ex10h.htm


    
      Exhibit
10-h

    

    
      


    

    
      


    

    
      


    

    
      


    

    
      


    

    
      


    

    
      


    

    
      


    

    
      


    

    
      


    

    
      


    

    
      


    

    
      


    

    
      


    

    
      


    

    
      


    

    
      


    

    
      


    

    
      


    

    
      


    

    
      AT&T
HEALTH PLAN

    

    
      


    

    
      


    

    


    


    


    


    


    


    


    


    


    


    


    


    


    


    


    


    


    


    


    


    


    Effective:  January
1, 1987

    
                 Revisions
Effective:  January 1, 2009

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    
 

    
      AT&T
HEALTH PLAN

    

    
      


    

    
      


    

    ARTICLE
1   PURPOSE

    
      The
AT&T Health Plan ("Plan") provides Eligible Employees, certain Retired
Eligible Employees, and each of their Dependents with supplemental medical,
dental, and vision benefits.  

    

    
      


    

    ARTICLE
2   DEFINITIONS

    
      For
purposes of this Plan, the following words and phrases shall have the meanings
indicated, unless the context clearly indicates otherwise:

    

    
      


    

    2.1 Basic
Plan(s). “Basic Plan(s)” shall mean AT&T’s group managed care medical
(known as the AT&T Medical Plan), dental (non-DHMO option), and vision
care plans (including the AT&T Retiree Vision Care
Program).   For a Participant who Retired on or before August 31,
1992, Basic Plans shall mean the AT&T Medical and Group Life Insurance
Plan–CustomCare (“CustomCare”) and dental (non-DHMO option) plans.

    


    2.2 CEO.  "CEO"
shall mean the Chief Executive Officer of AT&T Inc.

    


    2.3 COBRA.  “COBRA”
shall mean the Consolidated Omnibus Budget Reconciliation Act of 1985, as
amended.

    


    2.4 Committee.  "Committee"
shall mean the Human Resources Committee of the Board of Directors of AT&T
Inc.

    


    2.5 Dependent(s).  “Dependent(s)”
shall mean those individuals who would qualify as an Eligible Employee’s
dependent(s) under the terms of the major medical Basic Plan in which the
Eligible Employee participates, or, if applicable, Substitute Basic
Coverage.

    


    2.6 Disability.  "Disability"
shall mean qualification for long term disability benefits under Section 3.1 of
the Officer Disability Plan.

    


    2.7 Eligible
Employee.  "Eligible Employee" shall mean an
Officer.  Notwithstanding the foregoing, the CEO may, from time to
time, exclude any Officer or group of Officers from being an “Eligible Employee”
under this Plan.  Employees of a company acquired by AT&T shall
not be considered an Eligible Employee unless designated as such by the
CEO.

    


    2.8 Employer.  "Employer"
shall mean AT&T Inc. or any of its Subsidiaries.

    


    2.9 Executive
Officer.  “Executive Officer” shall mean any executive officer
of AT&T, as that term is used under the Securities Exchange Act of
1934.

    


    2.10 Officer.  "Officer"
shall mean an individual who is designated as an officer level Employee for
compensation purposes on the records of AT&T.

    


    2.11 Participant.  “Participant”
shall mean an Eligible Employee or Retired Eligible Employee who has been
designated to participate in the Plan and his/ her Dependent(s).

    


    2.12 Plan
Year.  ”Plan
Year” shall mean the calendar year.

    


    2.13 Qualified
Dependent.  “Qualified Dependent” shall mean a Dependent who
loses coverage under a COBRA Eligible Program due to a Qualifying
Event.

    


    2.14 Qualifying
Event. “Qualifying Event” shall
mean any of the following events if, but for COBRA continuation coverage, they
would result in a Participant’s loss of coverage under this Plan:

    
      


    

    
      
        	
                (1)

              	
                death
      of a covered Employee;

              


      

    

    
      
        	
                (2)

              	
                termination
      (other than by reason of such Employee’s gross  misconduct) of
      an Employee’s employment;

              


      

    

    
      
        	
                (3)

              	
                reduction
      in hours of an Employee;

              


      

    

    
      
        	
                (4)

              	
                divorce
      or legal separation of an Employee or dissolution of an Employee’s
      registered domestic
partnership;

              


      

    

    
      
        	
                (5)

              	
                an
      Employee’s entitlement to Medicare benefits;
or

              


      

    

    
      
        	
                (6)

              	
                a
      Dependent child ceasing to qualify as a Dependent under a
      Program.

              


      

    

    
      


    

    2.15 Retire or
Retirement.  “Retire” or "Retirement" shall mean the
termination of an Eligible Employee's employment with AT&T or any of its
Subsidiaries, for reasons other than death, on or after the earlier of the
following dates:  (1) the date such Eligible Employee has attained age
55, and, for an Eligible Employee on or after January 1, 2002, has five (5)
years of service, or (2) the date the Eligible Employee has attained one of the
following combinations of age and service at termination of employment on or
after April 1, 1997: 

    
       

      


       

      
        	Net Credited Service	
                Age 

              
	   25
      years or more	50
      or older 
	   30
      years or more	Any
    age 


      

    

    


    2.16  SEVP-HR.    “SEVP-HR”
shall mean AT&T’s highest ranking Officer, specifically responsible for
human resources matters.

    


    2.17 Subsidiary.  "Subsidiary"
shall mean any corporation, partnership, venture or other entity in which
AT&T holds, directly or indirectly, a 50% or greater ownership
interest.  The Committee may, at its sole discretion, designate any
other corporation, partnership, venture or other entity a Subsidiary for the
purpose of participating in this Plan.  Notwithstanding anything
herein to the contrary, unless designated a “Subsidiary” pursuant to the
immediately preceding sentence, Cingular Wireless LLC, Sterling Commerce, Inc.,
and their respective subsidiaries shall not be considered a Subsidiary under
this Plan.

    


    2.18 AT&T.  "AT&T"
shall mean AT&T Inc.

    


    ARTICLE
3   ELIGIBILITY

    


    3.1 Active
Participants and their Dependents. Each Eligible Employee
shall be eligible to participate in this Plan along with his/her Dependent(s)
beginning on the effective date of the employee becoming an Eligible
Employee.

    


    
      Upon
becoming an Eligible Employee, he/she shall have 90 days to elect to participate
in this Plan.  In order to continue participation, the Eligible
Employee must pay all applicable contributions.  If an Eligible
Employee terminates participation in this Plan at any time for any reason, that
Eligible Employee and his/her Dependent(s) shall be ineligible to participate in
the Plan at any time in the future.

    

    
      


    

    3.2 Retired
Participants and their Dependents.  Provisions of
this Plan will continue in effect during Retirement for each Eligible Employee
and his/her Dependent(s) with respect to any Eligible Employee who became a
Participant before January 1, 1999.  Neither an Eligible Employee who
became an Eligible Employee after December 31, 1998 nor his/her Dependent(s)
shall be eligible for participation hereunder on or after such Eligible
Employee’s Retirement.

    


    3.3 Requirement
to Enroll and Participate in Basic Plans and Medicare.  As a condition to
participation in the Plan, each Participant must be enrolled in, paying for, and
participating in (i) the Basic Plans, or, if applicable, Substitute Basic
Coverage, and (ii) all parts of Medicare for which such Participant is eligible
and for which Medicare would be primary if enrolled therein, except for Medicare
Part D relating to prescription drug coverage.

    


    
      Notwithstanding
any other provision of the Plan to the contrary, an individual who first becomes
an Eligible Employee in the middle of a Plan Year and who is enrolled in
AT&T sponsored group health plans other than the Basic Plans, will be
allowed to participate in the Plan for the remainder of the Plan Year along with
his/her Dependent(s) who are enrolled in such other AT&T sponsored health
plans, as if they were participating in the Basic Plans.  At the next
group enrollment opportunity for the Basic Plans, the Eligible Employee and
his/her Dependent(s) must enroll in the Basic Plans to continue participation in
this Plan.

    

    


    ARTICLE
4   BENEFITS

    


    4.1 Covered
Benefits. Subject to the limitations in this Article, this Plan provides
100% payment, through reimbursement or otherwise, of all medical, dental, and
vision services not paid under the Eligible Employee’s (i) Basic Plans or, if
applicable, Substitute Basic Coverage, or (ii) Medicare, provided expenses for
such services would qualify as deductible medical expenses for federal income
tax purposes, whether deducted or not. Contributions or premiums for
participation in this Plan, the Basic Plans, Medicare, or any other health plan
are not considered “services”, and are therefore not eligible benefits under
this Plan.

    


    4.2 Benefit
Limits.  Benefits paid to any Eligible Employee or any one of
his/her Dependents under this Plan shall not exceed $50,000 per Plan Year per
individual, and benefits paid to any Eligible Employee and his/her Dependents
under this Plan shall not exceed $100,000 total per Plan Year. Amounts paid to
or on behalf of an Eligible Employee or his/her Dependent(s) under (i) the Basic
Plans, or if applicable, Substitute Basic Coverage, (ii) Medicare, or (iii) any
other AT&T sponsored group health plan will not be included in these
limits.

    


    4.3 Priority
of Paying Covered Claims.  Claims for benefits will be applied
against the various health plans and coordinated with Medicare in the following
order:

     

    
      
        	
                (1)

              	
                Medicare,
      to the extent the Participant is eligible therefore and such claim is
      actually paid by Medicare,

              


      

    

    
      
        	
                (2)

              	
                Basic
      Plans,

              


      

    

    
      
        	
                (3)

              	
                CarePlus,
      if elected,

              


      

    

    
      
        	
                (4)

              	
                Long
      Term Care Plan, if elected,

              


      

    

    
      
        	
                (5)

              	
                this
      Plan.

              


      

    

    
      


    

    4.4 Substitute
Basic Coverage.  Notwithstanding any other provision of this
Plan to the contrary, if an Eligible Employee is eligible for participation
under this Plan during Retirement, but not eligible to participate under the
Basic Plans, the Plan shall provide medical, dental, and vision benefits for the
Eligible Employee and his/her Dependent(s) substantially equivalent to the
benefits under the Basic Plans through an insured product (hereinafter,
"Substitute Basic Coverage"). Eligibility for Substitute Basic Coverage is
conditioned upon the Eligible Employee’s payment of contributions in the same
amount that a similarly situated retired Basic Plan participant is required to
pay under the Basic Plans. Such Substitute Basic Coverage shall constitute such
Eligible Employee’s Basic Plans for all purposes under this Plan.  The
costs of Substitute Basic Coverage (except for the required monthly
contributions referenced in this paragraph) shall be borne by AT&T, and the
costs of Substitute Basic Coverage shall not be included in the determination of
any Participant’s annual Plan contribution amount as provided in Article
7.

    


    


    ARTICLE
5   TERMINATION OF PARTICIPATION

    


    5.1 Termination
of Participation.  Participation
will cease on the last day of the month in which one of the following conditions
occurs:

    


    
      
        
          	
                  (1)  

                	
                  The
      Participant is no longer a participant in the Basic Plans
      or Substitute Basic Coverage, in which case participation ceases for
      such Participant;

                


        

      

    

    
      


    

    
      
        
          	
                  (2)  

                	
                  A
      Participant eligible to enroll in Medicare is no longer a participant in
      all parts of Medicare for which such Participant is eligible to enroll and
      for which Medicare would be primary if enrolled therein, except for
      Medicare Part D relating to prescription drug coverage, in which case
      participation ceases for such
Participant;

                


        

      

    

    
      


    

    
      
        
          	
                  (3)  

                	
                  The
      Eligible Employee’s termination of employment for reasons other than
      Death, Disability, or Retirement, in which case participation ceases
      for the Eligible Employee and
  his/her Dependent(s);

                


        

      

    

    
      


    

    
      
        
          	
                  (4)  

                	
                  The
      demotion or designation of an Eligible Employee so as to no longer be
      eligible to participate in the Plan, in which case participation ceases
      for the Eligible employee and
  his/her Dependent(s);

                


        

      

    

    
      


    

    
      
        
          	
                  (5)  

                	
                  The
      Eligible Employee (or Retired Eligible Employee) engages
      in competitive activity under Article 8, in which case
      participation ceases for the Eligible Employee (or Retired Eligible
      Employee) and his/her Dependent(s);
or

                


        

      

    

    
      


    

    
      
        
          	
                  (6)  

                	
                  Discontinuance
      of the Plan by AT&T, or, with respect to a Subsidiary’s Eligible
      Employees (or Retired Eligible Employees), such Subsidiary’s failure to
      make the benefits hereunder available to Eligible Employees employed
      by it (or its Retired Eligible Employees), in which case
      participation ceases for the Eligible Employee (or Retired Eligible
      Employee) and
his/her Dependent(s).

                


        

      

    

    
      


    

    5.2 Dependents
Failure to Participate in Basic Plans.  If a Dependent ceases
participation under a Basic Plan or, if applicable, Substitute Basic Coverage,
such Dependent’s participation under this Plan will cease with the same
effective date.

    


    5.3 Death.  In
the event of the Eligible Employee’s (or Retired Eligible Employee’s) death, the
Eligible Employee’s (or Retired Eligible Employee’s) Dependents may continue
participation in this Plan as follows:

    


    
      	
               
      

            	
              (1)

            	
              In
      the event of the death of a Retired Eligible Employee such Retired
      Eligible Employee’s Dependents may continue participation in this
      Plan for so long as such Dependents are participating in the Basic
      Plans (or, if applicable, Substitute Basic Coverage) and are paying any
      applicable contributions for this Plan as provided in Article
      7.

            


    

    


    
      	
               
      

            	
              (2)

            	
              In
      the event of an in-service death of an Eligible Employee eligible to
      participate in the Plan in Retirement as provided under Article 3.2, such
      Eligible Employee’s surviving Dependents may
      continue participation in this Plan for so long as such Dependents
      are participating in the Basic Plans (or, if applicable Substitute
      Basic Coverage) and are paying any applicable contributions for
      this Plan as provided in Article 7.  If a surviving spouse
      of such Eligible Employee otherwise eligible for participation in the Plan
      remarries, his/her participation will cease with the effective date of
      his/ her marriage.

            


    

    


    
      	
               
      

            	
              (3)

            	
              In
      the event of an in-service death of an Eligible Employee not eligible to
      participate in the Plan in Retirement as provided in Article 3.2, such
      Eligible Employee’s Dependent(s) may continue participation in this Plan
      for a 12-month period commencing the month following the month in which
      such Eligible Employee dies as long as such Dependent(s) are participating
      in the Basic Plans and are paying any applicable contributions for this
      Plan as provided in Article 7.  If the Eligible Employee’s
      Dependent(s) are eligible for COBRA, they will automatically be enrolled
      in COBRA so that there is no lapse in coverage, and this 12-month coverage
      will be integrated and run concurrently with COBRA
    coverage.

            


    

    


    ARTICLE
6   DISABILITY

    


    6.1 Disability.  With
respect to any Eligible Employee who is receiving short term or long term
disability benefits under the Officer Disability Plan, participation under this
Plan will be as follows:

    


    
      
        
          	
                  (1)

                	
                  The
      Eligible Employee will be eligible to participate in this Plan for as long
      as he/she receives short term or long term disability benefits under the
      Officer Disability
Plan.

                


        

      

    

    
      


    

    
      
        
          	
                  (2)

                	
                  An
      individual who became an Eligible Employee on or after January
      1, 1999 will no longer be eligible to participate in this Plan once long
      term disability benefits under the Officer Disability Plan are
      discontinued, unless the Eligible Employee is otherwise eligible for
      continued benefits under this
Plan.

                


        

      

    

    
       

    

    
      
        
          	
                  (3)

                	
                  An
      Employee who became an Eligible Employee before January 1, 1999, will be
      eligible for participation in this Plan as
  follows:

                


        

      

    

    
      


    

    
      
        
          	
                  (a)

                	
                  If
      the individual is Retirement eligible at the time long term disability
      benefits under the Officer Disability Plan commence, he/she will be
      eligible to continue participation in this Plan on the same terms and
      conditions that participation would be available to such Eligible Employee
      in Retirement, regardless of his/her continued receipt of long term
      disability benefits.

                


        

      

    

    
       

      
        
          
            
              	
                      (b)

                    	
                            
                        If
      the individual is not Retirement eligible at the time long term disability
      benefits under the Officer Disability Plan commence, he/she will be
      eligible to participate in this Plan for as long as such Eligible Employee
      participates in the Basic
Plans.

                      

                    


            

          

        

        
           

           

        

      

    

    ARTICLE
7   COSTS

    


    7.1 Costs of
the Plan.  Except as provided below in this Article 7, costs
and expenses incurred in the operation and administration of this Plan will be
borne by AT&T, and each Subsidiary shall reimburse AT&T for applicable
costs and expenses attributable to Eligible Employees employed by it (and
Retired Eligible Employees formerly employed by it).

    


    7.2 Active
Participant
Contributions.  An Eligible Employee electing to participate in the
Plan will pay to participate in the Plan while in active service or while
receiving short term or long term disability benefits under the Officer
Disability Plan. The contribution for participation may change annually,
effective at the beginning of each Plan Year.  Contributions to be
made by Eligible Employees electing to participate in the Plan during active
service or while receiving short term or long term disability benefits under the
Disability Plan shall be set annually by the SEVP-HR, determined in the
SEVP-HR’s sole and absolute discretion.  The SEVP-HR may adopt tiered
rates for similarly situated groups of Eligible Employees based on factors such
as the number of Dependents covered or Medicare
eligibility.  Notwithstanding the foregoing, required contributions
for Executive Officers shall be approved by the Human Resources Committee of the
AT&T Inc. Board of Directors.

    


    7.3 Retired
Eligible Employees
Contributions.  Eligible Employees entitled to participate in
the Plan after Retirement or after termination of long term disability benefits
under the Officer Disability Plan who elect to participate will pay to
participate in the Plan. The contribution for participation may change annually,
effective at the beginning of each Plan Year.  Contributions to be made by
Eligible Employees entitled to participate in the Plan after Retirement or after
termination of long term disability benefits under the Officer Disability Plan
who elect to participate shall be set annually by the SEVP-HR (in his/her sole
and absolute discretion), to the extent their contributions have not previously
been provided for in a separate agreement.

    


    7.4 Survivor
Contributions.
 Upon the death of an Eligible Employee the contribution percentage
paid by the surviving spouse will be equal to the contribution, adjusted (if
applicable) for factors such as the number of Dependents or Medicare eligibility
that that would have been paid by the Participant had he/she
survived.  In the event there is no surviving spouse but there are
surviving eligible Dependents, such Dependents shall pay a ratable share of the
contribution, adjusted (if applicable) for factors such as the number of
Dependents or Medicare eligibility that would have been paid by the Participant
had he/she survived.

    
      


    

    
      


    

    
      In order
to continue participation, the Retired Eligible Employee or his/her Dependent(s)
must pay all applicable contributions.

    

    
      


    

    
      If a
Retired Eligible Employee terminates participation at any time for any reason,
participation of that Retired Eligible Employee and his/her Dependent(s) may not
be reinstated for any reason.

    

    


    ARTICLE
8   COVENANT NOT TO COMPETE

    


    Non-Competition.  Notwithstanding
any other provision of this Plan, no coverage shall be provided under this Plan
with respect to any Eligible Employee who shall, without the written consent of
AT&T, and while employed by AT&T or any Subsidiary thereof, or within
three (3) years after termination of employment from AT&T or any Subsidiary
thereof, engage in competition with AT&T or any Subsidiary thereof or with
any business with which a subsidiary of AT&T or an affiliated company has a
substantial interest (collectively referred to herein as "Employer
business").  For purposes of this Plan, engaging in competition with
any Employer business shall mean engaging by Eligible Employee in any business
or activity in the same geographical market where the same or substantially
similar business or activity is being carried on as an Employer
business.  Such term shall not include owning a nonsubstantial
publicly traded interest as a shareholder in a business that competes with an
Employer business.  However, engaging in competition with an Employer
business shall include representing or providing consulting services to, or
being an employee of, any person or entity that is engaged in competition with
any Employer business or that takes a position adverse to any Employer
business.  Accordingly, benefits shall not be provided under this Plan
if, within the time period and without the written consent specified, the
Eligible Employee either engages directly in competitive activity or in any
capacity in any location becomes employed by, associated with, or renders
service to any company, or parent or affiliate thereof, or any subsidiary of any
of them, if any of them is engaged in competition with an Employer business,
regardless of the position or duties the Eligible Employee takes and regardless
of whether or not the employing company, or the company that Eligible Employee
becomes associated with or renders service to, is itself engaged in direct
competition with an Employer business.

    


    ARTICLE
9  MISCELLANEOUS

    


    9.1 Administration.  Subject
to the terms of the Plan, the CEO or SEVP-HR shall establish such rules as are
deemed necessary for the proper administration of the Plan. AT&T will
compute a "gross-up" allowance which will be paid to an Eligible Employee to
offset any income tax liabilities incurred as a result of receiving benefits
under this Plan. 

    


    9.2 Amendments
and Termination.  This Plan may be modified or terminated at
any time in accordance with the provisions of AT&T's Schedule of
Authorizations.

    


    9.3 Newborns'
and Mothers' Health Protection Act of 1996.  To the extent this
Plan provides benefits for hospital lengths of stay in connection with
childbirth, the Plan will cover the minimum length of stay required for
deliveries (i.e., a 48-hour hospital stay after a vaginal delivery or a 96-hour
stay following a delivery by Cesarean section.)  The mother’s or
newborn’s attending physician, after consulting with the mother, may discharge
the mother or her newborn earlier than the minimum length of stay otherwise
required by law.  Such coverage shall be subject to all other
provisions of this Plan.

    


    9.4 Women's
Health and Cancer Rights Act of 1998.  To the extent this Plan
provides benefits for mastectomies, it will provide, for an individual who is
receiving benefits in connection with a mastectomy and who elects breast
reconstruction in connection with such mastectomy, coverage for reconstruction
on the breast on which the mastectomy was performed, surgery and reconstruction
on the other breast to give a symmetrical appearance, and prosthesis and
coverage for physical complications of all stages of the mastectomy, including
lymphedemas.  Such coverage shall be subject to all other provisions
of this Plan.

    


    9.5 Mental
Health Parity Act of 1996.  To the extent this Plan provides
mental health benefits other than treatment for substance or alcohol abuse, it
will not place annual or lifetime maximums for such benefits that are lower than
the annual and lifetime maximums for physical health benefits.  Such
coverage shall be subject to all other provisions of this Plan.

    


    9.6 Continuation
of Coverage During Family or Medical Leave.  During any period
which an Eligible Employee is on a family or medical leave as defined in the
Family or Medical Leave Act, any benefit elections in force for the Eligible
Employee shall remain in effect.  While the Eligible Employee is on
paid leave, contributions shall continue.  If the Eligible Employee is
on an unpaid leave, the Eligible Employee may elect to prepay required
contributions on a pre-tax basis before the commencement of such unpaid
leave.  Alternatively, the Eligible Employee may elect to make such
payments on an after-tax basis monthly in accordance with an arrangement that
the Plan Administrator shall provide.  If coverage is not continued
during the entire period of the family or medical leave because the Eligible
Employee declines to pay the premium, the coverage must be reinstated upon
reemployment with no exclusions or waiting periods, notwithstanding any other
provision of this Plan to the contrary. If the Eligible Employee does not return
to work upon completion of the leave, the Eligible Employee must pay the full
cost of any health care coverage that was continued on his/her behalf during the
leave.  These rules apply to the COBRA Eligible Programs.

    


    9.7 Rights
While on Military Leave.  Pursuant to the provisions of the
Uniformed Services Employment and Reemployment Rights Act of 1994, an Employee
on military leave will be considered to be on a Leave of Absence and will be
entitled during the leave to the health and welfare benefits that would be made
available to other similarly situated Employees if they were on a Leave of
Absence.  This entitlement will end if the Employee provides written
notice of intent not to return to work following the completion of the military
leave.  The Employee shall have the right to continue his/her
coverage, including any Dependent coverage, for the lesser of the length of the
leave or 18 months.  If the military leave is for a period of 31 days
or more, the Employee may be required to pay 102 percent of the total premium
(determined in the same manner as a COBRA continuation coverage
premium).  If coverage is not continued during the entire period of
the military leave because the Employee declines to pay the premium or the leave
extends beyond 18 months, the coverage must be reinstated upon reemployment with
no pre-existing condition exclusions (other than for service-related illnesses
or injuries) or waiting periods (other than those applicable to all eligible
Employees).

    


    9.8 Qualified
Medical Child Support Orders.  The Plan will comply with any
Qualified Medical Child Support Order issued by a court of competent
jurisdiction or administrative body that requires the Plan to provide medical
coverage to a Dependent child of an Eligible Employee.  The Plan
Administrator will establish reasonable procedures for determining whether a
court order or administrative decree requiring medical coverage for a Dependent
child meets the requirements for a Qualified Medical Child Support
Order.  The cost of coverage or any additional cost of such coverage,
if any, shall be borne by the Eligible Employee.

    


    9.9 Right of
Recovery.  If the Plan has
made an erroneous or excess payment to any Participant, the Plan Administrator
shall be entitled to recover such excess from the individual or entity to whom
such payments were made.  The recovery of such overpayment may be made
by offsetting the amount of any other benefit or amount payable by the amount of
the overpayment under the Plan.

    


    ARTICLE
10   COBRA

    


    10.1 Continuation
of Coverage Under COBRA.  Participants shall have all COBRA
continuation rights required by federal law and all conversion
rights.  COBRA continuation coverage shall be continued as provided in
this Article 10.

    


    10.2 COBRA
Continuation Coverage for Terminated Participants.  A covered
Participant may elect COBRA continuation coverage, at his/her own expense, if
his participation under this Plan would terminate as a result of one of the
following Qualifying Events: an Employee’s termination of employment or
reduction of hours with an Employer.

    


    10.3 COBRA
Continuation Coverage for Dependents.  A Qualified Dependent
may elect COBRA continuation coverage, at his/her own expense, if his/her
participation under this Plan would terminate as a result of a Qualifying
Event.

    


    10.4 Period of
Continuation Coverage for Covered Participants.  A covered
Participant who qualifies for COBRA continuation coverage as a result of an
Eligible Employee’s termination of employment or reduction in hours of
employment described in Subsection 10.2 may elect COBRA continuation coverage
for up to 18 months measured from the date of the Qualifying Event. 
Coverage
under this Subsection 10.4 may not continue beyond the:

    


    
      
        
          	
                  (1)  

                	
                  date
      on which the Participant’s Employer ceases to maintain this
      Plan;

                


        

      

    

    
      


    

    
      
        
          	
                  (2)  

                	
                  last
      day of the month for which premium payments have been made with respect to
      this Plan, if the individual fails to make premium payments on time, in
      accordance with Subsection
10.6;

                


        

      

    

    
      


    

    
      
        
          	
                  (3)  

                	
                  date
      the covered Participant becomes entitled to Medicare;
  or

                


        

      

    

    
      


    

    
      
        
          	
                  (4)  

                	
                  date
      the covered Participant is no longer subject to a pre-existing condition
      exclusion under the Participant's other coverage or new employer plan for
      the type of coverage available under the COBRA Eligible Program for which
      the COBRA election was
made.

                


        

      

    

    
      


    

    10.5 Period of
COBRA Continuation Coverage for Dependents.  If a Qualified
Dependent elects COBRA continuation coverage under a COBRA Eligible Program as a
result of the an Employee’s termination of employment as described in Subsection
10.2, continuation coverage may be continued for up to 18 months measured from
the date of the Qualifying Event.  COBRA continuation coverage for all
other Qualifying Events may continue for up to 36 months.

    


    Continuation
coverage under this Subsection 10.5 with respect to a COBRA Eligible Program may
not continue beyond the date:

    


    
      
        
          	
                  (1)  

                	
                  on
      which premium payments have not been made, in accordance with Subsection
      10.6 below;

                


        

      

    

    
      


    

    
      
        
          	
                  (2)  

                	
                  the
      Participant becomes entitled to
Medicare;

                


        

      

    

    
      


    

    
      
        
          	
                  (3)  

                	
                  on
      which the Employer ceases to maintain this Plan;
  or

                


        

      

    

    
      


    

    
      
        
          	
                  (4)  

                	
                  the
      Participant is no longer subject to a pre-existing condition exclusion
      under the Participant’s other coverage or new employer plan for the type
      of coverage available under this
Plan.

                


        

      

    

    
      


    

    10.6 Contribution
Requirements for COBRA Continuation Coverage.  Covered
Participants and Qualified Dependents who elect COBRA continuation coverage as a
result of a Qualifying Event will be required to pay continuation coverage
payments.  Continuation coverage payments are the payments required
for COBRA continuation coverage that is an amount equal to a reasonable estimate
of the cost to this Plan of providing coverage for all covered Participants at
the time of the Qualifying Event plus a  2% administrative
expense.  In the case of a disabled individual who receives an
additional 11-month extended coverage under COBRA, the Employer may assess up to
150% of the cost for this extended coverage period.  Such cost shall
be determined on an actuarial basis and take into account such factors as the
Secretary of the Treasury may prescribe in regulations.

    


    Covered
Participants and Qualified Dependents must make the continuation coverage
payment prior to the first day of the month in which such coverage will take
effect.  However, a covered Participant or Qualified Dependent has 45
days from the date of an affirmative election to pay the continuation coverage
payment for the first month's payment and the cost for the period between the
date medical coverage would otherwise have terminated due to the Qualifying
Event and the date the covered Participant and/or Qualified Dependent actually
elects COBRA continuation coverage.

    


    The
covered Participant and/or Qualified Dependent shall have a 30-day grace period
to make the continuation coverage payments due
thereafter.  Continuation coverage payments must be postmarked on or
before the completion of the 30-day grace period.  If continuation
coverage payments are not made on a timely basis, COBRA continuation coverage
will terminate as of the last day of the month for which timely premiums were
made.  The 30-day grace period shall not apply to the 45-day period
for the first month’s payment of COBRA premiums as set out in the section
above.

    


    If
payment is received that is significantly less than the required continuation
coverage payment, then continuation coverage will terminate as of the last day
of the month for which premiums were paid.  A payment is considered
significantly less than the amount due if it is greater than the lesser of $50
or 10% of the required continuation coverage payment.  Upon receipt of
a continuation coverage payment that is insignificantly less than the required
amount, the Plan Administrator must notify the covered Participant or Qualified
Dependent of the amount of the shortfall and provide them with an additional
30-day grace period from the date of the notice for this payment
only.

    


    10.7 Limitation
on Participant's Rights to COBRA Continuation Coverage.

    


    
      
        
          	
                  (1)  

                	
                  If
      a Qualified Dependent loses, or will lose medical coverage under this Plan
      as a result of divorce, legal separation, entitlement to Medicare, or
      ceasing to be a Dependent, such Qualified Dependent is responsible for
      notifying the Plan Administrator in writing within 60 days of the
      Qualifying Event.  Failure to make timely notification will
      terminate the Qualified Dependent's rights to COBRA continuation coverage
      under this Article.

                


        

      

    

    
      


    

    
      
        
          	
                  (2)  

                	
                  A
      Participant must complete and return the required enrollment materials
      within 60 days from the later of (a) the date of loss of coverage, or (b)
      the date the Plan Administrator sends notice of eligibility for COBRA
      continuation coverage.  Failure to enroll for COBRA continuation
      coverage during this 60-day period will terminate all rights to COBRA
      continuation coverage under this Article.  An affirmative
      election of COBRA continuation coverage by a Participant or his/her spouse
      shall be deemed to be an election for that Participant's Dependent(s) who
      would otherwise lose coverage under the
Plan.

                


        

      

    

    
      


    

    10.8 Subsequent
Qualifying Event.  If a second Qualifying Event occurs during
an 18-month extension explained above, coverage may be continued for a maximum
of 36 months from the date of the first Qualifying Event.  In the
event the Dependent loses coverage due to a Qualifying Event and after such date
the Participant becomes entitled to Medicare, the Dependent shall have available
up to 36 months of coverage measured from the date of the Qualifying Event that
causes the loss of coverage.  If the Participant was entitled to
Medicare prior to the Qualifying Event, the Dependent shall have up to 36 months
of coverage measured from the date of entitlement to Medicare.

    


    10.9 Extension
of COBRA Continuation Period for Disabled Individuals.  The
period of continuation shall be extended to 29 months in total (measured from
the date of the Qualifying Event) in the event the individual is disabled as
determined by the Social Security laws within 60 days of the Qualifying
Event.  The individual must provide evidence to the Plan Administrator
of such Social Security determination prior to the earlier of 60 days after the
date of the Social Security determination, or the expiration of the initial 18
months of COBRA continuation coverage.  In such event, the Employer
may charge the individual up to 150% of the COBRA cost of the
coverage.

    


    ARTICLE
11   PRIVACY OF MEDICAL INFORMATION

    


    11.1 Definitions.  For
purposes of this Article 11, the following defined terms shall have the meaning
assigned to such terms in this subsection:

    


    
      (1)           “Business
Associate” shall mean an outside entity or person that performs
administrative or other functions on behalf of the Plan;

    

    
      


    

    
      (2)           “Health
Care Operations” shall mean activities that involve, but are not
limited to, quality assessment and improvement, the assessment
of health care professionals, disease management, case
management, legal services, benefits fraud and abuse investigations,
and business planning and development (including cost-management
and planning analyses).  Health Care Operations
also include, but are not limited to, general health care plan
administrative functions such as management activities relating
to compliance with HIPAA’s administrative simplification requirements,
customer service involving the provision of data analysis
for the Plan Sponsor of the HIPAA Plan and other entities whose
employees participate in the HIPAA Plan, resolution of internal grievances
and due diligence in connection with the sale or
transfer of assets to a potential successor in interest if the potential
successor is a covered entity, or will become a covered entity,
under HIPAA;

    

    
      


    

    
      (3)           “HIPAA”
shall mean the Health Insurance Portability and Accountability
Act of 1996 as amended from time to time.

    

    
      


    

    
      (4)           “Payment”
shall mean any activities performed that involve making benefit
determinations and payment. These activities include, but are not limited to,
billing, reviews for medical necessity, claims management, coordination of
benefits, adjudication of health benefits claims (including appeals and other
payment-related disputes), subrogation, plan reimbursement, investigations of
potential fraud, determining employee contributions, reviews of appropriateness
of care, preauthorizations and utilization reviews;

    

    
      


    

    
      (5)           “Protected
Health Information” or “PHI” shall mean individually  identifiable
information created or retained by the HIPAA Plan beginning on or after April
14, 2003 which pertains to a person’s past, present or future physical or mental
health, the health care the person is receiving or has received in the past and
all past, present or future Payments for the person’s health
care;

    

    
      


    

    
      


    

    
      (6)           “Treatment”
means the provision, coordination or management of health
care and related services by one or more health care providers. This category
includes, but is not limited to, consultations and referrals between health care
providers, the coordination or management of health care by a health care
provider with a third party and the referral of a patient for health care from
one health care provider to another.

    

    
      


    

    11.2 Privacy
Provisions Relating to Protected Health Information
(“PHI”).  The
Plan and its Business Associates (collectively referred to in this Article 11 as
a “HIPAA Plan”) shall use and disclose PHI to the extent permitted by, and in
accordance with, HIPAA.  Specifically, each HIPAA Plan will use and
disclose PHI for Treatment, Payment and Health Care Operations.

    


    11.3 Disclosure
of De-Identified or Summary Health Information.  The HIPAA
Plan, or, with respect to the HIPAA Plan, a health insurance issuer, may
disclose de-identified or summary health information to the Plan Sponsor of the
HIPAA Plan (and its affiliates) if such entity requests the de-identified or
summary health information for the purpose of:

    


    
      (1)           Obtaining
premium bids from health plans for providing health insurance
coverage under the HIPAA Plan;

    

    
      


    

    
      (2)           Modifying,
amending or terminating the group health benefits under the
HIPAA Plan;

    

    
      


    

    
      In
addition, the HIPAA Plan or a health insurance insurer with respect to the HIPAA
Plan may disclose to the Plan Sponsor of the HIPAA Plan (or its affiliates)
information on whether an individual is participating in the group health
benefits provided by the HIPAA Plan or is enrolled in, or has ceased enrollment
with health insurance offered by the HIPAA Plan.

    

    
      


    

    11.4 The HIPAA Plan Will Use and
Disclose PHI as Required by
Law or as
Permitted by the Authorization of the Participant or
Beneficiary.

    


    Upon
submission of an authorization signed by a Participant, beneficiary, subscriber
or personal representative that meets HIPAA requirements, the HIPAA Plan will
disclose PHI to a Company (or affiliate) sponsored pension plan, long term care
plan, disability plan or other benefit plan sponsored by the Company (or an
affiliate) with a need to access this PHI for purposes related to such benefit
plan’s administration. Authorizations will also be honored when provided to the
HIPAA Plan with respect to job accommodation requests, Family Medical Leave Act
requests, drug/substance abuse testing, fitness for duty exams, and workers
compensation claims.

     

    
      In
addition, PHI will be disclosed to the extent permitted or required by law,
without the submission of an authorization form.

    

    
      


    

    11.5 Disclosure
of PHI to the
Plan Sponsor.  The HIPAA Plan
will disclose information to the Plan Sponsor only upon certification from the
Plan Sponsor that the HIPAA Plan documents have been amended to incorporate the
assurances provided below.

    


    
      The Plan
Sponsor agrees to:

    

    
      


    

    
      
        
          	
                  (1)

                	
                  not
      use or further disclose PHI other than as permitted or required by the
      HIPAA Plan document or as required by
law;

                


        

      

    

    
      


    

    
      
        
          	
                  (2)

                	
                  ensure
      that any affiliates or agents, including a subcontractor, to whom the Plan
      Sponsor provides PHI received from the HIPAA Plan, agrees to the same
      restrictions and conditions that apply to the Plan Sponsor with respect to
      such PHI;

                


        

      

    

    
      


    

    
      
        
          	
                  (3)

                	
                  not
      use or disclose PHI for employment-related actions and decisions unless
      authorized by the individual to whom the PHI
  relates;

                


        

      

    

    
      


    

    
      
        
          	
                  (4)

                	
                  not
      use or disclose PHI in connection with any other benefits or employee
      benefit plan of the Plan Sponsor or its affiliates unless permitted by the
      Plan or authorized by an individual to whom the PHI
    relates;

                


        

      

    

    
      


    

    
      
        
          	
                  (5)

                	
                  report
      to the Plan any PHI use or disclosure that is inconsistent with the uses
      or disclosures provided for of which it becomes
  aware;

                


        

      

    

    
      


    

    
      
        
          	
                  (6)

                	
                  make
      PHI available to an individual in accordance with HIPAA’s access
      rules;

                


        

      

    

    
      


    

    
      
        
          	
                  (7)

                	
                  make
      PHI available for amendment and incorporate any amendments to PHI in
      accordance with HIPAA;

                


        

      

    

    
       

      
        
          
            
              	
                      (8)

                    	
                      make
      PHI available for amendment and incorporate any amendments to PHI in
      accordance with HIPAA;

                    


            

          

        

        
           

        

      

    

    
      
        
          	
                  (9)

                	
                  make
      internal practices, books and records relating to the use and disclosure
      of PHI received from the HIPAA Plan available to the Secretary of the
      United States Department of Health and Human Resources for purposes of
      determining the Plan’s compliance with HIPAA;
  and

                


        

      

    

    
       

    

    
      
        
          	
                  (10)

                	
                  if
      feasible, return or destroy all PHI received from the HIPAA Plan that the
      Plan Sponsor still maintains in any form, and retain no copies of such PHI
      when no longer needed for the purpose for which disclosure was made (or if
      return or destruction is not feasible, limit further uses and disclosures
      to those purposes that make the return or destruction
      infeasible.)

                


        

      

    

    
      


    

    11.6 Separation
Between the Plan Sponsor and the HIPAA Plan.  In accordance
with HIPAA, only the following employees and Business Associate personnel shall
be given access to PHI:

    


    
      
        
          	
                  (1)

                	
                  employees
      of the AT&T Benefits and/or AT&T Executive Compensation
      organizations responsible for administering group health plan benefits
      under the HIPAA Plan, including those employees whose functions in the
      regular course of business include Payment, Health Care Operations or
      other matters pertaining to the health care programs under a HIPAA
      Plan;

                


        

      

    

    
      


    

    
      
        
          	
                  (2)

                	
                  employees
      who supervise the work of the employees described in (1),
      above;

                


        

      

    

    
      


    

    
      
        
          	
                  (3)

                	
                  support
      personnel, including other employees outside of the AT&T Benefits or
      AT&T Executive Compensation organizations whose duties require them to
      rule on health plan-related appeals or perform functions concerning the
      HIPAA Plan;

                


        

      

    

    
      


    

    
      
        
          	
                  (4)

                	
                  investigatory
      personnel to the limited extent that such PHI is necessary to conduct
      investigations of possible
fraud;

                


        

      

    

    
      


    

    
      
        
          	
                  (5)

                	
                  outside
      and in-house legal counsel providing counsel to the HIPAA
      Plan;

                


        

      

    

    
      


    

    
      
        
          	
                  (6)

                	
                  consultants
      providing advice concerning the administration of the HIPAA Plan;
      and

                


        

      

    

    
      


    

    
      
        
          	
                  (7)

                	
                  the
      employees of Business Associates charged with providing services to the
      HIPAA Plan.

                


        

      

    

    
      


    

    
      The
persons identified above shall have access to and use PHI to the extent that
such access and use is necessary for the administration of group health benefits
under a HIPAA Plan.  If these persons do not comply with this Plan
document, the Plan Sponsor shall provide a mechanism for resolving issues of
noncompliance, including disciplinary sanctions.