	(b)	 	insulin,




- 4 -









 






	 	(c)	 	a compounded Prescription Order in which at least one ingredient is a Legend
Drug,
	 
	 	(d)	 	oral contraceptives,
	 
	 	(e)	 	any other drugs or medicines which, under the applicable state law, may be
dispensed only upon a Prescription Order,
	 
	 	(f)	 	disposable needles and syringes when prescribed with insulin, allergy serum, or
other injectable drugs, and
	 
	 	(g)	 	diabetic testing agents, including, but not limited to, tablets, strips and
tape.






	 	 	A “Covered Drug” must be Medically Necessary and the cost thereof must not be included or
includable in the cost of other services or supplies provided to or prescribed for the
covered Participant or covered Dependent.
	 
	1.9	 	Covered Group. “Covered Group” shall mean the Retired Employee and the Dependents he or she
has elected to cover for medical and drug benefits under the Plan, or the Dependent Spouse
(for Groups IIB, V and VI) or Surviving Spouse of a Retired Employee and the Dependents he or
she has elected to cover under the Plan.
	 
	1.10	 	Covered Proportion. “Covered Proportion” means the portion of a Covered Medical Expense
which the Employer is obligated to pay pursuant to the terms hereof.
	 
	1.11	 	Custodial Care. “Custodial Care” shall mean that type of care (including room and board
needed to provide that care) which:






	 	(a)	 	is given mainly to help a person with personal hygiene or to perform the
activities of daily living; and
	 
	 	(b)	 	can, in the terms of generally accepted medical standards, be safely and
adequately given by people who are not trained or licensed medical or nursing
personnel.






	 	 	Services are Custodial Care regardless of who recommends, provides or directs the care or
where the care is given.




- 5 -









 






	1.12	 	Deductible Amount. “Deductible Amount” means with respect to any Plan Year the amount, as
shown in the Schedules of Benefits set forth in Section 4, of Covered Medical Expenses which a
Participant is obligated to pay before benefits are payable under the Plan.
	 
	 	 	If a Participant incurs Covered Medical Expenses on his or her own account and on account of
one or more of his or her covered Dependents, or on account of two or more of his or her
covered Dependents, due to injuries sustained in the same accident, the Deductible Amount
shall be limited to the amount specified in the applicable Schedule of Benefits set forth in
Section 4 with respect to all Covered Medical Expenses incurred on account of such accident
for all such persons and which are incurred prior to the end of the calendar year in which
the accident occurred.
	 
	1.13	 	Dependent. “Dependent” means (a) a Retired Employee’s Spouse, (b) any unmarried child under
twenty-five years of age of a Retired Employee, excluding in any case, (i) any person who is
eligible for coverage as an Employee, (ii) any person who was not eligible for coverage as a
Dependent under a medical plan maintained by Pharmacia Corporation or the Company for active
employees on the day preceding the date such Retired Employee retired, (iii) any child
nineteen years of age or over who is not a full-time student, (iv) any child who is employed
on a full-time basis and who is not principally dependent upon the Retired Employee for
maintenance and support, and (v) any child who is in the military or similar forces of any
country or subdivision thereof. The term “child” includes any natural child, any child
legally placed for adoption, any stepchild who permanently resides in the Retired Employee’s
household and any child under the court-appointed legal guardianship of the Retired Employee
or the Retired Employee’s
Spouse and who resides in the Retired Employee’s household. The term “child” also includes
any other child who, prior to August 31, 1997, was on the Administrative Services Provider’s
approved list of “grandfathered” children under a Prior Plan.
	 
	 	 	A child who is covered as a Dependent on the day immediately preceding the date he or she
otherwise would have ceased to be a Dependent and who is then totally and





- 6 -









 





	 	 	permanently
disabled and fully dependent on the Retired Employee for maintenance and support shall not
be excluded as a covered Dependent; provided due proof is submitted to the
Administrative Services Provider of such total and permanent disability thirty-one days
before the date the child would otherwise cease to be a Dependent and proof of continuance
of such disability is made when requested. For purposes of the foregoing sentence, a person
is totally and permanently disabled if (a) the person is totally disabled by reason of
bodily injury or disease or birth defect so as to be prevented thereby from engaging in any
occupation or employment for remuneration for which the person is or can be equipped by
reason of training, education or ability, and (b) the condition of total disability is
expected to be permanent during the remainder of the person’s life.
	 
	1.14	 	Disabled. “Disabled” means Totally and Permanently Disabled or Disabled For Any Occupation
under the terms of the applicable disability income plan maintained by an Employer that covers
the Employee.
	 
	1.15	 	Employee. “Employee” means any individual who is classified by an Employer as a regular
full-time or regular part-time, active, common law employee and who immediately prior to
becoming a Retired Employee was eligible to participate in the Active Plan or any other
medical plan maintained by Pharmacia or the Company for active employees. Notwithstanding
anything to the contrary, “Employee” shall not include:






	 	(a)	 	any leased employee within the meaning of Code Section 414(n);
	 
	 	(b)	 	any individual employed as a temporary, cooperative, summer or seasonal, or per
diem employee;
	 
	 	(c)	 	any individual who resides in Hawaii;
	 
	 	(d)	 	any individual who is on international assignment from a foreign operation of
an Employer or a Subsidiary to the domestic operations of an Employer;
	 
	 	(e)	 	any individual who is treated by an Employer as an independent contractor or a
leased employee, regardless of whether such individual is later declared a common law
employee by a court or government agency.




- 7 -









 












	1.16	 	Employer. “Employer” means the Company and each employer or Subsidiary which has adopted the
Plan with the approval of the Company.
	 
	1.17	 	ERISA. “ERISA” means the Employee Retirement Income Security Act of 1974, as amended.
	 
	1.18	 	Former Pharmacia Participant. “Former Pharmacia Participant” shall mean an individual for
whom the responsibility to provide retiree medical benefits under a Prior Plan was transferred
to the Company in connection with the distribution by Pharmacia Corporation (f/k/a Monsanto
Company) of all of the outstanding shares of the Company effective September 1, 1997, provided
that the term “Former Pharmacia Participant” shall not include an individual for whom the
responsibility to provide retiree medical benefits was transferred to Monsanto Company in
connection with the transfer to Monsanto Company of the Company’s interest in the P4 joint
venture.
	 
	1.19	 	Forsberg Settlement. “Forsberg Settlement” means the Order and Final Judgment dated November
1, 2001, filed in the United States District Court for the Northern District of Florida,
Pensacola Division, approving the settlement agreement and 2002 Plan in settlement of the
litigation related to medical benefits for Retired Employees in Solutia Inc. v. George
Forsberg, et al., Case No. 3:98 CV237/RV/SMN, and related documents.
	 
	1.20	 	Generic Drug. “Generic Drug” means a Legend Drug that is labeled as such in the NDDF or
other then current nationally recognized reporting service.
	 
	1.21	 	Group IA. “Group IA” means the group composed of (a) Former Pharmacia Participant members
of a class certified in the Forsberg Settlement who were covered by a collective bargaining
agreement between Pharmacia Corporation and a union and who retired under a Prior Plan that
became effective prior to January 1, 1981; and (b) Surviving Spouses and covered Dependents of
such class members.
	 
	1.22	 	Group IB. “Group IB” means the group composed of (a) Former Pharmacia Participant members of
a class certified in the Forsberg Settlement who were covered by a collective bargaining
agreement between Pharmacia Corporation and a union and who retired under a Prior Plan that
became effective on January 1, 1981; and (b) Surviving Spouses and covered Dependents of such
class members.
	 
	1.23	 	Group IIA. “Group IIA” means the group composed of (a) Former Pharmacia Participant members
of a class certified in the Forsberg Settlement who were covered by a collective




- 8 -









 






	 	 	bargaining
agreement between Pharmacia Corporation and a union and who retired under a Prior Plan that
became effective on or after January 1, 1986 and before December 1, 1994, and (b) Surviving
Spouses and covered Dependents of such class members.
	 
	1.24	 	Group IIB. “Group IIB” means the group composed of members of a class certified in the
Forsberg Settlement of (a) Former Pharmacia Participants who were covered by a collective
bargaining agreement between Pharmacia Corporation and a union and who retired under a Prior
Plan that became effective on or after December 1, 1994; (b) persons hired prior to February
1, 2002 who retired from the Company prior to January 1, 2003 and who at the time of their
retirement were covered by a collective bargaining agreement between the Company and a union;
(c) persons who were transferred to Flexsys America LP(“Flexsys”)at the time of the formation
of Flexsys (April 30, 1995) and who were covered under a collective bargaining agreement
between Pharmacia Corporation and a union and who had attained age 50 at the time of transfer
from Pharmacia Corporation to Flexsys and who had attained age 50 and five years of Service
prior to separating from service with Flexsys and who separated from service with Flexsys
prior to enrolling for coverage under the Plan (years of service are not required for retiree
life insurance coverage only); (d) persons who were transferred to Astaris LLC at the time of
the formation of Astaris LLC (April 1, 2000) and who were members of a collective bargaining
unit recognized by the Company and who had attained age 45 at the time of transfer from the
Company to Astaris LLC and who attained age 55 and ten years of Service while employed with
Astaris LLC; and (e) Surviving Spouses and covered Dependents of class members described in
(a),(b), (c) or (d).
	 
	1.25	 	Group IIIA. “Group IIIA” means the group composed of (a) Former Pharmacia Participant
members of a class certified in the Forsberg Settlement who were not covered by a collective
bargaining agreement between Pharmacia Corporation and a union and who retired under a Prior
Plan that became effective prior to January 1, 1981, and (b) Surviving Spouses and covered
Dependents of such class members.
	 
	1.26	 	Group IIIB. “Group IIIB” means the group composed of (a) Former Pharmacia Participant
members of a class certified in the Forsberg Settlement who were not covered by a collective
bargaining agreement between Pharmacia Corporation and a union and




- 9 -









 






	 	 	who retired under a Prior
Plan that became effective on January 1, 1981; and (b) Surviving Spouses and covered
Dependents of such class members.
	 
	1.27	 	Group IV. “Group IV” means the group composed of (a) Former Pharmacia Participant members of
a class certified in the Forsberg Settlement who were not covered by a collective bargaining
agreement and who (i) retired under a Prior Plan that became effective on or after
January 1, 1986 and before December 1, 1990 or (ii) retired prior to June 25, 1992 under a
Prior Plan that became effective January 1, 1991; and (b) Surviving Spouses and covered
Dependents of such class members.
	 
	1.28	 	Group V. “Group V” means the group composed of (a) members of a class certified in the
Forsberg Settlement who were not covered by a collective bargaining agreement and who retired
on or after June 25, 1992 under a Prior Plan that became effective on or after
December 1, 1990; (b) members of a class certified in the Forsberg Settlement who were not
covered by a collective bargaining agreement and who retired on or after June 25, 1992 under a
Prior Plan that became effective on or after December 1, 1990 and who were transferred to
Flexsys at the time of the formation of Flexsys (April 30, 1995) and who had attained age 50
at the time of transfer from Pharmacia Corporation to Flexsys and who had attained age 50 and
five years of Service prior to separating from service with Flexsys and who separated from
service with Flexsys LLC prior to enrolling for coverage under the Plan; and (c) members of a
class certified in the Forsberg Settlement who were not covered by a collective bargaining
agreement and who retired on or after June 25, 1992 under a Prior Plan that became effective
on or after December 1, 1990 and who were transferred to Astaris LLC at the time of the
formation of Astaris LLC (April 1, 2000) and who were at least 45 years of age at the time of transfer and who had attained age
55 and ten years of Service while employed with Astaris LLC; and (d)  Surviving Spouses and
covered Dependents of such persons described in (a), (b) and (c).
	 
	1.29	 	Group VI. “Group VI” means the group composed of persons who were not covered by a
collective bargaining agreement and (a) who retired from the Company on or after January 1,
2002; (b) who retired on or after January 1, 2002 and who were transferred to Flexsys at the
time of the formation of Flexsys (April 30, 1995) and who had attained age 50 at the time of
transfer from Pharmacia Corporation to Flexsys and who had attained age 50 and five years of
Service prior to separating from service with Flexsys




- 10 -









 






	 	 	and who separated from service with
Flexsys prior to enrolling for coverage under the Plan; (c) who retired on or after January 1,
2002 and who were transferred to Astaris LLC at the time of the formation of Astaris LLC
(April 1, 2000) and who were at least 45 years of age at the time of transfer and who had
attained age 55 and ten years of Service while employed with Astaris LLC; and (d) Surviving
Spouses and covered Dependents of such Retired Employees described in (a), (b) and (c).
	 
	1.30	 	Home Health Care Agency. “Home Health Care Agency” means a hospital or other organization
approved by the Administrative Services Provider:






	 	(a)	 	which is licensed or certified under a public health law or a similar law to
provide home health care services; or
	 
	 	(b)	 	which is recognized as a home health care agency by Medicare.






	1.31	 	Home Health Care Plan. “Home Health Care Plan” means a program prescribed by a Physician,
approved in advance in writing by the Administrative Services Provider, and periodically
reviewed by a Physician, together with such Physician’s certification that the medical
condition of the Participant or covered Dependent and the proper treatment of the specific
condition would require confinement in a hospital or skilled nursing facility in the absence
of the services and supplies provided as part of the Home Health Care Plan. The Home Health
Care Plan shall further certify that the Participant or covered Dependent requires, on an
intermittent basis, skilled nursing or skilled physical, occupational, or speech therapy.
	 
	1.32	 	Hospice Care Facility. “Hospice Care Facility” means a facility approved by the
Administrative Services Provider which is:






	 	(a)	 	a free-standing facility fully staffed and equipped to provide for the needs of
the terminally ill, or
	 
	 	(b)	 	a program organized for the purpose of providing referral service for patients
and/or relatives of the patient in a home setting, or




- 11 -









 






	 	(c)	 	an in-hospital facility which is part of a licensed hospital but designated by
the hospital as a Hospice Unit or is an adjacent facility, administered by the hospital
and designated as a Hospice Unit.






	1.33	 	Hospice Care Program. “Hospice Care Program” means a plan for hospice care which is a
centrally coordinated program of Medically Necessary home health, outpatient and/or inpatient
services provided by an interdisciplinary team and directed by a Physician.
Such program must be:






	 	(a)	 	prescribed by the attending Physician and approved in advance by the
Administrative Services Provider, and
	 
	 	(b)	 	based on a statement by the Physician documenting the patient’s diagnosis and
indicating the life expectancy of the patient is six months or less, and
	 
	 	(c)	 	treatment which consists of palliative care only.






	1.34	 	Legend Drug. “Legend Drug” means a prescription drug (any medical substance, the label of
which under the Federal Food, Drug and Cosmetic Act, is required to bear the legend:
“Caution: Federal Law prohibits dispensing without prescription”).
	 
	1.35	 	Maintenance Drug. “Maintenance Drug” means a Legend Drug that is prescribed for an ongoing
period of time.
	 
	1.36	 	Maximum Aggregate Benefit. “Maximum Aggregate Benefit” means the maximum amount the Company
shall be obligated to pay with respect to Covered Medical Expenses and Covered Drugs incurred
on account of an individual under this Plan or a Prior Plan,
including any payments made from a voluntary employees’ beneficiary association (“VEBA”) or
other trust, if applicable.
	 
	1.37	 	Medical Expense Contributions. “Medical Expense Contributions” shall mean with respect to a
Retired Employee, Dependent Spouse (for Groups IIB, V and VI) and a Surviving Spouse the
contributions which shall be required for coverage as set forth in Section 3.
	 
	1.38	 	Medical Plan Choice. “Medical Plan Choice” means a Medical Plan Choice made available to
participants under the Active Plan.




- 12 -









 






	1.39	 	Medically Necessary. A “Medically Necessary” service or supply is one prescribed by a
Physician for the diagnosis or treatment of a sickness or injury and is generally accepted,
and in use by, the medical community in the United States as appropriate and effective for the
condition being treated or diagnosed. Whether a service or supply is Medically Necessary will
be determined based on, and consistent with, standards established by the Administrative
Services Provider. Such standards shall be developed by the Administrative Services Provider,
in part, with consideration as to whether the service or supply meets all of the following
criteria:






	 	(a)	 	it is medically appropriate and necessary to meet the basic health needs of the
patient;
	 
	 	(b)	 	it is rendered in the most cost-efficient manner and type of setting
appropriate for the delivery of the health service;
	 
	 	(c)	 	it is consistent in type, frequency and duration of treatment with
scientifically based guidelines of national medical, research or health care coverage
organizations or governmental agencies;
	 
	 	(d)	 	it is consistent with the diagnosed condition;
	 
	 	(e)	 	it is required by the Physician for reasons other than the comfort or
convenience of the patient; and
	 
	 	(f)	 	it is of demonstrated medical value.






	 	 	A procedure or treatment shall not be Medically Necessary solely because (i) a Physician has
performed or prescribed it, or (ii) it is the only treatment for a particular injury or
illness. A determination by the Administrative Services Provider that a service or supply
is not Medically Necessary may apply to the entire service or supply, or any portion of it.
	 
	1.40	 	Medicare. “Medicare” shall mean the Health Insurance for the Aged Act of the United States,
Title XVIII of the Social Security Act, or any successor statute, as amended from time to
time.




- 13 -









 






	1.41	 	Medicare Eligible Participant. “Medicare Eligible Participant” shall mean any Retired
Employee, Dependent Spouse, or Surviving Spouse who is eligible for benefits under Medicare,
but excluding any such individual who is eligible for benefits under Medicare solely as a
result of disability.
	 
	1.42	 	Monsanto Company. “Monsanto Company” shall mean the company that was created on February 9,
2000, under the name “Monsanto Ag”, as a wholly-owned subsidiary of Pharmacia Corporation, and
changed its name to Monsanto Company on March 31, 2000.
	 
	1.43	 	Nonparticipating Provider. “Nonparticipating Provider” means a Provider who has not entered
into an agreement with the prescription drug Administrative Services Provider to provide
Covered Drugs.
	 
	1.44	 	Open Enrollment Period. “Open Enrollment Period” shall mean the Open Enrollment Period
established by the Plan Administrator.
	 
	1.45	 	Participant. “Participant” shall mean for any Plan Year, a Retired Employee or a Dependent
Spouse (for Groups IIB, V and VI) or Surviving Spouse who has elected to be covered under the
Plan and who has paid the required Medical Expense Contribution in the time and manner
specified in the Plan. The term Participant shall also include any Retired Employee who
remains covered by the life insurance benefits provided under the Plan, regardless of whether
such Retired Employee has elected to be covered under the Plan’s medical and drug benefits.
	 
	1.46	 	Participating Provider. “Participating Provider” means a Provider who has entered into an
agreement with the prescription drug Administrative Services Provider to provide Covered Drugs
and to be reimbursed therefore pursuant to the terms of such agreement.
	 
	1.47	 	Pension Plan. “Pension Plan” shall mean the Solutia Inc. Employees’ Pension Plan and any
successors thereto.
	 
	1.48	 	Pharmacia Corporation. “Pharmacia Corporation” shall mean the Delaware corporation formerly
known as Monsanto Company which effective September 1, 1997 distributed all of the outstanding shares of the Company as a dividend to its stockholders, which subsequently changed its name
to Pharmacia Corporation and which subsequently was acquired by and merged into Pfizer Inc.




- 14 -









 






	1.49	 	Pharmacy. “Pharmacy” means a licensed establishment where prescription drugs are dispensed
by a pharmacist licensed under the laws of the state wherein the pharmacist practices.
	 
	1.50	 	Physician. “Physician” means any doctor of medicine or doctor of osteopathy who is legally
qualified and licensed to practice medicine or surgery or osteopathic medicine or surgery at
the time and place services are rendered.
	 
	1.51	 	Plan. “Plan” shall mean this 2008 Retiree Welfare Plan, as amended from time to time to the
extent permitted under Section 16.
	 
	1.52	 	Plan Year. “Plan Year” shall mean the calendar year.
	 
	1.53	 	Prescription Order. “Prescription Order” means a prescriber’s lawful written, electronic, or
verbal order for a Legend Drug.
	 
	1.54	 	Prior Plan. “Prior Plan” shall mean any plan maintained by the Company or the Pharmacia
Corporation or any Employer on or before February 28, 2008 which provided medical benefits to
retirees of any Employer.
	 
	1.55	 	Provider. “Provider” means any duly licensed Pharmacy, Physician, or any other person or
organization legally licensed to dispense drugs.
	 
	1.56	 	Psychologist. “Psychologist” means any person who meets one of the following qualifications:






	 	(a)	 	If practicing in a state where statutory licensure or certification of
psychologists exists, the person holds a valid credential (as legally specified) for
such practice,
	 
	 	(b)	 	If practicing in a state where statutory licensure or certification of
psychologists does not exist, but where valid non-statutory (professional)
certification is
established by the jurisdiction’s recognized psychologist association, the person
holds such certification,
	 
	 	(c)	 	If practicing in a state where neither statutory nor non-statutory licensure
exists, the person holds a statement of qualification by a committee established for
the purpose by the jurisdiction’s recognized psychological association or, in the
absence of such a committee, the person holds a diploma in the appropriate specialty
awarded by the American Board of Examiners in Professional Psychology.




- 15 -









 












	1.57	 	Reasonable and Customary. A charge or expense is “Reasonable and Customary” if the
Administrative Services Provider determines that the charge or expense is no greater than the
lowest of: (a) the usual charge by the health care provider for the same or similar item or
service, (b) the usual charge of most other health care providers with similar training and
experience in the same geographic area for the same or a similar item, or (c) the actual
charge for the item.
	 
	1.58	 	Retired Employee. “Retired Employee” means an individual who:






	 	(a)	 	is a member of Groups IA, IB, IIA, IIB, IIIA, IIIB, IV, or V, and who;






	 	(i)	 	retired from employment with an Employer and who at the time of
retirement has attained at least age 55 years of age and had accrued at least
10 years of Service while eligible to participate in the Active Plan or a Prior
Plan and who was eligible to participate in the Active Plan or a Prior Plan on
the day before retirement;
	 
	 	(ii)	 	at the time of retirement had attained at least 50 years of
age, who had accrued at least 10 years of Service, whose age and years of
Service equal or exceed 65, who elected to retire under the 1997/98 Special
Program, the 1998 Special Program or the 1999 Special Program and who was
eligible to participate in the Active Plan or a Prior Plan on the day before
retirement;
	 
	 	(iii)	 	at the time of retirement had attained at least 50 years of
age, who had accrued at least 10 years of Service and who is eligible to
participate in this Plan under the applicable terms of the Solutia Inc.
Separation Pay Plan;
	 
	 	(iv)	 	was Disabled and who satisfied the requirements of paragraph
(i), (ii) or (iii) on the earlier of the date he was no longer eligible to
receive disability benefits under the applicable disability income plan or the
date he began receiving distributions from the applicable Pension Plan;
	 
	 	(v)	 	retired from employment with an Employer, who at retirement was
at least 50 year of age and had 10 or more years of Service and who was
eligible to participate in the Active Plan or a Prior Plan on the date before
retirement and who did not meet the requirements of (i), (ii), (iii), or (iv)
above.






	 	(b)	 	effective January 1, 2002, is a member of Group VI and who separated or retired
from employment with an Employer and who:




- 16 -









 












	 	(i)	 	was hired prior to January 1, 1999 and at the time of
retirement had attained at least age 55 and had accrued at least 10 years of
Service while eligible to participate in the Active Plan or a Prior Plan and
who was eligible to participate in the Active Plan or the Prior Plan on the day
before retirement;
	 
	 	(ii)	 	was hired prior to January 1, 1999 and at the time of
separation from service had attained at least age 50 and had accrued at least
10 years of Service while eligible to participate in the Active Plan or a Prior
Plan and who was separated from service under the applicable terms of the
Company Separation Pay Plan;
	 
	 	(iii)	 	was hired prior to January 1, 1999 and who was Disabled and
who satisfied the requirements of paragraphs (i) or (ii) on the earlier of the
date he was no longer eligible to receive disability benefits under the
applicable disability income plan or the date he began receiving distributions
from the applicable Pension Plan;
	 
	 	(iv)	 	prior to September 1, 2004, at separation from service is at
least 50 years of age and has accrued at least 10 years of Service and who was
eligible to participate in the Active Plan or a Prior Plan on the day before
separation and who did not meet the requirements of (i), (ii), or (iii) above,
whereby
the individual must pay the full cost of coverage hereunder until he attains
age 65, at which time his coverage under the Plan will end;
	 
	 	(v)	 	retires from employment with Flexsys LLC and who had attained
at least 50 years of age and accrued at least 10 years of Service with Flexsys
LLC and Pharmacia Corporation at the date of retirement and who was eligible to
participate in an Active Plan at the time such person was transferred to
Flexsys LLC on April 30, 1995 and who was at least 50 years of age at the time
of the transfer;




- 17 -









 






	 	(vi)	 	enrolls in the Plan and had attained at least 55 years of age
and 10 or more years of Service with Astaris LLC and the Company and who was
eligible to participate in an Active Plan at the time such person was
transferred to Astaris LLC on April 1, 2000 and who was at least 45 years of
age at the time of the transfer;






or




	 	(c)	 	effective September 1, 2004, is a member of Group VI and was hired prior to
January 1, 1999 and who prior to October 31, 2016:






	 	(i)	 	retires from employment with an Employer no later than age 65
and who at the time of retirement has attained at least age 60 and has accrued
at least 15 years of Service while eligible to participate in the Active Plan
or a Prior Plan and who was eligible to participate in the Active Plan or a
Prior Plan on the day before retirement;
	 
	 	(ii)	 	both attains at least 55 years of age and has accrued at least
10 years of Service on or before December 31, 2006, and retires from employment
with an Employer no later than age 65 while eligible to participate in the
Active Plan or a Prior Plan and who was eligible to participate in the Active
Plan or a Prior Plan on the day before retirement;
	 
	 	(iii)	 	both attains at least 55 years of age and has accrued at least
10 years of Service on or before retiring from employment and whose age plus
years of Service as of December 31, 2006 are equal to or greater than 75, and
who retires from employment with an Employer no later than age 65 while
eligible to participate in the Active Plan or a Prior Plan and who was eligible
to participate in the Active Plan or a Prior Plan on the day before retirement;
	 
	 	(iv)	 	was Disabled and who satisfied the requirements of paragraph
(i), (ii), or (iii) on the earlier of the date he was no longer eligible to
receive




- 18 -









 






	 	 	 	disability benefits under the applicable disability income plan or the
date he began receiving distributions from the applicable Pension Plan;
	 
	 	(v)	 	on or before December 31, 2006, retires from employment with
Flexsys and who at retirement is at least 50 years of age and has accrued at
least 10 years of Service with Flexsys and Pharmacia Corporation and who was
eligible to participate in an Active Plan at the time such person was
transferred to Flexsys on April 30, 1995 and who was at least 50 years of age
at the time of the transfer;
	 
	 	(vi)	 	effective January 1, 2007, retires from employment with Flexsys
no later than age 65 and who at the time of retirement has attained at least
age 60 and has accrued at least 15 years of Service with Flexsys and Pharmacia
Corporation and who was eligible to participate in an Active Plan at the time
such person was transferred to Flexsys on April 30, 1995 and who was at least
50 years of age at the time of the transfer;
	 
	 	(vii)	 	enrolls in the Plan and who had attained as of November 4,
2005 at least 55 years of age and 10 or more years of Service with Astaris LLC
and the Company and who was eligible to participate in an Active Plan at the
time such person was transferred to Astaris LLC on April 1, 2000 and who was at
least 45 years of age at the time of the transfer;
	 
	 	(viii)	 	effective January 1, 2005, an Employee who attains age 53 as of January 1,
2005 and who thereafter is involuntarily separated from service under the
applicable terms of the Company Separation Pay Plan having attained 10 years of
Service as of his separation date; or
	 
	 	(ix)	 	effective January 1, 2005, upon attainment of age 55, an
Employee whose sum of age plus years of Service as of January 1, 2007 equals or
exceeds 75 (“Combo 75”) and who was involuntarily separated from service under
the applicable terms of the Company Separation Pay Plan having attained age 50
as of his separation date.




- 19 -









 












	 	 	Notwithstanding any other provision of this Plan, an Employee who is not covered by a
collective bargaining agreement and hired or rehired on or after January 1, 1999 shall not
be a Retired Employee. For this purpose, an Employee who became an Employee as a result of a
corporate transaction that was effected on or after January 1, 1999, and/or who was never
offered or eligible for retiree welfare benefits from the Company, shall be deemed to have
been hired after January 1, 1999.
	 
	1.59	 	Retiree Liaison Committee. “Retiree Liaison Committee” means the three person liaison
committee appointed pursuant to the Retiree Settlement.
	 
	1.60	 	Service. “Service” shall include all vesting service as such term is defined in the Pension
Plan. Service shall exclude all service as a leased employee (as defined in Code Section
414(n)) and all service in a position designated by the Company or an Employer as an
independent contractor position regardless of whether such designation is subsequently
determined by a court or agency to have been erroneous or improper. With respect to an
Employee who transferred from the Company to Astaris LLC at the time of the formation of
Astaris LLC and who was at least 45 years old at the time of the transfer, Service shall
include years of service with Astaris LLC but not beyond the closing of the sale of Astaris
LLC to Israel Chemicals Limited on November 4, 2005.
	 
	1.61	 	Spell of Illness. “Spell of Illness” shall have the same meaning as such term has under
Medicare.
	 
	1.62	 	Spouse. “Spouse” shall mean a Retired Employee’s lawful opposite sex spouse.
	 
	1.63	 	Subsidiary. “Subsidiary” shall mean any subsidiary or affiliate of the Company, at least 80
percent of the stock of which is controlled by the Company by application of Code Sections
414(b) and 1563(a) or any subsidiary or affiliate of the Company under “common control” with
the Company by application of Code Section 414(c).
	 
	1.64	 	Surviving Spouse. “Surviving Spouse” means (a) the Dependent Spouse at the date of death of
a Retired Employee or (b) the Spouse at the date of death of an active Employee provided that
the active Employee had attained at least age 60 and had completed 15 years of Service while
eligible to participate in the Active Plan or a Prior Plan, or (c) the Spouse at the date of




- 20 -









 






	 	 	death of a Disabled Employee who satisfied the requirements of Section 1.58 (a) on his or her
date of death, or (d) the Dependent Spouse at the date of death of an active Employee who
satisfied the requirements of Section 1.58(b) or (c) on his or her date of death.
Notwithstanding the foregoing, Surviving Spouse shall not include a Spouse who is eligible for
coverage under the Active Plan as an Employee or under this Plan as an Employee or a Retired
Employee.
	 
	1.65	 	Terminated for Misconduct. “Terminated for Misconduct” shall mean an Employee has been
involuntarily separated from employment after January 1, 2006 due to his or her Misconduct.
Misconduct includes but is not limited to acts of embezzlement, or felonious violence against
another person on Company property or while representing the Company.






- 21 -











 





SECTION 2

ELIGIBILITY AND EFFECTIVE DATES OF COVERAGE





	2.1	 	Eligibility. Each Retired Employee shall be eligible for coverage under this Plan on the
first day he or she becomes a Retired Employee.
	 
	 	 	A Surviving Spouse as defined in Section 1.64(b), (c) or (d) shall be eligible for medical
and drug coverage under this Plan on the date after coverage of such Surviving Spouse under
the Active Plan ends. If a Surviving Spouse was not covered under the Active Plan, a Prior
Plan or the Plan as of the date of the death of the Retired Employee, such Surviving Spouse
can elect coverage under the Plan at any time, provided the Plan’s eligibility requirements
are met.
	 
	 	 	Each eligible Dependent of a Retired Employee shall be eligible for medical and drug
coverage under this Plan on the date the Retired Employee becomes eligible for coverage
under the Plan and elects coverage for such individual.
	 
	 	 	Notwithstanding the foregoing, an individual who has incurred Covered Medical Expenses and
Covered Drug expenses that would result in benefits in excess of the Maximum Aggregate
Benefit or whose coverage under a Prior Plan has ended under the terms of such Prior Plan
will not be eligible for coverage.
	 
	2.2	 	Effective Date of Coverage for Retired Employees and Surviving Spouses. The medical and drug
coverage under the Plan for an eligible Retired Employee or Surviving Spouse shall commence on
the effective date of an election to be covered, made by the Retired Employee or Surviving
Spouse in accordance with this Plan and in the manner specified by the Plan Administrator and
upon the payment of any required Medical Expense Contribution in the time and manner specified
by the Plan Administrator.
	 
	2.3	 	Effective Date of Coverage for Dependents. The medical and drug coverage under the Plan for an eligible Dependent of a Retired
Employee shall commence on the effective date of an election of a Coverage Category which
includes such Dependent made by the Retired Employee in accordance with this Plan.




- 22 -









 












	2.4	 	Initial Election by a Retired Employee. A Retired Employee’s initial election to be covered
for medical and drug benefits under this Plan may be made prior to the date he or she retires.
If such election is made in the manner specified by the Plan Administrator prior to the date
of retirement, the election shall be effective immediately upon retirement. If a Retired
Employee fails to make an election prior to retirement, such Retired Employee may elect to be
covered under the Plan only (i) during the Open Enrollment Period; or (ii) in such other
circumstances as the Plan Administrator shall specify. Any election made during an Open
Enrollment Period shall become effective as of the first day of the next Plan Year. Any other
election made shall become effective on the date specified by the Plan Administrator.
	 
	2.5	 	Election by Surviving Spouse. The initial election by a Surviving Spouse as defined in
Section 1.64(b), (c) or (d) to be covered under this Plan may be made (i) prior to the date
coverage under the Active Plan or a Prior Plan ends, or (ii) if the Surviving Spouse was not
covered under such Active Plan or a Prior Plan on the date of the Retired Employee’s death,
within 60 days from the date of death, or (iii) during an Open Enrollment Period, or (iv) in
such other circumstances as the Plan Administrator shall specify. If such election is made
before coverage ends under the Active Plan or a Prior Plan, the election shall be effective on
the date such coverage ends. If the Surviving Spouse was not covered under the Active Plan or
a Prior Plan on the date of the Retired Employee’s death and elects to be covered under the
Plan within 60 days from the date of death, such election shall be effective as of the day
immediately following the date of death. Any
election made during an Open Enrollment Period
shall become effective as of the first day of the next Plan Year. Any
other election made shall become effective on the date specified by the Plan Administrator.
	 
	2.6	 	Election by Dependent Spouse. Dependent Spouses of Retired Employees in Groups IIB, V and VI
may change elections during the Open Enrollment Period for themselves and any Dependent
child(ren), provided they otherwise meet eligibility requirements. Any





- 23 -









 











	 	 	election made during
an Open Enrollment Period shall become effective as of the first day of the next Plan Year.
	 
	2.7	 	Change in Election. A Participant may elect to cease to be a Participant or may change the
Coverage Category or, in the case of a Participant who is not a Medicare Eligible participant,
the Medical Plan Choice elected, only (a) during an Open Enrollment Period; or (b) in such
other circumstances as the Plan Administrator determines in its discretion to be appropriate.
A Surviving Spouse may elect to cover any Dependent child(ren) under the Plan who were covered
Dependents at the date of the Retired Employee’s death.
	 
	2.8	 	Cessation of Participation in Medical Plan Benefits. A Participant who elects to cease to be
a Participant in the Plan’s medical and drug benefits, who ceases to be a Participant in the
Plan’s medical and drug benefits due to attainment of the Maximum Aggregate Benefit or who
ceases to be a Participant in the Plan’s medical and drug benefits because of the failure to
pay the required Medical Expense Contribution shall not be eligible thereafter to elect to
become a Participant in the Plan’s medical and drug benefits again. The preceding sentence
shall not apply to a Participant who has ceased to be a Participant in the Plan’s medical and
drug benefits in order to participate in an HMO offered by the Employer.
	 
	2.9	 	Dependent Elections. A Retired Employee who elects not to cover an eligible Dependent at his initial election
to participate in the Plan shall thereafter be eligible to elect a Coverage Category which
includes such Dependent on a one-time only basis. Once a Retired Employee covers an
eligible Dependent under this Plan, the Dependent may not again become eligible to
participate if such coverage is subsequently terminated. However, a Surviving Spouse may
elect to participate in the Plan in accordance with the terms of this Section even if the
Retired Employee had not previously elected to cover such Surviving Spouse.





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SECTION 3

MEDICAL EXPENSE CONTRIBUTIONS





	3.1	 	Medical Expense Contribution. For each Plan Year, a Participant shall pay an annual Medical
Expense Contribution equal to the greater of either (i) or (ii) below:






	 	(i)	 	20% of the Annual Cost Per Covered Group, or
	 
	 	(ii)	 	the applicable Defined Dollar Limit Amount determined under Section 3.3.






	3.2	 	Annual Cost. The Annual Cost Per Participant and Annual Cost Per Covered Group shall be
determined as set forth in this Section 3.2.






	 	(a)	 	The Annual Cost Per Covered Group for a Plan Year (the “Determination Year”)
shall be determined by adding together the Annual Cost Per Participant for each covered
person in the group. Multiple Dependent children covered by a single Participant shall
be considered one covered person for this purpose.
	 
	 	(b)	 	The Annual Cost Per Participant for a Determination Year will be based upon a
projection of the Claims Costs for that year. The Annual Cost Per Participant will be
determined separately for Medicare Eligible Participants and those Participants who are
not Medicare Eligible Participants, both as determined using the process set forth
below in this Section 3.2.
	 
	 	(c)	 	The benefits for Covered Medical Expenses and expenses for Covered Drugs (other
than those paid for Dependent child(ren)) (jointly referred to as “Claims Costs”) for
the group for up to three years preceding the year in which the projection is being
made (“Experience Years”) will be established by the Plan actuary. Where, in the
judgment of the Plan actuary, the experience of the group for which the Annual Cost Per
Participant is being determined does not provide a credible basis for projecting
Determination Year Claims Costs, the experience of
Retired Employees of the Company and the Employers who participate in another
medical benefits plan maintained by the Company may be included in the group.





- 25 -









 











	 	(d)	 	The Claims Cost for each Experience Year will be projected to the Determination
Year using trend and Plan adjustment factors that the Plan actuary determines are
appropriate.
	 
	 	(e)	 	The average Claims Cost for each Experience Year will be determined by dividing
the projected amount determined pursuant to the immediately preceding paragraph by the
average number of Participants and Dependent Spouses in the Experience Year. The
average Claims Cost for the Determination Year will be determined as the weighted
average of these average Claims Costs for each Experience Year. The weighting will be
at the judgment of the Plan actuary, but in no event will a year have a weighting of
less than 20%.
	 
	 	(f)	 	The Annual Cost Per Participant for the Determination Year will be determined
by augmenting the average Claims Cost for the Determination Year by the reasonably
estimated expenses expected to be incurred in the administration of the Plan for the
Determination Year. These expenses shall include, but are not limited to, the
following items, whether performed internally or outsourced to others:






	 	•	 	systems necessary to administer the Plan;
	 
	 	•	 	retiree service center costs;
	 
	 	•	 	adjudication and payment of claims;
	 
	 	•	 	pricing and other financial analysis necessary for the management of the
Plan; and
	 
	 	•	 	expenses paid directly by Solutia associated with the VEBA trust established
to partially fund this Plan.






	 	(g)	 	The Annual Cost per Participant for a Dependent child or group of Dependent
children shall be equal to 40% of the Annual Cost Per Participant of a Participant who
is not a Medicare Eligible Participant.
	 
	 	(h)	 	The Annual Cost Per Participant for a Dependent Spouse shall equal the Annual
Cost Per Participant.





- 26 -









 











	 	(i)	 	The EBPC may modify this Section 3.2 with respect to Group VI to account for
changes in standard actuarial practices.






	3.3	 	Defined Dollar Limit Amount. The Defined Dollar Limit Amount shall be the difference between
the Annual Cost Per Covered Group and the Defined Dollar Limit applicable to a Covered Group.
	 
	 	 	The Defined Dollar Limit applicable to a Covered Group with respect to a Retired Employee or
Dependent Spouse (for Groups IIB, V and VI) or Surviving Spouse who is not Medicare
Eligible shall be determined by the following table:





	 	 	 	 	 
	 	 	   GROUPS IA, IB, IIA,
	 	 	   IIB, IIIA, IIIB, IV, V,
	COVERED GROUP	 	   and VI
	Retiree Only
	 	$	6,600	 
	Dependent Spouse or Surviving Spouse Only
	 	$	5,100	 
	Retiree & Spouse (under 65)
	 	$	11,700	 
	Retiree & Spouse (over 65)
	 	$	7,950	 
	Retiree & Child(ren)
	 	$	9,000	 
	Retiree, Spouse (under 65) & Child(ren)
	 	$	14,100	 
	Retiree, Spouse (over 65) & Children
	 	$	10,350	 







	 	 	The Defined Dollar Limit applicable to a Covered Group with respect to a Retired Employee
or Surviving Spouse who is Medicare Eligible shall be determined by the following table:





	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 GROUPS
	 	 	 	 	 	 	 	 	 	 	 IIA, IIB, IV,
	COVERED GROUP	 	GROUPS IA and IIIA	 	GROUPS IB and IIIB	 	 V, and VI
	Retiree Only
	 	$	2,000	 	 	$	1,800	 	 	$	1,650	 
	Surviving Spouse Only
	 	$	1,650	 	 	$	1,475	 	 	$	1,350	 
	Retiree & Spouse (under 65)
	 	$	7,100	 	 	$	6,900	 	 	$	6,750	 
	Retiree & Spouse (over 65)
	 	$	3,650	 	 	$	3,275	 	 	$	3,000	 
	Retiree & Child(ren)
	 	$	4,400	 	 	$	4,200	 	 	$	4,050	 
	Retiree, Spouse (under 65) & Child(ren)
	 	$	9,500	 	 	$	9,300	 	 	$	9,150	 
	Retiree, Spouse (over 65) & Children
	 	$	6,050	 	 	$	5,675	 	 	$	5,400	 






- 27 -









 







	 	 	For an Employee who is not covered by a collective bargaining agreement and who becomes a
Retired Employee after December 31, 2002 or the Dependent Spouse (for Groups IIB, V and VI)
or Surviving Spouse of such a Retired Employee, the applicable Defined Dollar Limit shall be
the amount determined under the above charts multiplied by a fraction, the numerator of
which is the Retired Employee’s complete years of Service (but no more than 25) and the
denominator of which is 25.
	 
	3.4	 	Medical Expense Contributions Equal to Cost. Notwithstanding any other provision of the Plan
to the contrary, a Retired Employee described in Sections 1.58(a)(v) and 1.58(b)(iv) or the
Dependent Spouse (for Groups IIB, V and VI) or Surviving Spouse of such a Retired Employee
shall pay an annual Medical Expense Contribution equal to the Annual Cost Per Participant for
the Participant and any covered Dependents.
	 
	3.5	 	No Adjustments. The Medical Expense Contribution will not be adjusted for Medicare Eligible
Participants who elect to participate in a Medicare Part D Plan (PDP) in lieu of the coverage
offered under this Plan.
	 
	3.6	 	Payments. The Company shall require that the annual Medical Expense Contribution be paid in
equal monthly installments and may permit such payments to be made through (a) a pension
deduction, for those Participants who receive pension benefits from the Company, or (b)
payments to the Company, for those Participants who do not receive pension benefits from the
Company. The Participant may elect that any such non-pension payments be made by automatic
debit of the Participant’s bank account.
	 
	3.7	 	Resolution Of Disputes Regarding Application of Methodology. If a Retiree Liaison Committee
has been appointed and is in existence, the Plan Administrator shall give the Retiree Liaison
Committee its final calculation of a Participant’s required Medical Expense Contribution under
Section 3 of this Plan. If the Retiree Liaison Committee believes the calculation has not
been made correctly, it may object to a calculation. The Plan Administrator and the Retiree
Liaison Committee shall use their best efforts to negotiate in good faith to resolve any
objection to the calculation.




- 28 -









 






	 	 	Members of the Retiree Liaison Committee are not ERISA fiduciaries. The Retiree Liaison
Committee shall have no obligation to any Participants or beneficiaries to challenge the
Plan Administrator’s calculation of a Participant’s required Medical Expense Contribution
under Section 3 of this Plan, and the right of a Participant to challenge, through the
claims procedures of the Plan and, if applicable, litigation, the validity of any such
calculation shall not be in any way impaired or diminished by any failure of the Retiree
Liaison Committee to challenge such calculation. Any litigation by a Participant challenging
such a calculation can be brought only in the United States District Court for the Eastern
District of Missouri.





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SECTION 4

SCHEDULE OF MEDICAL AND DRUG BENEFITS





	4.1	 	Schedule of Benefits for Participants Who Are Not Medicare Eligible.






	 	(a)	 	For Participants who are not Medicare Eligible Participants, Plan medical and
drug benefits shall be determined under the Active Plan and the Medical Plan Choice
elected by the Participant.
	 
	 	(b)	 	The Maximum Aggregate Benefit for a Participant or a covered Dependent who is
not a Medicare Eligible Participant shall be the amount specified in the Active Plan,
not to exceed $1,500,000, less benefits paid for Covered Medical Expenses and Covered
Drug expenses under any plan maintained by Pharmacia Corporation, the Active Plan and
any Prior Plan, but only to the extent such expenses were counted toward the maximum
aggregate benefit under the terms of any such plan and in the administration of any
such plan. Provisions under the Active Plan or a Prior Plan relating to reinstatement
of the Maximum Aggregate Benefit shall also apply to such Participant or Dependent.
With respect to any member of a Class covered by the Forsberg Settlement, the Maximum
Aggregate Benefit for a Participant or a covered Dependent who is not a Medicare
Eligible Participant shall be $1,500,000.
	 
	 	(c)	 	If coverage on account of a Participant or covered Dependent who is not a
Medicare Eligible Participant ceases because covered expenses in excess of the Maximum
Aggregate Benefit have been incurred under the Active Plan or a Prior Plan and such
person later becomes a Medicare Eligible Participant, coverage shall be reinstated when
the person becomes a Medicare Eligible Participant.






	4.2	 	Schedule of Benefits for Medicare Eligible Participants.






	 	(a)	 	For Medicare Eligible Participants, the following medical and drug Schedule of
Benefits shall apply:




- 30 -









 











SCHEDULE OF BENEFITS




	 	 	 	 	 
	Individual Deductible Amount per Plan Year	 	50% of Medicare Part A Deductible
	Covered Proportion (except where otherwise specifically stated in this Plan)

	 	 	80	%
	 
	 	 	 	 
	Retail Prescription Drugs Co-Payment
Amount (up to 30 day supply)

	 	Participant pays 20% up to a $50
maximum per prescription or
refill

	 
	 	 	 	 
	Mail Order Prescription Drugs Co-Payment
Amount (up to 90 day supply)

	 	Participant pays 20% per
prescription or refill

	 
	 	 	 	 
	Individual Maximum Aggregate Benefit

	 	$	65,000	 







	 	(b)	 	The Individual Maximum Aggregate Benefit shall apply only with respect to
medical or drug expenses incurred after a Participant or covered Dependent becomes a
Medicare Eligible Participant. Covered expenses incurred under a Prior Plan shall
count, but only to the extent such expenses were counted toward a maximum aggregate
benefit as a Medicare Eligible Participant under the terms of such Prior Plan and in
the administration of such Prior Plan. Any expenses for mental health or substance
abuse treatment incurred after January 1, 1995 and before January 1, 1998, under a
Prior Plan shall not count.
	 
	 	(c)	 	The Company shall notify Medicare Eligible Participants when the medical and
prescription drug expenses applied toward the Individual Maximum Aggregate Benefit
exceed 60 percent and 85 percent of the total Individual Maximum Aggregate Benefit.
Such notices shall include a summary of medical and prescription drug expenses applied
toward the Individual Maximum Aggregate Benefit through December 31, 2001, and annual
amounts applied thereafter.






	4.3	 	Benefits for Mental Health or Substance Abuse.






	 	(a)	 	If any services are rendered for psychiatric or psychological treatment,
consultation because of a mental or nervous condition, or treatment of substance abuse
for a Medicare Eligible Participant, benefits shall be determined under the following
Schedule of Benefits below:





- 31 -









 





	 	 	 
	Covered Proportion for Office Visit

	 	50% of first $80 per visit
	 
	 	 
	Covered Proportion for Hospital Visit

	 	50% of first $500 per day less
a $250 per stay co-pay
	 
	 	 
	Individual Annual Benefit (Inpatient)

	 	30 days
	 
	 	 
	Individual Maximum Annual Benefit (Outpatient)

	 	20 office visits
	 
	 	 
	Individual Maximum Lifetime Substance Abuse Treatments

	 	2 courses of treatment
(including treatments under the
Active Plan or a Prior Plan)







	 	(b)	 	A second course of substance abuse treatment is covered only if there are at
least 30 treatment-free days between the first and second course of treatment. If this
coverage is exhausted, further substance abuse coverage is limited to acute hospital
care for detoxification and 30 additional outpatient visits. If the Participant or
covered Dependent has not incurred Covered Medical Expenses for treatment of substance
abuse as provided in this Section for a period of at least five years, full substance
abuse coverage as described in this Section shall be reinstated.






	4.4	 	Sterilization Reversal Benefits. For any medical expenses incurred in connection with any
reversal of a sterilization procedure, not deemed to be Medically Necessary by the
Administrative Services Provider, a Covered Proportion of 50% shall be used with respect to
such expenses. Reversal of a sterilization procedure, not deemed to be Medically Necessary by
the Administrative Services Provider, shall be limited to one per lifetime. For purposes of
determining whether a Medicare Eligible Participant has reached the limit described in the
preceding sentence, reversal of a sterilization procedure under a Prior Plan or a medical plan
maintained by Pharmacia Corporation or the Active Plan not deemed to be “medically necessary,”
and performed after December 31, 1995 shall count.






	4.5	 	Maximum Aggregate Benefit. A Participant’s or covered Dependent’s coverage shall automatically cease when Covered
Medical Expenses and expenses for Covered Drugs 




- 32 -









 






	 	 	are incurred on account of the Participant
or covered Dependent in an aggregate amount such that the Maximum Aggregate Benefit will be
payable under the Plan.






	4.6	 	Requirements of Minimum Hospital Stays Following Childbirth. Notwithstanding any provision
of the Plan or Supplement hereto to the contrary, the following provisions shall apply:






	 	(a)	 	The length of any hospital stay in connection with childbirth for the mother or
newborn child with respect to which eligible expenses are covered under the Plan shall
be at least 48 hours following a normal vaginal delivery, or at least 96 hours
following a caesarean section; provided, however, that any such hospital stay may be of
a shorter duration than the foregoing 48 or 96 hours in any case in which the decision
to discharge the mother or newborn child prior to the expiration of the minimum length
of stay otherwise required is made by an attending health care provider in consultation
with the mother.




- 33 -









 











SECTION 5

MEDICAL AND DRUG BENEFITS





	5.1	 	Benefit Provisions for Participants Who Are Not Medicare Eligible. If a Participant incurs
on account of himself or herself, or on account of a Dependent while such Dependent is covered
under the Plan, Covered Medical Expenses and/or Covered Drug expenses during any Plan Year,
the Company shall pay benefits subject to the terms and limitations of the Active Plan and the
Medical Plan Choice elected by the Participant. Notwithstanding the preceding, this Section
shall not apply to any Participant or covered Dependent who is a Medicare Eligible
Participant.
	 
	 	 	The amount of benefits paid by the Company shall be subject to the Maximum Aggregate Benefit
applicable to a Participant who is not Medicare Eligible as specified in the Active Plan.
	 
	 	 	Notwithstanding any other provision of this Plan, effective January 1, 2007 for Retired
Employees, Dependent Spouses and Surviving Spouses in Groups IIB, V, and VI, coverage
hereunder for such individual shall cease upon the earlier of (a) the individual becoming a
Medicare Eligible Participant, or (b) October 31, 2016. Thus, no such individual who
becomes covered hereunder shall in any event be eligible for coverage after January 1, 2007
after attaining age 65 (or, if earlier, October 31, 2016). Dependent children’s coverage
shall end the later of (a) the earlier of the date the Retired Employee attains age 65 or
dies or (b) the earlier of the date the Dependent Spouse or Surviving Spouse attains age 65
or dies. In no event will coverage for Dependent children continue after October 31, 2016.
	 
	5.2	 	Benefit Provisions for Medicare Eligible Participants. If a Medicare Eligible Participant
incurs on account of himself or herself Covered Medical Expenses during any one Plan Year
which are in excess of the Deductible Amount for such Plan Year, the Company shall pay
benefits subject to the terms and limitations of the Plan in an amount determined under the
following formula:




- 34 -









 











CP x (CME- DA)

CP = Covered Proportion

CME = Covered Medical Expenses

DA = Deductible Amount





	 	 	The Covered Proportion shall be the percentage specified in the Schedule of Benefits in
Section 4.2 or other applicable provision of this Plan or any Supplement to this Plan.
Notwithstanding the foregoing, the amount of benefits paid by the Company shall be subject
to the Maximum Aggregate Benefit applicable to a Medicare Eligible Participant as specified
in the Schedule of Benefits in Section 4.2.




- 35 -









 











SECTION 6

COVERED MEDICAL AND DRUG EXPENSES AND EXCLUSIONS





	6.1	 	Covered Medical Expenses. “Covered Medical Expenses” with respect to a Participant or
covered Dependent who is not a Medicare Eligible Participant shall be determined under the
Active Plan. “Covered Medical Expenses” with respect to a Participant or covered Dependent
who is a Medicare Eligible Participant shall mean Reasonable and Customary charges incurred
for the types of Medically Necessary services specified below, other than those listed in
Section 6.2, rendered to the Medicare Eligible Participant or covered Dependent, as the case
may be, and which are performed or prescribed by a Physician.






	 	•	 	Hospital room and board and other hospital services required for medical or surgical
care or treatment excluding any charges for such services in excess of the inpatient
hospital deductible amount, as promulgated in accordance with Medicare, in any Spell of
Illness with respect to each person, except as provided below in this Section 6.1.
	 
	 	•	 	Hospital room and board, excluding (i) charges for the first 60 days of any Spell of
Illness, except as provided in the preceding item, (ii) charges in excess of one-half
of the inpatient hospital deductible amount, as promulgated in accordance with
Medicare, per day during the 61st day through the 90th day of any Spell of Illness, and
(iii) charges for room accommodations in excess of the hospital’s most common
semi-private room rate per day.
	 
	 	•	 	Other hospital services required for medical or surgical care or treatment and
received subsequent to the 90th day of any Spell of Illness and during the period for
which benefits on account of room and board are payable under the Plan.
	 
	 	•	 	Cost of the first three pints of whole blood during any Spell of Illness.
	 
	 	•	 	Services of registered graduate nurses including services of a licensed practical
nurse (L.P.N.) when the services of a registered nurse (R.N.) are not available and




- 36 -









 






	 	 	 	the Physician in charge of the case certifies that such services are Medically
Necessary.






	 	•	 	Services of psychiatrists in connection with treatment of mental illness, disorder
or disease.
	 
	 	•	 	Hospice and home health care services described in Sections 8 and 9, and skilled
nursing facility services of the type covered by Medicare.
	 
	 	•	 	Services for which benefits are provided under Part B of Medicare, excluding 80% of
the charges for such services in excess of the deductible amount under Part B with
respect to each person.






	6.2	 	Exclusions. Except as may be provided in Section 6.1 above or any applicable Supplement to
this Plan, expenses incurred by a Medicare Eligible Participant for any of the following shall
in no event be considered Covered Medical Expenses:






	 	•	 	Medical examinations or laboratory tests for checkup purposes where not incident and
necessary to treatment of injury or illness.
	 
	 	•	 	Any services received by the Medicare Eligible Participant because of any injury
arising out of or in the course of any employment for wage or profit or any sickness
entitling him to benefits under any workers’ compensation or occupational disease law.
	 
	 	•	 	Any hospital, surgical, mental health, and medical services, and any related
services and institutional confinement, to the extent that such services or confinement
are available under any plan or program established pursuant to the laws or regulations
of any government or under any plan or program in which any government participates
other than as an employer. In the case of any person who is not enrolled for all
coverage for which he or she has become eligible under any such plan or program,
services, confinement and payments available will
nevertheless include all benefits to which he or she would be entitled if he or she
were enrolled for all such coverage. The term “plan or program” includes, in the




- 37 -









 






	 	 	 	case of Medicare, Parts A and B. The term “any government” includes the federal,
state, provincial, or local government or any political subdivision thereof of the
United States or any other country. For purposes of this Plan, a person residing
outside of the United States shall be deemed to be eligible for Medicare, Parts A
and B, if such person would be eligible for such coverage if he or she was residing
in the United States. This provision is subject to any provision or regulation of
such plan or program which requires that covered benefits be utilized before
benefits are available thereunder.






	 	•	 	Any services received as a result of injury or sickness due to any act of war,
declared or undeclared, invasion or armed aggression, which act shall have occurred
after the effective date of coverage.
	 
	 	•	 	Any services for which there is no cost to the Medicare Eligible Participant or
which are provided by any medical, surgical, or hospital plan which the Company (or any
company subsidiary to or affiliated with the Company) contributes to or otherwise
sponsors.
	 
	 	•	 	Any service or supply which is experimental or investigational in terms of generally
accepted medical standards. An experimental service or supply is one that has been
applied primarily in a laboratory setting. An investigational service or supply is one
that has been applied to human subjects because it has a theoretically rational basis
or it has shown promise in preliminary study. In either case, no final conclusion has
been reached concerning the efficiency and/or effectiveness of the service or supply,
nor has a specific role in clinical evaluation, management or treatment been defined
for the service or supply.
	 
	 	•	 	Any service or supply which is not Medically Necessary.





For the purposes of the coverage evidenced herein, an expense is incurred on the date the service
or supply for which the charge is made was received or rendered.



- 38 -









 






	6.3	 	Covered Drug Expenses. “Covered Drug Expenses” with respect to a Participant or covered
Dependent who is not a Medicare Eligible Participant shall be determined under the Active
Plan. “Covered Drug Expenses” means, with respect to a Medicare Eligible Participant,
Contracted Amounts or Reasonable and Customary charges incurred for the types of Medically
Necessary services specified below, other than those listed under Section 6.4, rendered to the
Medicare Eligible Participant, as the case may be, and which are prescribed by a Physician.
	 
	 	 	If, as a result of a non-occupational illness or a non-occupational injury, any Covered Drug
is furnished to a Medicare Eligible Participant subject to the terms, limitations and
exclusions of this Section 6.3:






	 	(a)	 	if the Covered Drug is furnished by a Participating Provider, the Plan will pay
to the Participating Provider the cost of the Covered Drug as established by the
agreement between the Participating Provider and the prescription drug Administrative
Services Provider in excess of the Co-Payment Amount and the Participating Provider
will not charge the Participant or covered Dependent any amount that exceeds the
Co-Payment Amount subject to Subsection (c) of this Section 6.3.
	 
	 	(b)	 	if the Covered Drug is furnished by a Nonparticipating Provider, the Plan will
pay to the Participant the amount by which the Participating Provider Contracted Amount
of the Covered Drug exceeds the Co-Payment Amount, subject to Subsection (c) of this
Section 6.3.
	 
	 	(c)	 	if the Medicare Eligible Participant obtains a Brand Name Drug when a Generic
Drug is available, the Participant or covered Dependent will pay both the Co-Payment
Amount applicable to the Generic Drug and the difference between the cost of the Brand
Name Drug and the Generic Drug.



	6.4	 	Exclusions. No benefits shall be payable under this Plan for the following:








- 39 -









 












	 	(a)	 	the charge for any Covered Drug furnished to a Medicare Eligible Participant
prior to the date such person becomes covered under the Plan.
	 
	 	(b)	 	any charge for contraceptive devices, therapeutic devices or appliances,
support garments, drugs sold over the counter (regardless of whether or not furnished
pursuant to a Prescription Order) and other non-medicinal substances (except diabetic
testing agents) regardless of their intended use.
	 
	 	(c)	 	any charges for drugs other than Covered Drugs or for administration of a
Covered Drug or injection of insulin, and any charges not directly related and
necessary to the dispensing of a Covered Drug.
	 
	 	(d)	 	the charge for a quantity of a Covered Drug in excess of the amount normally
prescribed by Physicians. In no event will payment be made at the retail Pharmacy
level for greater than a 30-day supply of a Covered Drug or at the Mail Order Pharmacy
level for greater than a 90-day supply of a Covered Drug.
	 
	 	(e)	 	any Covered Drug furnished pursuant to a Prescription Order filled in excess of
the number specified by the Physician in such order, or any such refill dispensed after
one year from the date of the Prescription Order.
	 
	 	(f)	 	any charge for a Covered Drug for treatment of a condition not within the scope
of the Physician’s license.
	 
	 	(g)	 	any charge for drugs or medicine labeled: “Caution — limited by Federal Law to
investigational use”, or experimental drugs.
	 
	 	(h)	 	any Covered Drug that is not Medically Necessary.
	 
	 	(i)	 	any Covered Drug received as a result of any illness or injury due to an act of
war or a warlike action in time of peace.
	 
	 	(j)	 	the charge for any Covered Drug which is consumed at the time and place the
Prescription Order is filled.





- 40 -









 






	 	(k)	 	drugs covered by another plan that would have primary responsibility for
coverage as determined under the Plan’s coordination of benefits rules, including any
Medicare Part D Plan.






	6.5	 	Mail Order Prescription Drug Program. Claims for covered Maintenance Drugs shall be paid
only if the Prescription Order is filled through the Mail Order Prescription Drug Program by
following the procedures established by the Plan Administrator. Notwithstanding anything to
the contrary in this Section, the provisions of this Section 6.5 shall apply to any
Prescription Order filled through the Mail Order Prescription Drug Program.
	 
	 	 	Up to a 90-day supply of the covered Maintenance Drug shall be eligible for coverage if
filled within one year of the original date of the Prescription Order. Claims for the
initial supply and one 30-day refill shall be eligible for coverage if filled by a retail
pharmacy.
	 
	 	 	Notwithstanding anything to the contrary in this Plan, the Company may discontinue the Mail
Order Prescription Drug Program at any time.
	 
	6.6	 	Coordination with Medicare Part D. This Plan is not a “secondary” Plan with respect to
prescription drugs provided under a Medicare Part D Plan. A Participant or Dependent Spouse
who elects to enroll in a Medicare Part D Plan will not be eligible for reimbursement of
Covered Drug expenses under this Plan.






- 41 -












 





SECTION 7

PRE-ADMISSION CERTIFICATION AND CONCURRENT REVIEW



A Participant or covered Dependent who is not a Medicare Eligible Participant shall be subject to
the Pre-Admission Certification and Concurrent Review Requirements (and other similar requirements)
applicable to a Participant in the Active Plan who is covered under the same Medical Plan Choice.
This paragraph shall not apply to a Medicare Eligible Participant.



Prior to any scheduled hospital admission (other than for mental health and substance abuse
treatment) of any Medicare Eligible Participant or covered Dependent (in the case of an emergency
admission, within one working day or as soon as practicable after hospital admission), the
Administrative Services Provider must certify that the admission is Medically Necessary.
Confinement beyond the period originally certified must also be reviewed in advance with the
Administrative Services Provider to confirm that continued confinement is Medically Necessary.



All room and board and attending Physician charges resulting from days of hospital confinement
which are not pre-certified as Medically Necessary by the applicable Administrative Services
Provider: (a) for a hospital confinement that is not for mental health or substance abuse, Covered
Medical Expenses shall only be covered at 50%, and (b) for a hospital confinement that is for the
treatment of mental health or substance abuse, shall be excluded from Covered Medical Expenses
under this Plan. In the event of a disagreement between the attending Physician and the
Administrative Services provider, an appeal mechanism shall be provided by the Administrative
Services Provider. If the disagreement remains unresolved, the Medicare Eligible Participant may
request independent review, which shall be provided by a state Professional Review Organization or
by a panel provided by the local medical society.




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SECTION 8

HOSPICE CARE BENEFITS





	8.1	 	Hospice Care Benefits. When prescribed by a Physician and approved by the Administrative Services Provider, and
subject to the terms and conditions listed below, Covered Hospice Care Benefits on behalf of a
Medicare Eligible Participant shall be Covered Medical Expenses under the Plan.
	 
	 	 	The Plan will pay Covered Hospice Care Benefits for services or supplies incurred:






	 	(a)	 	on account of a Participant or covered Dependent who is enrolled in a
recognized and approved Hospice Care Program; and
	 
	 	(b)	 	for counseling of covered Dependents;






provided, the services are approved by the attending Physician and are part of, as
well as billed through, the approved Hospice Care Program.




	8.2	 	Services Or Supplies Which Are Covered Hospice Care Benefits. The following types of Hospice services and supplies are Covered Hospice Care Benefits:






	 	(a)	 	room and board in a Hospice Care Facility approved by the Administrative
Services Provider, but not any charge per day over the Hospice’s most common
semi-private room rate;
	 
	 	(b)	 	other Hospice services or supplies required for palliative care;
	 
	 	(c)	 	supplies including, but not limited to, medicines, medical supplies, drugs and
rental (or purchase, if more cost effective) of durable equipment;
	 
	 	(d)	 	intermittent skilled nursing care provided by either a Registered Nurse or a
Licensed Practical Nurse;
	 
	 	(e)	 	health care provided by a home health aide;




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	 	(f)	 	counseling for the patient after enrollment in the Hospice Care Program if the
attending Physician determines such counseling is necessary, and counseling for the
Participant and/or covered Dependents during the same period and up to a six-month
period after the death of the patient, if the terminal illness is the direct cause of
the need for counseling, which counseling must be provided by a Psychologist, a
licensed psychiatrist or a member of a state-licensed social service organization;
	 
	 	(g)	 	homemaker services when the patient’s family is unable to attend to the needs
of the patient, which homemaker services must be approved by the Hospice Care Program
and by the Administrative Services Provider and shall not be for more than a total of
seven days during the course of the Hospice Care Program;
	 
	 	(h)	 	physical, respiratory and speech therapy if approved by the attending Physician
and the Hospice Care Program;
	 
	 	(i)	 	dietary and nutritional assistance when provided by a licensed nutritionist or
dietician;
	 
	 	(j)	 	local ambulance or special transport services between the patient’s home and
the Hospice Care Facility if Medically Necessary; and
	 
	 	(k)	 	all other services provided through the Hospice Care Program if the services
are Medically Necessary.






	8.3	 	Exclusions. Expenses for the following types of services or supplies are not Covered Hospice Care
Benefits:






	 	(a)	 	purchase of durable medical equipment if rental is less costly;
	 
	 	(b)	 	any volunteer services or supplies or counseling by clergy which would normally
be provided free of charge;
	 
	 	(c)	 	private duty nursing;




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	 	(d)	 	services for legal or financial advice, preparation and execution of wills,
estate planning and financial investment;
	 
	 	(e)	 	services of a person who ordinarily resides in the home of the terminally ill
patient or a member of his or her family;
	 
	 	(f)	 	charges in excess of Reasonable and Customary charges;
	 
	 	(g)	 	any services not provided and billed through the Hospice Care Program unless
approved in advance by the Administrative Services Provider and by the patient’s
attending Physician.




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SECTION 9

HOME HEALTH CARE BENEFITS





	9.1	 	Home Health Care Benefits. When prescribed by a Physician and approved by the Administrative Services Provider, and
subject to the terms and conditions specified below, Home Health Care Benefits for a Medicare
Eligible Participant as an alternative to otherwise necessary in-patient confinement in a
hospital or skilled nursing facility shall be Covered Medical Expenses under the Plan.
	 
	9.2	 	Expenses Which Are Covered Home Health Care Benefits. Covered Home Health Care Benefits shall include the following Reasonable and Customary
charges for Medically Necessary services approved by the Administrative Services Provider:






	 	(a)	 	intermittent nursing care by or under the supervision of a professional
Registered Nurse (R.N.),
	 
	 	(b)	 	intermittent home health-aide services during the period skilled professional
services are required,
	 
	 	(c)	 	physical therapy, occupational therapy and speech therapy provided by a Home
Health Care Agency,
	 
	 	(d)	 	medical supplies, drugs and medications prescribed by a Physician, and
laboratory services, to the extent such items would have been Covered Medical Expenses
under Section 6.1 if the Medicare Eligible Participant had been confined in a hospital,
	 
	 	(e)	 	rental (or purchase if more cost effective) of durable medical equipment for
therapeutic use, and
	 
	 	(f)	 	any other medical services, supplies or equipment included in the Home Health
Care Plan which are prescribed by a Physician.






	9.3	 	Exclusions. The following types of expenses are not Covered Home Health Care Benefits:





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	 	(a)	 	expenses for services or supplies not included in the Home Health Care Plan,
	 
	 	(b)	 	expenses for services of a person who ordinarily resides in the home of the
Medicare Eligible Participant or is a member of the Participant’s family,
	 
	 	(c)	 	expenses for services and supplies that are not Medically Necessary,
	 
	 	(d)	 	expenses for services rendered in any period during which the Medicare Eligible
Participant is not under the continuing care of a Physician,
	 
	 	(e)	 	expenses for Custodial Care services,
	 
	 	(f)	 	expenses for services and supplies not approved by the Administrative Services
Provider, and
	 
	 	(g)	 	expenses for services or supplies incurred in excess of 90 Visits per calendar
year.






A “Visit” is a personal contact in the home of the Participant or covered Dependent by a
representative of the Home Health Care Agency for the purpose of providing skilled nursing
services; skilled physical, occupational, or speech therapy; or home health-aide services
while skilled services are required. Benefits for services beyond 90 Visits per calendar
year shall be Covered Medical Expenses only if approved by the Administrative Services
Provider.



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SECTION 10

MEDICAL CASE MANAGEMENT PROGRAM





	10.1	 	Definitions. For purposes of this Section, the following terms shall be defined as set forth below:






	 	(a)	 	“Alternate Medical Treatment Benefits” means benefits for expenses that the
Administrative Services Provider has approved before they are incurred, in connection
with a Specific Plan of Alternate Medical Treatment, regardless of whether such
expenses would otherwise be covered as Covered Medical Expenses under the other
provisions of the Plan.
	 
	 	(b)	 	“Consultant” means a Physician and/or a Nurse who is designated by the
Administrative Services Provider to coordinate the Medical Case Management Program.
	 
	 	(c)	 	“Covered Person” means a Participant or a covered Dependent.
	 
	 	(d)	 	“Medical Case Management Program” means the program provided by the
Administrative Services Provider wherein a Consultant reviews the plan of medical
treatment for a Covered Person who is not Medicare Eligible, whose medical condition is
caused by a Severe Personal Injury or Sickness, in order to determine whether the
Covered Person does or does not qualify for Alternate Medical Treatment Benefits.
	 
	 	(e)	 	“Nurse” means a registered nurse (R. N.).
	 
	 	(f)	 	“Proposed Plan of Alternate Medical Treatment” means a treatment plan developed
by a Consultant for a Covered Person for the Administrative Services Provider’s review
to determine if it can be approved as the Specific Plan of Alternate Medical Treatment.
	 
	 	(g)	 	“Severe Personal Injury or Sickness” means a catastrophic injury or sickness
for which inpatient hospitalization or a large amount of Covered Medical Expenses





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are expected to continue over a long period of time. The injuries or sicknesses include,
but are not limited to, the types listed below:




	 	o	 	Acquired Immune Deficiency Syndrome (AIDS)
	 
	 	o	 	Amputations
	 
	 	o	 	Amyotrophic Lateral Sclerosis (ALS)
	 
	 	o	 	Anorexia Nervosa
	 
	 	o	 	Bulimia
	 
	 	o	 	Cerebral Vascular Accident
	 
	 	o	 	Chronic Obstructive Lung Disease
	 
	 	o	 	Chronic Obstructive Pulmonary Disease (COPD)
	 
	 	o	 	Crohn’s Disease
	 
	 	o	 	High Risk Newborn
	 
	 	o	 	Major Head Trauma
	 
	 	o	 	Multiple Fractures
	 
	 	o	 	Multiple Sclerosis
	 
	 	o	 	Neonatal High Risk Infants
	 
	 	o	 	Neonatal, Medical or Post Surgical Complications
	 
	 	o	 	Organ Transplants
	 
	 	o	 	Osteomyelitis
	 
	 	o	 	Selected Blood Dyscrasias
	 
	 	o	 	Selected Psychiatric Conditions
	 
	 	o	 	Selected Osteoarthritis
	 
	 	o	 	Severe Burns
	 
	 	o	 	Severe Rheumatoid Arthritis
	 
	 	o	 	Severe Stroke
	 
	 	o	 	Spinal Cord Injury






	 	(h)	 	“Specific Plan of Alternate Medical Treatment” means a Proposed Plan of
Alternate Medical Treatment approved by the Administrative Services Provider
as the treatment plan it will suggest for a Covered Person who has a Severe Personal
Injury or Sickness.




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	10.2	 	Medical Case Management Program.






	 	(a)	 	Identification and Notice. A Consultant must be notified in order for
a Covered Person who is not Medicare Eligible and who has a Severe Personal Injury or
Sickness to be considered for Alternate Medical Treatment Benefits under the Medical
Case Management Program. The notice may be given either:






	 	(i)	 	directly by telephone or written notice from the Company,
Participant or Covered Person’s Physician to the Administrative Services
Provider; or
	 
	 	(ii)	 	indirectly by the Administrative Service Provider’s utilization
review of the Covered Person’s medical claim forms.






	 	(b)	 	Evaluation. When notified, the Consultant will confer with the Covered
Person’s Physician in order to evaluate the Covered Person’s current and projected plan
of medical treatment and discuss whether the Covered Person is a candidate for the
Medical Case Management Program.
	 
	 	(c)	 	Development. The Consultant will develop for the Covered Person a
Proposed Plan of Alternate Medical Treatment which meets the guidelines of the program.
	 
	 	(d)	 	Review and Approval. The Administrative Services Provider will review
the Proposed Plan of Alternate Medical Treatment for the Covered Person. Such proposed
plan will be approved as the Specific Plan of Alternate Medical Treatment, if the
Administrative Services Provider determines that:






	 	(i)	 	in its estimation, the Proposed Plan of Alternate Medical
Treatment would be more cost effective than the current and/or projected plan
of medical treatment for that Covered Person; and
	 
	 	(ii)	 	the Proposed Plan of Alternate Medical Treatment would be in
the best interest of the Covered Person.






	 	(e)	 	Acceptance or Denial. The Specific Plan of Alternate Medical Treatment
is voluntary. The Covered Person and his or her attending Physician may either




- 50 -









 












agree to, or decline, the Specific Plan of Alternate Medical Treatment. If the Specific Plan
of Alternate Medical Treatment is agreed to, the Covered Person will be eligible to
receive Alternate Medical Treatment Benefits in addition to the benefits under the
other provisions of the Plan.




If the Specific Plan of Alternate Medical Treatment is declined, expenses for the
Covered Person will be considered for payment in accordance with the other
provisions of the Plan and the Covered Person will not be eligible to receive
Alternate Medical Treatment Benefits.




	 	(f)	 	Review of Specific Plan of Alternate Medical Treatment. While a
Specific Plan of Alternate Medical Treatment is in progress, the Consultant will
continue to review such plan and the Covered Person’s progress. If in the
Administrative Services Provider’s judgment it is deemed appropriate, the Consultant,
with the consent of the attending Physician and Covered Person, will modify such plan.
	 
	 	 	 	The Administrative Services Provider has the right to terminate the Covered Person’s
participation in the Medical Case Management Program upon notice to the Covered
Person and the attending Physician in certain circumstances, including, but not
limited to:






	 	(i)	 	The Administrative Services Provider determines that the
Specific Plan of Alternate Medical Treatment will not satisfy one or more of
the criteria set forth in Sections 10.2(d) or 10.3;
	 
	 	(ii)	 	The Administrative Services Provider determines, in its
discretion, that there is lack of Covered Person or family cooperation in
implementing the Specific Plan of Alternate Medical Treatment; or
	 
	 	(iii)	 	The Covered Person’s medical condition is stabilized with
maximum return to independent living.






	 	(g)	 	Voluntary Withdrawal. A Covered Person may voluntarily withdraw from
the Medical Case Management Program at any time by notifying the Administrative




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Services Provider. No Alternate Medical Treatment Benefits shall be paid under this
Section for expenses incurred after the date of withdrawal.




	10.3	 	Payment of Alternate Medical Treatment Benefits. The Company will pay Alternate Medical Treatment Benefits for expenses incurred by a Covered
Person as set forth in Section 10.6 below, only if:






	 	(a)	 	The Administrative Services Provider determines that:






	 	(i)	 	the expenses will be incurred for a medical condition;
	 
	 	(ii)	 	instead of the expenses for Alternate Medical Treatment
Benefits, the Covered Person would incur other expenses which are covered by
the other provisions of the Plan for the medical condition involved; and
	 
	 	(iii)	 	it is estimated by the Administrative Services Provider that
total anticipated expenses for Alternate Medical Treatment Benefits would be
less than the total anticipated expenses covered by the other provisions of the
Plan.






	 	10.4	 	Amount of Alternate Medical Treatment Benefits . The Administrative Services Provider will pay up to 100% of the amount of the actual charges
incurred for the services and supplies set forth in Section 10.6 received by a Covered Person;
provided such charges are approved by the Administrative Services Provider before they are
incurred by a Covered Person.
	 
	 	10.5	 	Maximum Benefit. The maximum benefit payable for expenses incurred for Alternate Medical Treatment Benefits
and the expenses incurred under the other provisions of the Plan or any Prior Plan combined
shall not, in the aggregate, exceed the Covered Person’s Maximum Aggregate Benefit set forth
in the applicable Schedule of Benefits in Section 4.




- 52 -









 






	 	10.6	 	Covered Alternate Medical Treatment Expenses. The following services and supplies may, in the sole discretion of the Administrative
Services Provider, be considered as covered Alternate Medical Treatment Expenses:






	 	(a)	 	Medical services or supplies, such as:






	 	(i)	 	Home health care services, including but not limited to, total
parenteral nutrition (TPN), antibiotic administration, cardiac rehabilitation,
respiratory therapy, drugs and durable medical equipment;
	 
	 	(ii)	 	Extended care facility services; and
	 
	 	(iii)	 	Rehabilitation services.






	 	(b)	 	Non-medical services or supplies, which may:






	 	(i)	 	improve a Covered Person’s medical condition;
	 
	 	(ii)	 	aid in rehabilitating the Covered Person; or
	 
	 	(iii)	 	facilitate independent living.




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SECTION 11

CLAIMS





	11.1	 	Filing and Payment of Medical Claims. Except as provided in any applicable Supplement to this Plan, any benefits referred to
herein shall be paid to the Participant as they accrue upon receipt of written proof
acceptable to the Plan Administrator that the medical or drug expenses for which claim is made
were actually incurred on the dates specified and that the services were found to be Medically
Necessary and recommended and approved by a Physician or surgeon. Notwithstanding the
preceding, the Participant may assign the benefits payable hereunder to the Physician or other
provider of medical services, in which case benefits will be paid directly to the Physician or
other provider of medical services. As a condition of claim payment, the Participant or
covered Dependent (or parent if the covered Dependent is a minor child) shall authorize the
Administrative Services Provider to audit records to assure that charges are proper. A report
of audit results shall be furnished to the Participant upon request. If a hospital bill audit
conducted by the Administrative Services Provider results in a request for a corrected bill or
refund, a copy of such corrected bill shall be provided to the Participant upon his request.
	 
	 	 	A Medicare Eligible Participant or a Participant or covered Dependent who becomes eligible
after retirement but before age 65 for benefits under Medicare solely as a result of
disability must submit a claim to Medicare first and must submit the Medicare Explanation of
Benefits with any claim filed under this Plan.
	 
	 	 	Notwithstanding the foregoing, no benefit shall be payable hereunder for which a claim is
filed more than two years from the date the medical or drug expenses for which claim is made
were actually incurred. 
	 
	11.2	 	Payment of Prescription Drug Claims. If Covered Drugs are furnished by a Participating Provider pursuant to an agreement between
the Participating Provider and the prescription drug Administrative Services Provider, the
Contracted Amount of such Covered Drugs over the Co-payment Amount shall be paid directly to
the Participating Provider.




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	 	 	If Covered Drugs are furnished by a Nonparticipating Provider, the Plan will pay to the
Participant the amount by which the Participating Provider Contracted Amount of the Covered
Drug exceeds the Co-Payment Amount.
	 
	11.3	 	Overpayment or Other Reimbursement. If benefits are paid under the Plan and it is later established that the person to whom the
benefits were paid was not entitled to the benefits or that the person was otherwise
reimbursed for such benefits, the Company shall be entitled to a refund from such person in
the amount of such benefits. Further, the Company shall be subrogated to the extent of
benefits paid to any claim or right of recovery of the Participant or person to whom benefits
were paid arising out of or relating to expenses for which benefits were paid, including
without limitation, a claim arising because of the application of Section 15.5.
	 
	11.4	 	Additional Procedures. Either the Administrative Services Provider or the Plan Administrator may in its discretion
institute other reasonable procedures for making claims under the Plan.
	 
	11.5	 	Claims and Review Procedures.






	 	(a)	 	Claims Procedure. Any claim for specific benefits under the Plan shall
be made in accordance with this Plan and any applicable insurance policy or health
maintenance organization (“HMO”) agreement directly to the Administrative Services
Provider, insurer or HMO, as applicable, providing coverage or services under the Plan
in accordance with the applicable insurance policy or service contract between the
Company and such Administrative Services Provider, insurer or HMO. The person or
entity designated in such documents or otherwise appointed by the EBPC (but not the
EBPC) to receive and process claims shall herein be referred to as a “Claims
Administrator.”
	 
	 	(b)	 	Authorized Representative. Nothing in this Section 11.5 shall preclude
an authorized representative of a claimant from acting on behalf of such claimant in
pursuing a benefit claim or appeal of an adverse benefit determination under the




- 55 -









 












Plan.
The Claims Administrator shall establish reasonable procedures for determining whether
an individual has been authorized to act on behalf of such claimant, provided that, in
the case of a claim involving urgent care, a health care professional with knowledge of
the claimant’s medical condition shall be permitted to act as the authorized
representative of the claimant.




	 	(c)	 	Review of Claim. The Claims Administrator shall review all claims for
benefits under the Plan and make claim determinations in accordance with the terms of
the Plan and shall apply such Plan provisions consistently with respect to similarly
situated claimants.
	 
	 	(d)	 	Notification of Benefit Determinations. For purposes of these
procedures, a claimant will be deemed to receive a written notice: (i) the date the
notice is delivered in person, (ii) the date delivery is confirmed by the United States
Postal Service or other commercial delivery service, (iii) or 3 days after the date the
notice is mailed to the claimant’s last known address on file with the Plan, unless it
can be shown to the Plan Administrator’s satisfaction that the notice was in fact
received at a later time. The Claims Administrator or its designated agent shall
provide notice to the claimant in the manner and at the times as described below.






	 	(i)	 	Initial Claim.






	 	(A)	 	Categories of Claims. All claims will
be classified into one of the following three categories.






	 	(I)	 	Pre-Service Claims.
“Pre-Service Claims” are claims for benefits the receipt of
which are conditioned on obtaining approval prior to obtaining
medical care.
	 
	 	(II)	 	Urgent Care Claims.
“Urgent Care Claims” are Pre-Service Claims where any delay in
treatment could endanger the claimant’s health or life or the
ability of the claimant to regain maximum function, or in the
opinion of





- 56 -









 











a physician with knowledge of the claimant’s medical
condition, subject him to severe pain that cannot be adequately
managed without the care or treatment that is the subject of the
claim. The determination of whether a claim is an “Urgent Care
Claim” shall be made by the Claims Administrator or its
designated agent applying the judgment of a prudent layperson
who possesses an average knowledge of health and medicine.




	 	(III)	 	Post-Service Claims.
“Post-Service Claims” are all claims for benefits that are not
Pre-Service Claims or Urgent Care Claims.
	 
	 	(IV)	 	Disability Claims.
“Disability Claims” are all claims for benefits based on a
determination of Disability with respect to a Participant.






	 	(B)	 	Notice of Improperly Filed Pre-Service and
Urgent Care Claims. If the claimant fails to file a Pre-Service
Claim or an Urgent Care Claim properly, he will be notified within 5
days for Pre-Service Claims, or within 24 hours for Urgent Care Claims,
that his claim was not filed properly. This notification may be given
orally, unless the claimant asks for it in writing. This notice will
not be sent unless, at a minimum, (i) the claim is received by a person
or organizational unit that is customarily responsible for handling
benefit matters, and (ii) the claim contains the claimant’s name, a
specific medical condition or symptom, and a specific treatment,
service, or product for which approval is requested.
	 
	 	(C)	 	Notice of Incomplete Claims.






	 	(I)	 	Urgent Care Claims. If a
claimant properly files an Urgent Care Claim, but the Plan
Administrator needs more




- 57 -









 












information to process the claim, the
claimant will be notified within 24 hours of receipt of his
claim of the additional information that is needed. The
claimant will then have at least 48 hours to provide the
additional information. The claimant will be notified of the
decision on his Urgent Care Claim within 48 hours after he
submits the additional information. If the claimant does not
submit the additional required information, he will be notified
of the decision on his claim within 48 hours after the end of
the deadline to provide such information.




	 	(II)	 	Pre-Service and Post-Service
Claims. For Pre-Service Claims and Post-Service Claims, the
claimant may be notified in writing that there is not enough
information to process his claim. This notice, if given, will
be provided within 15 days for Pre-Service Claims or within 30
days for Post-Service Claims after the claim is received. If
this notice is sent, it will specifically describe the missing
information, and the claimant will be given at least 45 days
within which to provide such information.






	 	(D)	 	Time for Initial Decision. A
determination on a claim will be made and the claimant will be notified
of that decision within the following time periods after the claim is
received: (i) 72 hours for Urgent Care Claims; (ii) 15 days for
Pre-Service Claims; and (iii) 30 days for Post-Service Claims and (iv)
45 days for Disability Claims. If, due to matters beyond the control
of the Plan, additional time is needed to process a Pre-Service Claim
or a Post-Service Claim, the claimant will be notified in writing of up to a
15-day extension for a Pre-Service Claim or up to a 30-day extension
for a Post-Service Claim or Disability Claim within the time period
for making the initial benefits decision. The notice





- 58 -









 











will explain
the circumstances requiring the extension and the date by which the
Plan Administrator, or its designee expects to make a decision on the
claim, which shall be no later than 30 days after a Pre-Service Claim
is received, or 45 days after a Post-Service Claim is received or 75
days after a Disability Claim is received. If the extension is
necessary due to missing or incomplete information needed to process
the claim, the extension notice shall describe this information and
the claimant will be afforded at least 45 days to provide such
information. During this time, the time periods for making a claims
determination described above will be suspended until the earlier of
the date the claimant provides the necessary information or the
expiration of the time period in which he has to provide it.




	 	(E)	 	Notice of Initial Decision. If a claim
is denied in whole or in part, the claimant will be notified in writing
of the specific reasons for the decision. For Urgent Care Claims, the
initial denial notice may be given orally. If so, it shall be followed
up in writing within 3 days.
	 
	 	 	 	The denial notice will also include the following information: (i)
references to the specific Plan provisions(s) upon which the decision
was based; (ii) a description of any additional material or
information necessary for the claimant to perfect his claim and an
explanation of why such material or information is necessary; (iii) a
description of the Plan’s review procedures and the applicable time
limits; and (iv) a statement of the claimant’s right to bring a civil
action under ERISA Section 502(a) following an adverse
benefits determination on appeal. If an internal rule, guideline,
protocol or other similar criterion was relied upon in making the
determination, the notice will include a statement that a description
of such rule will be provided free of charge upon request. If the




- 59 -









 












denial was based on medical necessity, experimental treatment or
similar exclusion, the notice will include a statement that an
explanation of the scientific or clinical judgment that formed the
basis for the decision, applying the terms of the Plan to the
claimant’s medical condition will be provided free of charge upon
request.




	 	(ii)	 	Special Rules for Concurrent Claims. If a pre-approved
hospital stay or course of treatment to be provided over a period of time or
number of treatments is limited or reduced, the affected individual will be
given advance written notice of this decision (which shall contain the
information described in Section 11.5(d)(i)(E) above) in sufficient time to
permit the individual to appeal the decision and obtain a decision before the
date on which the care or treatment is no longer approved.
	 
	 	 	 	If the claim to extend the course of treatments beyond the period of time or
number of treatments is an Urgent Care Claim, a decision on the claim will
be made as soon as possible, but no later than 24 hours after receipt of the
claim, provided that the claim is received at least 24 hours prior to the
expiration of the prescribed period of time or number of treatments. If the
claim is not received at least 24 hours prior to the expiration of the
prescribed period of time or number of treatments, the claim will be handled
as an initial claim for benefits in accordance with the procedures described
in Section 11.5(d)(i) above. If the claim is denied, the claimant may be
notified orally or in writing. An oral notice will be followed up in
writing within 3 days after the oral notice is given.
	 
	 	(iii)	 	Appealing an Adverse Decision






	 	(A)	 	Time Limits to Appeal. If a claim is
denied in whole or in part, the claimant or his authorized
representative has up to 180 days after the claimant receives notice of
the




- 60 -









 












decision to request that the decision be reviewed. Appeals must be
submitted in writing or, in the case of an Urgent Care Claim, may be
orally given to the Plan Administrator or its designated agent for such
appeals which shall not be the Claims Administrator.




	 	(B)	 	Rights on Appeal. In connection with
an appeal, the claimant or his authorized representative may submit
written comments, documents, records, and other information with
respect to his claim, regardless of whether or not such information was
considered in connection with the initial benefits determination. Upon
request and free of charge, the claimant will be provided reasonable
access to and copies of all documents, records and other information
relevant to his claim for benefits. A document, record or other
information shall be considered relevant to the claim if it (i) was
relied on in making the benefit determination, (ii) was submitted,
considered or generated in the course of making the benefit
determination without regard to whether it was relied on in making the
benefit determination, (iii) demonstrates compliance with the claims
procedures of this Section 11.5 or (iv) constitutes a statement of
policy or guidance with respect to the Plan concerning claimant’s
diagnosis without regard to whether it was relied on in making the
benefit determination. If a medical expert was consulted in connection
with the initial benefits determination, the claimant will be given the
identity of such individual upon request. In addition, for Urgent Care
Claim appeals, all necessary information, including the notice of the
final benefits determination, may be transmitted by telephone,
facsimile, or other available similarly expeditious methods.
	 
	 	 	 	The Plan Administrator will fully and fairly review each appeal,
taking into account any additional information submitted in
connection with the appeal. Deference will not be afforded to any




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prior benefits determination. If the appeal is based in whole or
part on medical judgment, a health care professional who has the
appropriate training and experience in the field of medicine involved
in the medical judgment, and who is not the same individual (or his
or her subordinate) who was consulted in connection with the initial
benefits determination, will be consulted with.




	 	(C)	 	Time for Decision on Appeal. The
claimant will be notified of the decision on appeal within the
following time periods after receipt of the appeal: (1) 72 hours for
Urgent Care Claim appeals, (2) 30 days for Pre-Service Claim appeals,
and (3) 45 days for Disability Claim appeals and (4) 60 days for
Post-Service Claim appeals.
	 
	 	(D)	 	Notice of Decision on Appeal. If an
appeal is denied in whole or in part, the claimant will be notified in
writing of the specific reasons for the decision. The denial notice
will also include the following information: (i) references to the
specific Plan provision(s) upon which the decision was based; (ii) a
statement that, upon request and free of charge, the claimant will be
provided reasonable access to and copies of all documents, records and
other information relevant to his claim for benefits; and (iii) a
statement of the claimant right to bring a civil action under section
502(a) of ERISA. If an internal rule, guideline, protocol or other
similar criterion was relied upon in making the determination, the
notice will include a statement that a description of such rule will be
provided free of charge upon request. If the denial was based on
medical necessity, experimental treatment or similar exclusion, the
notice will include a statement that an explanation of the scientific
or clinical judgment that formed the basis for the decision, applying
the terms of the Plan to the claimant’s medical condition will be
provided to the claimant free of charge upon request.




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SECTION 12

PROVISIONS APPLICABLE AT THE DEATH OF A RETIRED EMPLOYEE



The coverage provided under the Plan to a covered Dependent Spouse is further continued on and
after the death of the Retired Employee subject to all the conditions and limitations of the Plan.
Such covered Dependent Spouse shall become a Surviving Spouse eligible to make elections for
coverage as provided in Section 2. The coverage provided under the Plan to any Dependent who is
not a Spouse of a Retired Employee in Groups IA, IB, IIA, IIIA, IIIB, and IV shall automatically
cease on the date of the Retired Employee’s death, except to the extent such Dependent is eligible
for continuation coverage under COBRA as described in Section 14. For the Dependent children of
each Retired Employee in Groups IIB, V and VI, coverage will cease hereunder at the earlier of (a)
the Dependent child ceasing to meet the criteria for Dependent, (b) the later of the cessation of
coverage of the Retired Employee or the Dependent Spouse or Surviving Spouse due to death or
attaining age 65, or (c) October 31, 2016.





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SECTION 13




CESSATION OF MEDICAL AND DRUG COVERAGE





	13.1	 	Termination of Medical and Drug Coverage. Notwithstanding any other provision of the Plan,
and subject to Sections 13.2 through 13.6 below, beginning January 1, 2007 with respect to
Groups IIB, V, and VI, coverage for medical and drug benefits of a Retired Employee, Surviving
Spouse and Dependent Spouse shall end no later than the earlier of (i) when such Retired
Employee or Spouse becomes a Medicare Eligible Participant and (ii) October 31, 2016. With
respect to Dependent children of such Retired Employee or Surviving Spouse, coverage will end
the earliest of the date (a) the Dependent child ceases to meet the criteria for Dependent,
(b) the later of the cessation of coverage of the Retired Employee or the Dependent Spouse or
Surviving Spouse due to death or attaining age 65, or (c) October 31, 2016, subject to the
requirements of COBRA. Notwithstanding any other provision of the Plan to the contrary, no
benefits will be paid under the Plan with respect to any claim incurred after the applicable
date described in the preceding sentences.
	 
	13.2	 	Loss of Dependent Status. All coverage for any covered Dependent shall automatically cease
on (a) in the case of divorce, the date immediately preceding the date such person ceases to
be a Dependent Spouse of such Participant or (b) in any other situation where a Dependent
child ceases to be a Dependent, the last day of the month in which such child ceases to be a
Dependent.
	 
	13.3	 	Failure to Make Required Payments. Coverage for a Participant and any covered Dependents of
the Participant shall cease if the Participant fails to make Medical Expense Contributions as
required by this Plan. If the Company terminates coverage under this provision, it shall give
at least 30 days prior notice of the termination and shall permit the Participant to avoid
termination by paying any required Medical Expense Contributions within 30 days of the date of
the notice. The failure of the Company to terminate a Participant’s or Dependent’s coverage
under this
provision shall not constitute a waiver of its right to terminate coverage under this
provision in the future with respect to that Participant or Dependent or any other
Participant or Dependent.




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	13.4	 	Maximum Aggregate Benefit. Coverage on account of a Participant or covered Dependent shall
automatically cease when Covered Medical Expenses and Covered Drug Expenses are incurred on
account of the Participant or covered Dependent in an aggregate amount in excess of the
Maximum Aggregate Benefit.
	 
	13.5	 	Cancellation of Medical and Drug Coverage. If a Retired Employee or Surviving Spouse cancels
medical and drug coverage on behalf of himself and/or his covered Dependents, such Participant
and/or Dependents shall not be eligible to rejoin the Plan’s medical and drug benefits at a
later time.
	 
	13.6	 	Medical and Drug Benefits After Cessation of Coverage. If coverage ceases for a Participant
or covered Dependent, and the Participant or covered Dependent is then under the care of a
Physician or surgeon for treatment of an injury or a sickness, the Administrative Services
Provider shall continue to pay benefits for such injury or sickness as if the Participant’s or
covered Dependent’s coverage continued in force; provided that:






	 	(a)	 	no benefits shall be payable on account of any Covered Medical Expenses
incurred after the date three months following the first to occur of: (i) the date of
cessation of coverage or (ii) the date of recovery from the injury or sickness for
which the Participant or covered Dependent was being treated when coverage ceased
unless the Participant or covered Dependent is totally disabled continuously from the
date of such cessation during the period such expenses are incurred, and
	 
	 	(b)	 	if the Participant or covered Dependent is totally disabled continuously from
the date coverage ceased, benefits will continue to be provided during such disability
under the same conditions as if the coverage continued in force, but in no case shall
any benefits be payable on account of any Covered Medical Expenses incurred more than
two years after the date coverage ceased.




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	 	 	 	Notwithstanding the preceding, coverage shall automatically cease for an individual when the
aggregate Covered Medical Expenses and Covered Drug Expenses incurred on account of the
Participant or covered Dependent equal the Maximum Aggregate Benefit.




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SECTION 14

COBRA CONTINUATION COVERAGE



Each covered Dependent or Surviving Spouse who would cease to be covered under the Plan because of
a qualifying event as defined in Code Section 4980B(f)(3) (or any successor to such Section) and
who is a qualified beneficiary within the meaning of Code Section 4980B(g)(1) (or any successor to
such Section) and the regulations thereunder will be permitted to make an election to continue such
coverage but only to the extent required by, and in accordance with Code Section 4980B (or any
successor to such Section). If a covered Dependent makes such election, coverage shall continue
until the earliest of the events to occur under Code Section 4980B(f)(2)(B) and the regulations
thereunder. Notwithstanding any other provision of this Plan, coverage hereunder shall constitute
“alternative coverage” to the maximum extent permitted pursuant to Treasury Regulation Section
54.4980B-7.





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SECTION 15

COORDINATION OF BENEFITS





	15.1	 	Definitions. For purposes of this Section, the following definitions apply:






	 	(a)	 	Plan. “Plan” means any plan (other than this Plan) providing benefits
or services for or by reason of medical or dental or prescription drug care or
treatment, which benefits or services are provided by (i) any group insurance plan,
group-type coverage, or any other plan covering individuals or members as a group,
whether insured or uninsured; (ii) any group hospital service prepayment plan, group
medical service prepayment plan, group practice, individual practice, group or
individual automobile no-fault insurance, medical benefits written on group or
group-type automobile fault insurance, other group prepayment coverage, or health
maintenance organization; (iii) any coverage under governmental programs, or any
coverage required or provided by law. This does not include a state plan under
Medicaid (Title XIX, Grants to States for Medical Assistance Programs, of the United
States Social Security Act, as amended from time to time). Each contract or other
arrangement for coverage under (i) or (ii) is a separate plan. Also, if an arrangement
has two parts and Coordination of Benefits rules apply only to one of the two, each of
the parts is a separate plan.
	 
	 	(b)	 	Primary Plan/Secondary Plan. The order of benefit determination rules
in Section 15.3 determine whether this Plan is a Primary Plan or Secondary Plan as to
another plan covering a Participant or Dependent.






	 	(i)	 	“Primary Plan” means a plan the benefits of which are
determined before those of the other plan and without considering the other
plan’s benefits.
	 
	 	(ii)	 	“Secondary Plan” means a plan the benefits of which are
determined after those of the other plan and may be reduced because of the
other plan’s benefits. When there are more than two plans covering the
Participant or Dependent covered under this Plan, this Plan may be a Primary
Plan as to
one or more other plans, and may be a Secondary Plan as to a different plan
or plans.




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	 	(c)	 	Allowable Expense. “Allowable Expense” means any necessary, reasonable
and customary charge or Covered Medical Expense or Covered Drug Expense which the
Participant or Dependent is legally required to pay for an item of necessary medical or
dental or prescription drug expense at least a portion of which is covered under at
least one of the plans covering the person for whom claim is made. If benefits are
provided in the form of services rather than cash payments, the reasonable cash value
of each service rendered shall be considered both an allowable expense and a benefit
paid. In no event, however, will “Allowable Expense” include expenses for services
received because of any injury arising out of or in the course of any employment for
wage or profit or any sickness entitling the person for whom claim is made to benefits
under any workers’ compensation or occupational disease law. The difference between
the cost of a private hospital room and the cost of a semi-private hospital room is not
considered an allowable expense under the above definition unless the patient’s stay in
a private hospital room is medically necessary either in terms of generally accepted
medical practice, or as specifically defined in the Plan. When benefits are reduced
under a Primary Plan because a covered person does not comply with the plan provisions,
the amount of such reduction will not be considered an allowable expense. Examples of
such provisions are those related to second surgical opinions, pre-certification of
admissions or services.
	 
	 	(d)	 	Claim Determination Period. “Claim determination period” means a
period beginning with any January 1 and ending with the next following December 31. In
no event will a claim determination period for any person include any part of a year
during which such person is not covered under this Plan.






	15.2	 	Coordination of Benefits. This Section applies when, in accordance with 15.3, this Plan is a Secondary Plan as to
one or more other plans. This Plan is not a Secondary Plan to Medicare Part D.






	 	(a)	 	As to any claim determination period with respect to which this Section is
applicable, the benefits that would be payable under this Plan in the absence of this
provision for the Allowable Expenses incurred as to a Participant or covered




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	 	 	 	Dependent
during such claim determination period shall be reduced to the extent necessary so that
the sum of such reduced benefits and all the benefits payable for such Allowable
Expenses under all other plans, except as provided in subparagraph (b) below, shall not
exceed the total of such Allowable Expenses. Allowable Expenses under another plan
include the benefits that would have been payable had a claim been duly made therefore.
Any person claiming benefits under the Plan shall furnish the Administrative Services
Provider with such information as may be necessary for purposes of this provision.
	 
	 	(b)	 	When there is a basis for a claim under this Plan and another plan, this Plan
is a Secondary Plan which has its benefits determined after those of the other plan,
unless the other plan contains a provision coordinating its benefits with those of this
Plan, and both the rules of that plan and the rules set forth in Section 15.3 would
require this Plan to determine its benefits before such other plan. In that case, the
benefits of such other plan will be ignored for the purposes of determining the
benefits under this Plan.
	 
	 	(c)	 	When the benefits of this Plan are reduced as described above, each benefit is
reduced in proportion. It is then charged against any applicable benefit limit of this
Plan.






	15.3	 	Order of Benefit Determination. For the purposes of this Section 15, the rules establishing
the order of benefit determination are:






	 	(a)	 	Non-Dependent/Dependent. The benefits of a plan which covers the
person on whose expense a claim is based other than as a dependent shall be determined
before the benefits of a plan which covers such person as a dependent; except that:






	 	(i)	 	if the person is also a Medicare beneficiary, and
	 
	 	(ii)	 	if the rule established by the Social Security Act of 1965 as
amended makes Medicare secondary to the plan covering the person as a dependent
of an active employee, then




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	 	(iii)	 	the order of benefit determination shall be:






	 	(A)	 	Benefits of the plan of an active worker
covering the person as a dependent;
	 
	 	(B)	 	Medicare;
	 
	 	(C)	 	Benefits of plan covering the person other than
as a dependent.






	 	(b)	 	Dependent Child/Parents not Separated or Divorced. Except as stated in
Section 15.3(c) below, when this Plan and another plan cover the same child as a
dependent of different persons, called “parents”:






	 	(i)	 	The benefits of the plan of the parent whose birthday falls
earlier in a year are determined before those of the plan of the parent whose
birthday falls later in that year; but
	 
	 	(ii)	 	If both parents have the same birthday, the benefits of the
plan which covered one parent longer are determined before those of the plan
which covered the other parent for a shorter period of time.
	 
	 	(iii)	 	However, if the other plan does not have the rule described in
(i) immediately above, but instead has a rule based upon the gender of the
parent, and if, as a result, the plans do not agree on the order of benefit
determination, the rule in the other plan will determine the order of
benefit determination.






	 	(c)	 	Dependent Child/Separated or Divorced. If two or more plans cover a
person as a dependent child of divorced or separated parents, benefits for the child
are determined in this order:






	 	(i)	 	First, the plan of the parent with custody of the child;
	 
	 	(ii)	 	Then, the plan of the spouse of the parent with custody of the
child; and




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	 	(iii)	 	Finally, the plan of the parent not having custody of the
child.
	 
	 	(iv)	 	However, if the specific terms of a court decree state that one
of the parents is responsible for the health care expense of the child, and the
entity obligated to pay or provide the benefits of the plan of that parent has
actual knowledge of those terms, the benefits of that plan are determined
first. The plan of the other parent shall be the Secondary Plan. This
paragraph does not apply with respect to any Claim Determination Period or Plan
Year during which any benefits are actually paid or provided before the entity
has actual knowledge of the court decree.
	 
	 	(v)	 	Joint Custody. If the specific terms of a court decree
state that the parents shall share joint custody, without stating that one of
the parents is responsible for the health care expenses of the child, the plans
covering the child shall follow the order of benefit determination rules
outlined in Section 15.3(b).






	 	(d)	 	Active/Inactive Employee. The benefits of a plan which covers a person
as an employee or as a dependent of an employee who is neither laid off nor retired are
determined before those of a plan which covers that person as a laid off or retired
employee or as a dependent of a laid off or retired employee, unless the other plan
does not have this rule and as a result the plans do not agree on the order of
benefits, in which case this rule is ignored.
	 
	 	(e)	 	Length of Coverage. When paragraphs (a), (b), (c) and (d) of this
Section do not establish an order of benefit determination, the benefits of a plan
which has covered the person on whose expenses claim is based for the longer period of
time shall be determined before the benefits of a plan which has covered such person
the shorter period of time.
	 
	 	(f)	 	Medicare. Notwithstanding anything to the contrary, Medicare benefits
shall be determined before those of this Plan to the extent permitted by law for
(i) Medicare Eligible Participants and (ii) Participants or covered Dependents who
become eligible after Retirement but before age 65 for benefits under Medicare solely
as a result of disability.




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	 	 	 	If a Participant or covered Dependent has enrolled in a Medicare Part D Plan, this
Plan will not provide benefits as either a Primary Plan or a Secondary Plan with
respect to prescription drug benefits.






	15.4	 	Right to Receive and Release Necessary Information. For the purpose of this provision the
Administrative Services Provider may, without the consent of or notice to any person, release
or obtain information regarding coverage, expenses, and benefits which the Administrative
Services Provider considers necessary, subject to the requirements of HIPAA. Each person
claiming benefits under this Plan must provide to the Administrative Services Provider any
facts it needs to pay the claim.
	 
	15.5	 	Underpayments and Overpayments. If payments which should have been made under the Plan have
been made under any other plans, the Administrative Services Provider shall have the right,
exercisable alone and in its sole discretion, to pay over to any organization making such
other payments any amounts it shall determine to be warranted in order to satisfy the intent
of this provision,
and amounts so paid shall be deemed to be benefits paid under the Plan and, to the extent of
such payments, the Administrative Services Provider and the Employer shall be fully
discharged from liability under the Plan. If the amount of the payments made under this
Plan is more than it should have been, the Administrative Services Provider may recover the
excess from one or more of:







	 	(a)	 	The persons it has paid or for whom it has paid, as provided in Section 11.3;
	 
	 	(b)	 	Insurance companies; or
	 
	 	(c)	 	Other organizations.






	 	 	The “amount of payments made” includes the reasonable cash value of any benefits provided in
the form of services.






	15.6	 	Subrogation.




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	 	(a)	 	In the event and to the extent of any payment under this Plan, the Plan shall
(1) be subrogated to all the rights of recovery of a Participant or Dependent against
any person or entity, and (2) in the case of awards, settlements, judgments, or other
payments by a third party to a Participant or Dependent, be entitled to “first dollar”
priority reimbursement in full from such Participant or Dependent (without reduction
for the Participant’s or Dependent’s attorneys’ fees or costs, and without regard for
whether the Participant or Dependent is made whole), and the Participant or Dependent
shall execute and deliver instruments and papers and do whatsoever else is necessary to
secure such rights. Neither the Participant nor the Dependent shall do anything after
a loss to prejudice such rights. Receipt of benefits hereunder shall be deemed a
Participant’s or Dependent’s assignment of his rights to the Plan (to the extent of
such payment) and consent to the Plan’s subrogation and reimbursement rights, and no
further written consent by a Participant or Dependent shall be required. Any payments
received by a Participant, Dependent, his attorney, or his assigns, legal
representatives, or beneficiaries shall be held in constructive trust for the benefit
of the Plan, to the extent of the Plan’s payments. The Plan may also offset any future
payments that
would otherwise be payable to or on behalf of the Participant or any of his or her
Dependents (whether or not related to the injury or illness in question) against any
such reimbursement rights.
	 
	 	 	 	The Plan’s subrogation and reimbursement rights apply against all Participants and
Dependents, as well as against the beneficiaries, heirs, guardians, legal
representatives, assignees, and estates of such persons. It applies to minor
children or other minor or disabled Dependents, and to the family members or any
other beneficiary under any wrongful death or survivorship statute. The Plan’s
rights of recovery are valid against any legally responsible third party, including
the negligent or wrongful person or entity, his, hers or its insurance company, and
the Participant’s or Dependent’s insurance company. The Plan shall have an
automatic first priority lien against any such third party to the extent of his,
hers




 - 74 - 









 












	 	 	 	or its payments or obligations for the same, and may file any writing
describing the Plan’s rights with any such third party as a
notice of such lien.
	 
	 	(b)	 	The Plan has the absolute right to condition any payment on the Participant,
Dependent or other relevant party signing a legally enforceable
subrogation/reimbursement agreement containing language acceptable to the Plan. Absent
such a signed reimbursement agreement, no benefits are payable hereunder. Moreover, if
requested in writing by the Plan Administrator, the Participant or Dependent shall
take, through any representative designated by the Plan Administrator, such further
action as may be necessary or appropriate to recover any Plan payments as damages or
otherwise from any person or entity, said action to be taken in the name of the
Participant or Dependent. In the event of a recovery or settlement, the Plan shall
also be reimbursed out of such recovery or settlement for expenses, costs and
attorneys’ fees incurred by it in connection therewith.
	 
	 	(c)	 	The Plan shall be entitled, to the extent of any payments made to a Participant
or Dependent, to the proceeds of any settlement or judgment or other payment that may
result from the exercise of any rights of recovery of a Participant or
Dependent against any person or entity legally responsible for the injury, sickness
or condition for which such payment was made, or against any other person or entity,
including the Participant’s or Dependent’s own insurance company. The right is
hereby given the Plan to receive from any third party(ies), attorney(s), or
insurance company(ies) an amount equal to the amount paid to or on behalf of the
Participant or Dependent by the Plan, up to 100% of such third party recovery.
	 
	 	(d)	 	As part of the Plan’s subrogation and reimbursement rights, any recovery from a
third party will be applied first to reimburse the Plan (or discharge its
obligation for future payments), even if the Participant or Dependent is not paid for
all of his claims for damages against the third party, and even if the payment received
is for, or is described as being for, damages other than the benefits paid or covered
by the Plan. Thus, any award, settlement, judgment, or other payment will be




 - 75 - 









 












	 	 	 	automatically deemed to first cover health care expenses previously paid (or otherwise
covered) by the Plan, and will not be allocated to or designated as reimbursement for
any other costs or damages the Participant or Dependent may have incurred (including
attorneys’ fees incurred in obtaining such recovery), until the Plan is reimbursed in
full or otherwise made whole. There shall be no offset for the Participant’s or
Dependent’s legal fees unless expressly agreed to in writing by the Plan Administrator.
	 
	 	(e)	 	In the event a Participant or Dependent fails to reimburse the Plan as provided
by this Section 15.6, the Plan Administrator may offset future benefits (whether or not
payable with respect to the injury or illness giving rise to the third party recovery)
to the extent of such Participant’s or Dependent’s failure to reimburse the Plan.




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SECTION 16

AMENDMENT AND TERMINATION





	16.1	 	Limit on Right to Amend.






	 	(a)	 	Except as expressly provided below in Section 16.2, this Plan may not be
terminated or amended in any way that would materially and adversely affect the
benefits or costs of any Retired Employee in Groups IA, IB, IIA, IIIA, IIIB, or IV or
the Surviving Spouse or covered Dependent of such Retired Employee;
	 
	 	(b)	 	Except as expressly provided below in Section 16.2, this Plan may not be
terminated or amended prior to January 1, 2007 in any way that would materially and
adversely affect the benefits or costs of any Participants who are members of Groups
IIB or V; and
	 
	 	(c)	 	Except as expressly provided below in Section 16.2, the Plan may not be
terminated or amended in any way that would materially and adversely affect the
benefits or costs of any Retired Employees who are members of Groups IIB or V prior to
the earlier of the (i) time the Retired Employee becomes a Medicare Eligible
Participant or (ii) October 31, 2016.
	 
	 	(d)	 	The purpose of this Section 16.1 is to preserve, for the particular Retired
Employees, Surviving Spouses and Dependents and time periods set forth in subparagraph
(a) and (b) hereof, the substance of the benefit and cost structure established in the
Forsberg Settlement. Thus in determining whether an amendment “materially and
adversely” affects the benefits or costs of any such Participant or Dependent referred
to in Section 16.1, such amendment shall be considered together with all previous
amendments adopted after the effective date of this Plan; if the cumulative effect of
all such amendments is material and adverse, then the amendment being considered
materially and adversely affects the benefits of such Participant or Dependent.
Conversely, if after the effective date of this Plan it is amended to add additional
benefits or to reduce the costs of the Participant or Dependent, such additional
benefits or cost reductions may be





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	 	 	 	eliminated or reduced by subsequent amendments without materially and adversely
affecting the benefits or costs of the Participant or Dependent.
	 
	 	(e)	 	The Company maintains the right without limitation to amend the Plan with
respect to any Retired Employee in Group VI or the Surviving Spouse or covered
Dependent of such Retired Employee.






	16.2	 	Permitted Amendments. The Company reserves the right to adopt and implement any amendment to
this Plan not prohibited by Section 16.1. Notwithstanding Section 16.1, the Company also
reserves the right to adopt and implement any amendment to this Plan that is expressly
permitted by subparagraphs (a) through (e) of this Section 16.2; provided, however, that no
such amendment may be adopted and implemented if such amendment is unfair to the Participants,
except as discussed in Section 16.6.






	 	(a)	 	The Company may amend the Plan to provide for changes regarding the delivery of
benefits, including without limitations the adoption of Supplements to the Plan which
provide for the addition of managed care features (whether through a Preferred Provider
Organization, a Point of Service network of providers or otherwise) provided such
changes either (i) apply to a Participant only upon the voluntary election or action of
the Participant, or (ii) provide for a higher level of benefits than the Plan would
otherwise provide.
	 
	 	(b)	 	The Company may amend the Plan to avoid an increase in benefits or costs, which
could or would, in the Company’s reasonable determination, be otherwise required by
applicable law.
	 
	 	(c)	 	The Company may amend the Plan as regards administrative or procedural matters
(e.g., Firestone language, appeals procedures).
	 
	 	(d)	 	The Company may amend the Plan in response to legislative changes that affect
the legality of the Plan, the cost of providing any benefit under the Plan, or the
deductibility of those costs, or require any additional benefit to be provided under
the Plan.




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	 	(e)	 	The Company may modify prescription drug coverage for Medicare Eligible
Participants at any time in its discretion in order to coordinate with or avoid
duplication of any Medicare or other government provided coverage.






	16.3	 	Resolution of Disputes With Retiree Liaison Committee. If a Retiree Liaison Committee has
been appointed and is in existence, the Company shall give the Retiree Liaison Committee
reasonable notice of any proposed amendment with respect to Groups IA, IB, IIA, IIB, IIIA,
IIIB, IV and V. If the Retiree Liaison Committee objects to a proposed amendment on the
ground that it is not permitted by the terms of this Plan, it shall notify the Company of its
objections. The Company and the Retiree Liaison Committee shall use their best efforts to
negotiate in good faith to resolve any objections to a proposed amendment.
	 
	 	 	The Retiree Liaison Committee shall have no obligation to any Participants to challenge the
validity of any proposed amendment, and the right of a Participant to challenge, through the
claims procedures of the Plan and, if applicable, litigation, the validity of any amendment
shall not be in any way impaired or diminished by any failure of the Retiree Liaison
Committee to challenge any such amendment. Any such litigation by a Participant raising the
issue of whether an amendment to this Plan is permitted by this Plan can be brought only in
the United States District Court for the Eastern District of Missouri.
	 
	 	 	The Company need not defer or delay the adoption or implementation of any amendment because
of the pendency of a dispute with the Retiree Liaison Committee or litigation with a
Participant. If the Company adopts and implements an amendment that is subsequently
determined to be invalid, the Company will take whatever action may be reasonably required
to eliminate the effects of having implemented the amendment.
	 
	16.4	 	Right to Amend or Terminate the Plan. The Company has the absolute right to amend or terminate this Plan at any time as to any
Retired Employee in Group VI, as to any Surviving Spouse of such a Retired Employee and as
to any covered Dependent of such a Retired Employee. The Company has the absolute right to
amend or terminate this Plan as it applies on or after January 1, 2007 to any member of
Groups IIB and V except as to a Participant or covered Dependent Spouse who is not then a
Medicare Eligible Participant. The Company also has the absolute right to amend or
terminate this Plan




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	 	 	as it applies to any member of Groups IIB and V after January 1, 2007 on
or after the earlier of (i) the date a Participant or covered Dependent Spouse becomes a
Medicare Eligible Participant or (ii) October 31, 2016. The Company also has the absolute
right to amend or terminate this Plan as to any Dependent child of a Retired Employee on or
after the later of (i) the date the Company could amend or terminate this Plan as to such
Retired Employee, or (ii) the date the Company could amend or terminate the Plan as to such
Retired Employee’s covered Dependent Spouse. Oral or written statements shall not change
the terms of this Plan.
	 
	16.5	 	No Informal Amendments. Absent an express delegation of authority from the Board of
Directors or the Employee Benefits Plans Committee of the Company, no one has the authority to
commit the Company or any Employer to any benefit or benefit provision not provided for under
the Plan or to change the eligibility criteria or other provisions of the Plan.
	 
	16.6	 	Active Plan Amendments. Nothing in Section 16.1 shall limit in any way the Company’s ability
to amend any Active Plan, provided that such change affects the benefits of a Retired
Employee, Surviving Spouse or covered Dependent under this Plan and similarly situated
participants in the Active Plan to substantially the same extent, regardless of whether such
amendment may materially and adversely affect the benefits of a Retired Employee, Surviving
Spouse or covered Dependent referred to in Section 16.1.




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SECTION 17

PLAN ADMINISTRATOR





	17.1	 	Administrator. The Plan Administrator shall be the Employee Benefits Plans Committee of the
Company (the “EBPC”). The EBPC shall be a “Named Fiduciary” for purposes of Section 402(a)(1)
of ERISA.
	 
	17.2	 	Duties and Powers. The Plan Administrator shall have the duty and power to determine whether
a Retired Employee, Surviving Spouse or Dependent is entitled to any benefit under the Plan
and to administer the Plan in all its details. The Plan Administrator’s duties and powers
shall include the following:






	 	(a)	 	to determine all questions arising under the Plan, including the power to
determine the rights or eligibility of Retired Employees or Participants and any other
persons, and the amounts of their contributions or benefits under the Plan, to
interpret the Plan, and to remedy ambiguities, inconsistencies or omissions;
	 
	 	(b)	 	to adopt such rules of procedure and regulations, including the establishment
of any claims procedure that may be required by law, as in its opinion may be necessary
for the proper and efficient administration of the Plan and as are consistent with the
Plan;
	 
	 	(c)	 	to adopt such forms and prepare such summaries and employee communications as
are necessary for the proper administration of the Plan;
	 
	 	(d)	 	to enforce the Plan in accordance with its terms and in accordance with the
rules and regulations adopted by the Plan Administrator as above;
	 
	 	(e)	 	to direct payments or distributions from the Plan in accordance with the
provisions of the Plan;
	 
	 	(f)	 	to select and employ the Administrative Services Provider and such agents,
attorneys, accountants or other persons (who also may be employed by the Company), and
allocate or delegate to them such powers, rights and duties as the Plan Administrator
may consider necessary or advisable to properly carry out the




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	 	 	 	administration of the
Plan, including any powers, rights and duties granted to the Plan Administrator herein
and specifically including without limitation the duty and power to determine
entitlement to benefits and to decide claims and appeals (and, in the case of any such
allocation or designation, any reference herein to the EBPC shall be deemed to refer to
such delegate); and
	 
	 	(g)	 	to file such reports and returns as may be required by law.






	17.3	 	Standard of Review. The Plan Administrator (or such other party to whom duties of
administration have been delegated, including without limitation, an Administrative Services
Provider) shall have the sole and absolute discretion to construe, interpret and apply the
Plan, to make all factual determinations, and to the extent permitted by law, make any and all
determinations of law. Benefits under this Plan will be paid only if the Plan Administrator
decides in its discretion that the claimant is entitled to them. Any review of a final
decision or action of the Plan Administrator (or other party referred to above) shall be based
only on such evidence presented to or considered by the Plan Administrator (or other party
referred to above) at the time it made the decision that is the subject of the review.
	 
	17.4	 	Limitation of Liability. If permissible by law, the Plan Administrator and each EBPC member
serves without bond. If the law requires bond, the Plan Administrator must secure the minimum
required and obtain necessary payments from the Company. The Plan Administrator or a member
of the EBPC is not liable for another EBPC member’s act or omission. To the extent allowed by
law and except as otherwise provided in the Plan, the Plan Administrator and
each EBPC member is not liable for any action or omission that is not the Plan
Administrator’s or member’s own gross negligence or willful misconduct. As permitted by law
and as limited by any agreement in writing between the Company and the Plan Administrator,
the Company must indemnify and save the Plan Administrator and each member of the EBPC
harmless against expenses, claims, and liabilities arising out of being the Plan
Administrator or a member of the EBPC, except expenses, claims and liability arising out of
the Plan Administrator’s or member’s own gross negligence or willful misconduct. The
Company may obtain




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	 	 	insurance against acts or omissions of the Plan Administrator or EBPC
members or, if the Company does not do so, the Plan Administrator or a EBPC member may
obtain insurance and must be reimbursed as permitted by law. At its own expense, the
Company may employ its own legal counsel to defend or maintain, either in its own name or in
the name of the Plan Administrator or any EBPC member, any suit or litigation arising under
this Plan concerning the Plan Administrator or any EBPC member.
	 
	17.5	 	Information Required by Administrative Services Provider. Each Employer shall furnish the
Administrative Services Provider with such data and information as the Administrative Services
Provider may deem necessary or desirable in order to administer the Plan. The records of an
Employer as to a Retired Employee’s or Participant’s period or periods of employment,
termination of employment and the reason therefore, leave of absence, and reemployment will be
conclusive on all persons unless determined by the Administrative Services Provider’s
satisfaction to be incorrect. Participants and covered Dependents also shall furnish the
Administrative Services Provider with such evidence, data or information as the Administrative
Services Provider considers necessary or desirable to administer the Plan.






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SECTION 18

HEALTH MAINTENANCE ORGANIZATIONS



Each Retired Employee who is a member of a Health Maintenance Organization at retirement and who
elects to continue to participate in a Health Maintenance Organization to which the Employer
contributes or otherwise makes available to Retired Employees shall be excluded from eligibility
for medical coverage hereunder on account of the Retired Employee and his or her covered
Dependents.



Each Surviving Spouse who is a member of a Health Maintenance Organization at the date of death of
the spouse of such Surviving Spouse and who elects to continue to participate in a Health
Maintenance Organization to which the Employer contributes or otherwise makes available to
Surviving Spouses shall be excluded from eligibility for medical coverage hereunder.



A Participant who elected under a Prior Plan to participate in a Health Maintenance Organization to
which the Employer contributes or otherwise makes available to Retired Employees shall also be
excluded from eligibility for medical coverage hereunder on account of the Participant and his or
her covered Dependents.



Each Retired Employee or Surviving Spouse who is participating in a Health Maintenance Organization
to which the Employer contributes or otherwise makes available to Retired Employees and Surviving
Spouses who ceases such participation because of relocation out of the Health Maintenance
Organization’s service area or because the Retired Employee or Surviving Spouse elects to become
covered hereunder during an Open Enrollment Period (as reported to the Administrative Services
Provider by the Employer) shall be eligible for medical coverage hereunder on the Retired
Employee’s own account, or the Surviving Spouse’s own account and on account of the Retired
Employee’s covered Dependents on the day immediately following the date the Retired Employee, the
Surviving Spouse and the Retired Employee’s covered Dependents cease to be eligible to receive
services under the Health Maintenance Organization.




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SECTION
19

MISCELLANEOUS





	19.1	 	Gender and Number. Where the context admits, words denoting the masculine gender shall
include the feminine and neuter genders, the singular shall include the plural, and the plural
shall include the singular.
	 
	19.2	 	Headings. The headings and sub-headings in the Plan are inserted for convenience and
reference only and are not to be used in construing this Plan or any provision hereof.
	 
	19.3	 	Governing Law. This Plan shall be governed by, construed, and interpreted in accordance with
the laws of the State of Missouri, determined without regard to its conflict of law rules, to
the extent such laws are not preempted by the laws of the United States. Nothing in this Plan
shall be construed to supersede any provision of state law that regulates insurance, except to
the extent that such law prevents the application of a requirement of Section 11.5 of the
Plan. A state law regulating insurance shall not be considered to prevent the application of
a requirement of Section 11.5 of the Plan merely because such state law establishes a review
procedure to evaluate and resolve disputes involving adverse benefit determinations under
group health plans so long as the review procedure is conducted by a person or entity other
than the insurer, the Plan, Plan fiduciaries, the employer or any employee or agent of any of
the foregoing. Any such state law procedures are not part of the full and fair review
required under Section 503 of ERISA. Claimants therefore need not exhaust such state law
procedures prior to bringing suit under Section 502 of ERISA.
	 
	19.4	 	Conflicts. If any provision of this Plan is, becomes or is deemed invalid, or unenforceable in any
jurisdiction, such provision shall be deemed amended to conform to applicable law so as to be
valid, legal and enforceable in such jurisdiction so deeming. The validity, legality and
enforceability of such provision shall not in any way be affected or impaired thereby in any
other jurisdiction; if such provision cannot be so amended without materially altering the
intention of the parties, it shall be stricken and the remainder of this Plan shall remain in
full force and effect.




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	19.5	 	Waiver. Any waiver by any Employer of any provision of the Plan setting forth a requirement
for eligibility, continued coverage, or payment of benefits in any particular case shall not
be construed to be a waiver of the provision for any other case or a modification or
nullification of the provision.
	 
	19.6	 	Service of Legal Process. The General Counsel of the Company shall be the agent for service
of legal process.
	 
	19.7	 	Supplements. To the extent expressly authorized in the provisions of this Plan, the Plan may
be modified by Supplements. Each such Supplement will specify a group of Retired Employees or
other persons to which it applies and will supersede the provisions of this Plan to the extent
necessary to eliminate any inconsistencies between this Plan and such Supplement.
	 
	19.8	 	Qualified Medical Child Support Orders. Notwithstanding anything contained in this Plan to
the contrary, benefits shall be provided under the Plan in accordance with the applicable
requirements of any “qualified medical child support order” as defined in ERISA Section 609.
The Plan Administrator shall determine the qualified status of medical child support orders
and administer coverage under such qualified orders in accordance with the Qualified Medical Child Support Order
Procedures established by the Plan Administrator. Further, to the extent provided under a
“qualified medical child support order,” the child shall be treated as a Dependent for all
purposes under the Plan.






	19.9	 	VEBA and Other Trusts. To the extent applicable, any benefits paid from a VEBA, other trust
sponsored by the Company, or any other Employer shall be treated as payments made under this
Plan and shall be credited against the Maximum Aggregate Benefit and all other limits under
the Plan and the Prior Plan.




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SECTION 20

HIPAA PRIVACY





	20.1	 	HIPAA Privacy. As required by the regulations promulgated by the U.S. Department of Heath
and Human Services (“HHS”) pursuant to the Health Insurance Portability and Accountability Act
of 1996 (“HIPAA”), this Section 20 shall govern the Plan’s use of “protected health
information” (as such term is defined in 45 C.F.R. §160.103 (“PHI”)). To the extent not
outsourced to Administrative Service Providers, the Plan will use and disclose PHI for
purposes related to health care treatment, payment for health care and health care operations.
The Plan reserves the right to access PHI for all other legally permitted purposes, including
the following:






	 	(a)	 	Determination of eligibility, coverage and cost sharing amounts (for example,
cost of a benefit, Plan maximums and co-payments as determined for an individual’s
claim);
	 
	 	(b)	 	Coordination of benefits;
	 
	 	(c)	 	Adjudication of health benefit claims (including appeals and other payment
disputes);
	 
	 	(d)	 	Subrogation of health benefit claims;
	 
	 	(e)	 	Establishing employee contributions;
	 
	 	(f)	 	Risk adjusting amounts due based on enrollee health status and demographic
characteristics;
	 
	 	(g)	 	Billing, collection activities and related health care data processing;
	 
	 	(h)	 	Claims management and related health care data processing, including auditing
payments, investigating and resolving payment disputes and responding to participant
inquiries about payments;
	 
	 	(i)	 	Obtaining payment under a contract for reinsurance (including stop-loss and
excess of loss insurance);




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	 	(j)	 	Medical necessity reviews or reviews of appropriateness of care or
justification of charges;
	 
	 	(k)	 	Utilization review, including pre-certification, preauthorization, concurrent
review and retrospective review;
	 
	 	(l)	 	Disclosure to consumer reporting agencies related to the collection of premiums
or reimbursements (the following PHI may be disclosed for payment purposes: name and
address, date of birth, Social Security number, payment history, account number and
name and address of the provider and/or health plan);
	 
	 	(m)	 	Reimbursement to the Plan;
	 
	 	(n)	 	Quality assessment;
	 
	 	(o)	 	Population-based activities relating to improving health or reducing health
care costs, protocol development, case management and care coordination, disease
management, contacting health care providers and patients with information about
treatment alternatives and related functions;
	 
	 	(p)	 	Rating provider and Plan performance, including accreditation, certification,
licensing or credentialing activities;
	 
	 	(q)	 	Underwriting, premium rating and other activities relating to the creation,
renewal or replacement of a contract health insurance or health benefits, and ceding
securing or placing a contract for reinsurance of risk relating to health care claims
(including stop-loss insurance and excess loss insurance);
	 
	 	(r)	 	Conducting or arranging for medical review, legal services and auditing
functions, including fraud and abuse detection and compliance programs;
	 
	 	(s)	 	Business planning and development, such as conducting cost-management and
planning-related analyses related to managing and operating the Plan, including
formulary development and administration, development or improvement of payment methods
or coverage policies;




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	 	(t)	 	Business management and general administrative activities of the Plan,
including, but not limited to:






	 	(i)	 	Management activities relating to the implementation of and
compliance with HIPAA’s administrative simplification requirements; or
	 
	 	(ii)	 	Customer service, including the provision of data analyses for
policyholders, plan sponsors or other customers;






	 	(A)	 	Resolution of internal grievances; and
	 
	 	(B)	 	Due diligence in connection with the sale or
transfer of assets to a potential successor in interest, if the
potential successor in interest is a “covered entity” under HIPAA or,
following completion of the sale or transfer, will become a covered
entity.






	20.2	 	PHI Nondisclosure. The Plan or a Health Maintenance Organization with respect to the Plan
(collectively referred to for purposes of this Section 20 as the “Plan”) may not disclose PHI
to the Employer or provide for or permit the disclosure of PHI to the Employer, except as set
forth below or as permitted or required by applicable law. This prohibition shall include the
prohibition on disclosing PHI to the Employer for the purpose of employment-related actions or
decisions or in connection with any other benefit or employee benefit plan of the Employer.
	 
	20.3	 	Permitted Disclosures. Notwithstanding Paragraph 20.1 above, the Plan may disclose PHI to the Employer in
connection with its plan administration duties when the Plan would otherwise be permitted or
required to disclose or use PHI pursuant to HIPAA, the regulations set forth in 45 C.F.R.
Parts 160 and 164 (the “Privacy Rules”) and/or other applicable law. In addition, the
following disclosures of PHI may be made:






	 	(a)	 	The Plan may disclose summary health information (as such term is defined in 45
C.F.R. Section 164.504(a)) to the Employer upon its request for the purpose of:





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	 	(i)	 	obtaining premium bids from health plans for providing health
insurance coverage for the Plan, or
	 
	 	(ii)	 	modifying, amending, or terminating the Plan, subject to
Section 16.






	 	(b)	 	The Plan may disclose protected health information on whether an individual is
participating in the Plan, or is enrolled in or has disenrolled from a provider network
offered under the Plan.






	20.4	 	Disclosure Requirements. The Plan may disclose PHI to the Employer if and only if such
disclosures are consistent with this Section 20 and the Employer certifies to the Plan that
the Employer agrees to the following:






	 	(a)	 	To implement administrative, physical, and technical safeguards that reasonably
and appropriately protect the confidentiality, integrity, and availability of the
electronic PHI that the Employer creates, receives, maintains, or transmits on behalf
of the Plan;
	 
	 	(b)	 	Not to use or further disclose the information other than as permitted or
required by law and as permitted by authorization of the Participant;
	 
	 	(c)	 	Ensure that any agents, including a subcontractor, to whom it provides PHI
received from the Plan agree to the same restrictions and conditions that apply to the Employer with respect to such information, including implementation of
reasonable and appropriate security measures to protect electronic PHI;
	 
	 	(d)	 	Not to use or disclose the information for employment-related actions and
decisions or in connection with any other benefit or employee benefit plan of the
Employer unless authorized by the Participant;
	 
	 	(e)	 	Report to the Plan any use or disclosure of the information that is
inconsistent with the uses or disclosures provided for herein of which it becomes
aware, and any security incident of which it becomes aware;





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	 	(f)	 	Make available PHI in accordance with individuals’ right of access as described
in 45 C.F.R. section 164.524;
	 
	 	(g)	 	Make available PHI for amendment and incorporate any amendments to PHI in
accordance with 45 C.F.R. section 164.526;
	 
	 	(h)	 	Make available the information required to provide an accounting of disclosures
in accordance with 45 C.F.R. section 164.528;
	 
	 	(i)	 	Make the Employer’s internal practices, books, and records relating to the use
and disclosure of PHI received from the Plan available to the HHS Secretary for
purposes of determining compliance by the Plan with this Article;
	 
	 	(j)	 	If feasible, return or destroy all PHI received from the Plan that the Employer
still maintains in any form and retain no copies of such information when no longer
needed for the purpose for which disclosure was made, except that, if such return or
destruction is not feasible, limit further uses and disclosures to those purposes that
make the return or destruction of the information infeasible; and
	 
	 	(k)	 	Ensure that the adequate separation required pursuant to Paragraph 20.5 below
is established and that such separation is supported by reasonable and appropriate
security measures with respect to electronic PHI.






	20.5	 	Adequate Separation. Access to PHI shall be limited to those employees of the Employer who
may be assigned from time to time to coordinate the administration of the Plan, including, but
not limited to, the members of the EBPC, the Human Resources Vice President, the Privacy
Officer, the Benefits and HRIS Manager, the Benefits Analyst, the Human Resources
Manager/Lead/Director, and the Human Resources Generalist/Specialist, and each of their
counsels, consultants, accountants, and actuaries. The access to and use of PHI by such
individuals shall be limited to the plan administration function performed by the Employer and
its agents. The Employer shall resolve any issues of non-compliance with this Article
consistent with the Privacy Rules,




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	 	 	including subjecting the offending party to disciplinary
action and/or sanctions (including, without limitation, termination of employment).





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