Dependability is never overrated Anthem Blue Cross and Blue SHield’S New Policy option

Health care reform is here And it’s bringing change with it, especially for your individual clients Changes to the types of health plans offered Changes to the way premiums are calculated Beginning January 1, 2014, the Patient Protection and Affordable Care Act, or PPACA, will dramatically change the individual health plans offered and how their premiums are calculated.   Individual rates will no longer be based on a person’s claims experience and health status, which could mean significant premium changes for some, possibly many. At Anthem Blue Cross and Blue Shield, we’re ready with a New Policy Option designed for members on many of our non-grandfathered Individual plans (plans that were in effect after March 23, 2010). This option buys you and your clients valuable time so together you can evaluate the best long-term strategy for their individual health care needs. Changes to how individuals are rated 2

As of 2014, no qualified individual applying for individual insurance can be turned down Premiums Cannot be health-based Rating bands Limited to no more than 3:1 Community ratings determine premiums Premium rates will no longer be based on health status, gender, or claims.   Individual plans will be guaranteed issue, and premiums cannot be health-based. No one can be turned down for health insurance because of a health problem or history of health problems. Plans must use a 3:1 rating band, which means the highest premium can be no more than three times the lowest premium. With community rating, rates consist of: Age Family size where they live whether they use tobacco products (in some states) In other words, business as usual no longer exists. In fact, a study by the actuarial firm Milliman in Ohio shows the changes expected for individuals will range from a 20 percent to 35 percent in the State of Ohio for health care coverage purchased inside and outside the exchange. However the issue is widely discussed around the health care industry with assumptions ranging from 20 percent to well in excess of 50 percent. 3

Members will have to ask themselves: When will exchanges be available? Are my premiums going to change? How much will a new plan cost? Will my benefits and network change? What features of my current plan do I value most? I hear a lot about subsidies — am I eligible? What’s the advantage of staying with Anthem Blue Cross and Blue Shield? Do I need to make a decision today? In a time of pretty significant uncertainty, you and your clients are being asked to make some big decisions. For example, individuals will have to ask themselves if they should shop on the new health insurance marketplace or continue buying directly from us). They will be wondering?: When will exchanges be available? Are my premiums going to change? How much will a new plan cost? Will my benefits and network change? What features of my current plan do I value most? I hear a lot about subsidies—am I eligible? What’s the advantage of staying with Anthem Blue Cross and Blue Shield? Do I need to make a decision today? Speaker: Please note that in some markets some individuals will not have the option of staying with Anthem BCBS because the individual plan offered will be through a separate HMO entity. 7 4

What will all this mean to your clients? There will be a lot of changes and new plans. Your clients will need your assistance now more than ever to help them choose a plan that is right for them. 5 5

facing big changes—and big decisions—in 2014 Individuals are facing big changes—and big decisions—in 2014 No matter how you look at it, your individual clients are facing big changes—and big decisions—in 2014. And the bottom line is that it may be best for of your clients to let the dust settle on health care reform before making major changes to their plan. So, why not slow down and give your clients some time to think about what is right for them? That way, you will have the time you need to find the best possible solutions for their individual health care needs. 6

There are a lot of complex questions and there’s one simple answer Anthem Blue Cross and Blue Shield’s New Policy Option With Anthem Blue Cross and Blue Shield’s new policy option, individuals may keep their current level of coverage through November 30, 2014 at their new December 2013 rate. They can sync their medical and specialty coverage renewal dates for maximum convenience. 7

Their new policy option begins in December 2013 Here’s how our new policy option works for individuals with effective renewal dates in 2014 Their new policy option begins in December 2013 They lock in December 2013 pre-community-rated rates They’re entitled to a new 12-month rate guarantee Here’s how our new policy option works.   We are providing many of our members with options where members can purchase policies with their current levels of benefits. Members on many of our non-grandfathered Individual plans (plans that were in effect after March 23, 2010) will be offered the opportunity to keep similar benefits and coverage by completing a new policy option acceptance form that will be effective December 1, 2013. If they accept the option, members may keep their current level of coverage through November 30, 2014 at their new December 2013 rate. Our new policy option changes their health plan’s anniversary month. For instance, if they renew on December 1, December 1 will be their anniversary date going forward—regardless of their former anniversary date. This also applies to renewal dates for dental and vision. Upon renewal, the individual is entitled to a new 12-month rate guarantee. Their renewal dates for dental and vision will change, too 8

What our new policy option means for individuals With the new policy option, individuals will retain the plan they're familiar with (including the network of doctors and hospitals), giving them time to focus on their health instead of the complicated health care guidelines. They'll also be able to sync their renewal dates for medical, vision and dental for maximum convenience. Additionally their deductibles and out-of-pocket maximums will remain on a calendar year schedule. So your clients deductible/coinsurance counters will not reset away from the schedule that they are currently on. . They can keep the plan they're familiar with and ensure stability during changing times They can focus on their health instead of complicated health care guidelines They can sync their renewal dates for medical, vision, and dental for maximum convenience Their deductibles and out-of-pocket maximums reset per the terms of their contract 9

What our new policy option means for brokers You have access to the resources you need for a seamless experience You can get valuable time to evaluate all the options under the new PPACA guidelines You can help many of your non-grandfathered individual clients find the right solution for their particular situation The extra time granted by our new policy option will give you the opportunity to evaluate all the options under the new health care guidelines so you can find the right solutions for your clients. And Anthem will provide you with the resources you need for a seamless new policy option experience. 10

We’re here to support you, every step of the way Your clients rely on you to advise them We’re here to support you, every step of the way To give you more time to assist your clients with making plan selections, we are providing many of our members with options where members can purchase policies with their current levels of benefits. Anthem is making it easy for you while you work on evaluating their options under the new PPACA guidelines. 11

The new policy option process You and your client discuss the new policy option Client receives the New Policy/Contract Acceptance Form in September We’ll send out new policy option information in September. If you think the new policy option is the right choice for your client, simply have them complete the New Policy/Contract Acceptance Form and return via mail or fax. Their completed and signed acceptance form needs to be received by Anthem Blue Cross and Blue Shield no later than November 15, 2013. Then we’ll get started. Your client mails or faxes completed form to us no later than November 15, 2013 12

One size does not fit all Discuss our new policy option with your clients today Anthem Blue Cross and Blue Shield’s new policy option buys you and your clients more time to evaluate all the options and find the right solution. It’s another way Anthem Blue Cross and Blue Shield supports you, while you support your clients.   13

For more information about the changes for your clients, visit makinghealthcarereformwork.com Or contact your Anthem Blue Cross and Blue Shield representative or Broker Services at: CO: (866) 317-9021 NV: (866) 317-9022 Central: (800) 742-8199 VA: (800) 225-3611 14