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Retiree ReadinessHelping You Transition toSupplemental Medicare Insurancetowerswatson.com 2014 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.1

A Bit of Context TCU changed the way it provides medicalbenefits to Medicare-primary retirees and theirMedicare-primary dependents. Retiree’s medical benefits are managed through aHealth Reimbursement Arrangement account(HRA). 2013 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.2

What we’ll cover today Why this approach? How this affects you Medicare 101 Introducing OneExchange Going forward Questions & answers 2013 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.3

Why This Approach? Provides Medicare-eligible retirees with: Greater flexibility in how to use health care dollars A broader range of plan options Enables TCU to continue supporting retirees duringa time of uncertainty surrounding the rising cost ofmedical insurance and services Enables TCU to predict and budget for health carecosts more accurately 2013 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.4

How This Affects MedicareEligible RetireesWhat youpay Medical premiums and out-of-pocket costs will varydepending on the coverage you choose.How toenroll You will work with OneExchange to enroll in a planthat meets your medical and Rx needs. TCU will establish your Health ReimbursementAccount. This account will be administered byOneExchangeYoursupport OneExchange Advisors will help you understand thecosts associated with your coverage – premiums, copayments, deductibles and all other costs. 2013 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.

Medicare 101 Everything you wanted to know about Medicare, butwere afraid to ask! 2013 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.

CMS – Center for Medicare & Medicaid ServicesHHS agency that governs everything Medicare1-800-MEDICAREtowerswatson.com 2014 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.7

Original Medicare: A Health insurance program for– People 65 years of age and older– Some people with disabilities– People with End Stage Renal Disease (ESRD) Administered by CMS and the State Department of Insurance Enrollment handled by Social Security Administration or RailroadRetirement BoardKey TermsMedicare Part A Hospital Coverage – administered by CMSMedicare Part B Medical Coverage – administered by CMSMedicare Part C Medicare Advantage Plans – private plans – group or individual marketMedicare Part D Prescription Drug Coverage – private plans – group or individual marketMedicare Supplement (Medigap) – private plans – group or individual market8 2013 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.

Original Medicare: Part A (Hospital)Premiums: Most people do not pay a monthly Part A premium because they or aspouse have 40 or more quarters of Medicare-covered employment.– 254.00 for 30-39 quarters of Medicare-covered employment.– 461.00 for people who have less than 30 quarters of Medicare employment.Foreign citizens and Americans who worked abroadCoverage: Medicare Part A covers:– Hospital Stays– Skilled Nursing Facility (SNF)– Home Health Care– Hospice Care – Pints of blood received at a hospital or skilled nursingfacility during a covered stay9 2013 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.

Original Medicare: Part B(Medical)Coverage: Doctors’ services (physician office and some hospitalsettings)Limited Chiropractic ServicesOutpatient Services:Diagnostic tests- clinical Labo (x-ray, MRI, CAT, EKT, nutritional therapy, etc )Other medical serviceso Durable medical equipment (DME)- prosthetic, wheelchair etc.o Diabetic Supplieso Ambulance serviceInitial Enrollment Period:o When turning 65.o3 months before, the month of, and three months after 65th B-Day. (7 month window)10 2013 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.

Medicare Part B - Late Enrollment PenaltyA person that is eligible for Medicare but opts out of Part B may besubject to a 10% per year Part B penalty Penalty is waived if beneficiary has coverage through a group policy basedon active employment 2013 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.

Medicare Eligibility & ActiveEmploymentFor employers with 20 or more employees, group coverage is primary forMedicare beneficiaries who are still active, and Medicare issecondary. Therefore, active beneficiaries don’t have to enroll in Part B and willnot be penalized when they decide to retire. When they decide to retire,beneficiaries should enroll in Part B three months prior. This will insure that theycan enroll in a Medicare Supplement plan and have it effective as soon as theirgroup coverage ends. If active and covered under the group health plan, employee does not enroll in Medicare Part Bor select a Medicare supplemental plan(s) until they retire or lose coverage.12 2013 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.

Post – 65 Coverage OptionsPrimary CoverageMedicare A & BAdditional Coverage (your choice)Medicare Advantage withPrescription Drug (MAPD)ORMedigap Prescription Drugtowerswatson.com 2014 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.13

OPTION 1Medicare Advantage Plan with Prescription Drug Coverage (MAPD)*HMOMEDICAREADVANTAGEPPO* Note that Medicare Advantage plans are generally network based plans.towerswatson.com 2014 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.14

OPTION 2Medigap Plan Part D PlanMEDIGAPPLANPART DPLANNote: You may need to pay your first premium when you enroll in coverage.towerswatson.com 2014 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.15

MediGap – Lettered PlansMedicare Supplement Insurance (Medigap) PlansBenefitsABCDFGKLMNMedicare Part A coinsuranceand hospital costs (up to anadditional 365 days afterMedicare benefits are are Part B coinsuranceor od (first 3 pints)100%100%100%100%100%100%50%75%100%100%Part A hospice carecoinsurance or 0%100%80%80%Skilled nursing facility carecoinsurancePart A deductiblePart B deductible100%100%100%Part B excess chargesForeign travel emergency(up to plan limits)80%80%Source: CMS100%100%80%80%Out-of-Pocketlimit in 2015 4,940 2,470towerswatson.com 2015 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.16

Medicare Prescription Drug Coverage 2016You pay 45% of Brand Nameand 58% of Generics untilyour out of pocket costsreach 4850; Pharmaceuticalcontributions will counttowards the 4850 TrOOP(True Out of Pocket)You Pay Full RetailUntil Deductible is Met2016 - 0 to 360DeductibleInitialCoverageYou pay copays foryour plan coveragefor the first 3310 inactual costs ofMedicationsCoverageGapOnly 25% reachDonut HoleCatastrophicCoverageOnly 4% reachCatastrophicYou Pay 2.95 forGenerics and 7.40 forBrand Name or 5% whichever is greatertowerswatson.com 2015 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.17

Aging Into Medicare – Turning 65All Medicare beneficiaries receive a Medicare card when theybecome eligible. This will contain their full name, Medicare Claimnumber and the dates your Medicare Part A and B becameeffective. Beneficiaries may use this card with any medicalprovider in the country that accepts Medicare.A beneficiary is automaticallyenrolled in Part B when enrolledin Medicare Part A. If you do notwant Part B, you must opt out ofthat coverage.This card is generally sent threemonths before turning age 65.Must Have Original Medicare A & B to be Able to Consider AnySupplemental Medicare Medical Insurance [either Advantage or Gap]towerswatson.com 2014 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.18

OneExchangeHelping You Prepare For Your Upcoming Medicare EnrollmentTOWERS WATSON 2013 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.

Who We Are Transitions Can Be A Good Thing! OneExchange – For Your Benefit A Deeper Dive – Benefit Advisors,Private Exchange, Optimize Savings,Retiree Reimbursement Account for You Next Steps Questions and Answerstowerswatson.com 2015 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.20

Transitioning from Employee to RetireeHealthcare BenefitsAccess to retiree health benefits for Medicareeligible retirees and their Medicare-eligible dependents isprovided through OneExchange OneExchange was chosen after an extensive evaluation ofchoices OneExchange will help you with total care in your transitionover to more-effective individual Medicare health insurance The private exchange offers greater choice and flexibility;many affordable choices exist and in many cases providemore value at a lower cost than an employer group plan Ongoing support – at no cost to you 2013 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.21

About OneExchange RetireeTowers Watsonover100Over 1-millionLicensed advisorprovidesguidance and ongoing540 employersadvocacyretirees served acrossyears experienceanationwide network of carriersPersonalized options with plansfromFounded in 2004More Choice, More Flexibility– Better ValueFirst and LargestNo fees forour serviceOur10th annualprivate Medicare Exchangeenrollment seasontowerswatson.com 2014 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.22

The Transition tlessEnrollmentOngoingAdvocacytowerswatson.com 2014 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.23

Our Service CentersOperating hours:Monday – Friday,7:00 a.m. until 8:00 p.m.Central TimeSalt Lake City, UTDallas, TXtowerswatson.com 2014 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.100% Domestic WorkforceNo Outsourcing!

Plans and PartnersAll Medicare Plan TypesMedicare Supplement(Medigap)Medicare AdvantagePrescription Drug(Part D)A few examples of the carriers on our Medicare exchange:Multiple plans available to you from national/regional carrierstowerswatson.com25 2014 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.towerswatson.com

The Transition tlessEnrollmentOngoingAdvocacytowerswatson.com 2015 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.26

EducationEnrollment Guide: Prepare forYour Enrollment Consultation Review Medicare basics What to expect on yourenrollment call FAQs Appointment confirmationToll rswatson.com 2015 Towers Watson. All rights reserved. Proprietary and Confidential. For Towers Watson and Towers Watson client use only.27