YOUR Cigna CHOICE FUND ® HEALTH SAVINGS ACCOUNT

YOUR Cigna CHOICE FUND ® HEALTH SAVINGS ACCOUNT
A Health Plan plus a Health Savings Account Optional info Presenter Date/Location

AGENDA HSA Components and Rules of the Road Benefits of an HSA
Managing an HSA Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna

HSA COMPONENTS AND RULES OF THE ROAD

WHAT IS THE Cigna CHOICE FUND HSA?
Employer HSA contribution Qualified Medical Plan HSA Tax-Advantaged Plan + = Your HSA contribution A health plan that provides coverage for qualified medical/pharmacy expenses and allows you the option to save HSA dollars on a tax advantaged basis. Your employer contributes and you can too! The total 2013 annual contribution limit for employee + employer is: - $3,250 Single Coverage - $6,450 Family Coverage The total 2014 annual contribution limit for employee + employer is: - $3,300 Single Coverage - $6,550 Family Coverage Employee and employer money deposited into the HSA is generally not taxable Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna

WHAT IS A QUALIFIED HIGH-DEDUCTIBLE HEALTH PLAN?
Minimums For 2013 and 2014, the minimum deductible is $1,250 Single and $2,500 Family All expenses (medical/pharmacy) are subject to a common deductible before the plan begins to pay. (If the Single deductible is less than $2,500, the Family deductible must be collective) Preventive Care can be covered at 100% prior to deductible being met For 2013 the sum of the plan’s annual deductible and other annual out of pocket requirements (other than premiums) cannot exceed $6,250 Single and $12,500 Family. For 2014 those amounts increase to $6,350 Single and $12,700 Family Once the Out-of-Pocket Maximum is met, the plan pays 100% for covered medical/pharmacy expenses Out-of-Pocket Maximums 100% Coverage Once Out of Pocket Met Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna

HSA – UNDERSTANDING THE COMPONENTS
Coinsurance 80% In Network 100% Preventive Care Coinsurance 80% In Network 100% Preventive Care $3,000 Out-of-Pocket $6,000 Out-of-Pocket Your Share $750* Your Share $1,500* $1,500 Ded $3,000 Ded HSA provided by Employer $750 HSA provided by Employer $1,500 EMPLOYEE ONLY FAMILY OF 2 OR MORE * With no additional contribution from employee Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna

HOW IS THIS DIFFERENT FROM A TRADITIONAL PLAN?
Max you’ll pay after deductible is met Same Wide choice of doctors/hospitals Preventive care covered at 100% Plan begins to pay after deductible is met Covers routine, emergency and catastrophic care Plan pays percentage of bill for covered out-of- network care Plan pays higher percentage for covered in-network care Cigna receives bills, sends payment to doctors/hospitals Different Lower premium but higher deductible Plan begins to pay after deductible is met; however, funds in your HSA can be used to cover eligible health expenses such as the deductible Limit on out-of-pocket expenses Unused HSA money rolls over to next year Earn extra money for taking Health Assessment Coinsurance 100% Preventive Care Out-of-Pocket Your Share Deductible HSA provided by Employer Unused $ rolls over to next year Earn extra $ for taking Health Assessment DELETE IF HSA INCENTIVE NOT OFFERED Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna

WHO IS ELIGIBLE TO PARTICIPATE IN AN HSA?
To contribute to an HSA, the IRS requires that individuals: Must be enrolled in a qualified HSA medical plan (Cigna Choice Fund HSA is a qualified medical plan) Cannot have any other health coverage (this applies to the employee only) Not covered by spouse’s medical or pharmacy plan Not covered through Medicare Part A, Part B, Part D, or through TRICARE Not covered through a general-purpose Flexible Spending Account (FSA) plan (either employer’s or spouse’s) Cannot be claimed as a dependent on another person’s tax return Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna

MAXIMUM CONTRIBUTIONS (EMPLOYER + EMPLOYEE)
Because HSA’s offer special tax advantages, the IRS puts annual limits on the maximum amount that can be contributed to the account: Under age 55: up to $3,250 if enrolled with Single coverage in 2013 up to $3,300 if enrolled with Single coverage in 2014 up to $6,450 if enrolled with Family coverage in 2013 up to $6,550 if enrolled with Family coverage in 2014 Age 55 or older: Maximum contribution increases by $1,000 (considered a “catch-up” contribution) To make the maximum contribution in a calendar year, individuals must: Meet all requirements to be eligible for HSA contributions on January 1 Remain qualified through December 1 If these criteria are not met, maximum contribution is prorated = 1/12 maximum contribution for each month individual is qualified Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna

HOW ARE CONTRIBUTIONS MADE TO THE CHOICE FUND HSA?
Employer Accountholder Account Holders Unscheduled Deposits to the HSA Account Transfers from other HSA Accounts Payroll withholding of Employee HSA contributions Employer Contributions to Employee HSA accounts Post-Tax Deposits or Transfers to the HSA Account Transfers from other HSA Accounts Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna

BENEFITS OF AN HSA

TRIPLE TAX ADVANTAGES OF AN HSA
Payroll deduction contributions are pre-tax* After-tax contributions can be deducted when you file your tax return Interest earned on your cash account is generally not taxable* Investment earnings on mutual funds are generally not taxable* Withdrawals to pay qualified health care expenses are tax-free Withdrawals for ineligible expenses are taxed and you pay a 20% penalty At age 65, withdraw funds for any reason with no penalty (taxes do apply) Contributions HSA Account Growth Withdrawals * HSA contributions and earnings are not subject to federal taxes and not subject to state taxes in most states. A few stats do not allow pretax treatment of contributions or earnings: Alabama, California, New Hampshire and New Jersey. Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna

You choose how and when to use your HSA
SAVING FOR THE FUTURE 100% Rollover of HSA dollars year over year Portable – take it with you Use HSA dollars to pay premiums for: COBRA Long-Term Care Medicare Use as Income During Retirement You choose how and when to use your HSA Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna

Comprehensive Investment Offering
INVESTMENTS Planning for the future Comprehensive Investment Offering 36 mutual funds to choose from Minimum to invest: $2,000 No minimum deposit for any fund Once the investment account is open, no minimum balance applies Automatic Reinvestment features Investments can be allocated into one fund or multiple funds on a scheduled or unscheduled basis Convenient Online Experience & Reporting Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna

MANAGING AN HSA

USING HSA FUNDS Dependents to age 26 Domestic Partners
Dependents to age 26, Domestic Partners and Eligible Expenses Dependents to age 26 Dependents to age 26 may be enrolled in your medical plan. HSA funds may only be used for expenses of that dependent if the dependent is claimed on the employee’s tax return. Domestic Partners HSA funds may not be used for Domestic Partner expenses. The IRS requires that HSA funds be used only for federally qualified tax dependents. Eligible Expenses Use the HSA for medical, prescription drugs, dental, vision and certain premium expenses Expenses for anyone you claim as a Federal tax dependent (other than Domestic Partners – see above) Your HSA cannot pay for expenses of children to age 26 who are not claimed as a dependent (see above) You are responsible for making sure your expenses are eligible according to IRS Publication 502 If you use money from your HSA for ineligible expenses, you will pay taxes plus a 20% penalty (prior to age 65) Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna

WHAT WILL YOU RECEIVE ONCE YOUR BANK ACCOUNT IS OPENED?
Chase mails the following to your home approximately 7–10 days before the Plan Start Date or after the verification of identity (whichever is later): HSA debit card(s) and brochure outlining the Terms & Conditions for the card. (During the bank application process, you can request two cards. If not specified, you will receive one card.) Welcome Brochure including instructions for activating the debit card (will need activation code, which is the last four digits of SSN) Checkbook (if requested during enrollment/application process.) Bank will send a “Check Signature Card Form” in a separate mailing, which must be completed and returned before a checkbook can be issued. Deposit slips to make post-tax contributions. (Pre-tax contributions are made via payroll deduction.) Medical plan ID cards are mailed separately from Cigna Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna

HSA ACCESS TO FUNDS Customers choose when and how they access their money Use the MasterCard-branded debit card to pay for out-of-pocket expenses The card can also be used to get cash at ATMs to reimburse yourself for qualified expenses paid with personal funds Debit Card Online Bill Pay & Electronic Fund Transfer Pay expenses directly from the HSA Monitor, manage and schedule payments online, anytime Payments can be scheduled on a one-time or recurring basis Checkbook Purchase and write checks to pay for out-of-pocket expenses Automatic Claim Forwarding (ACF) Cigna will automatically pay eligible medical expenses from your HSA This option can be selected at enrollment or any time during the year Regardless of how the HSA is accessed, all balance and transaction activity is available online at myCigna.com Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna

MANAGING YOUR HSA Using your debit card Requesting additional cards
Use to pay for prescriptions at the pharmacy Use as a credit card to pay a bill up to $5,000 Use as a debit card to pay a bill up to $3,000 Make ATM withdrawals – bank limits typically $200 to $500 per day Requesting additional cards Request a card for your spouse or a dependent such as a child away at college through the JPMorgan Chase online banking portal Turning paper statements on or off through the JPMC banking portal Statements are available online Paper statements are available for $1.25 per statement Transfer money from investments to pay health care expenses Claims cannot be paid from your investment account Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna

MANAGING YOUR HSA ON THE GO
Manage your account anytime, anywhere Get mobile or alerts from JPMorgan Chase Sign up for alerts on the JPMC online banking portal you access through myCigna.com Choose s or text messages – it’s your choice Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna 20

TAX RESPONSIBILITIES AND REPORTING
Bank Client Bank reporting for year-end taxes will be sent to the employee (accountholder) Form 1099-SA – Reporting all distributions from the HSA Form 5498-SA – Reporting of contributions and transfers into the HSA Client reporting for year-end taxes will be sent to the employee (accountholder) Form W-2: Reporting all employer contributions, including pretax payroll deductions. Employer contributions are not considered part of your income Employee Employee (accountholder) responsibility Ensure total contributions do not exceed allowable maximums Keep accurate records of contributions and withdrawals Maintain receipts for all use of HSA dollars: purchases and bill payments File form 8889 as part of income tax submission to the IRS Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna

IF YOU NEED MORE INFORMATION
myCigna.com Available 24/7/365 Single Sign On to your HSA Information Personalized site to learn about your benefits, track claims and much more Customer Service 24/7/365 Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna

EDUCATIONAL TOOLS AND RESOURCES
Electronic Interactive FAQ (with voice over) Vignettes Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna 23

EDUCATIONAL TOOLS AND RESOURCES
HSA Suite of Calculators Includes three calculators: Contribution Tax Savings Future Value Choice Fund HSA Video How to use your HSA Investment options Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2012 Cigna 24 24

SINGLE SIGN-ON TO JPMORGAN CHASE
JPMC Web Demo Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna

CUSTOMER SERVICE TO HELP MANAGE THE HSA
By Phone One toll-free number on the back of the ID card and debit card Available 24 hours a day, 7 days a week Specially trained Cigna Customer Service Representatives answer questions about: Medical and pharmacy benefits and claims HSA IRS requirements HSA transaction activity and balance Warm transfer to JPMorgan Chase for specialized activity (investments, lost debit card) Directs callers to additional tools available on myCigna.com Online Single sign-on to Medical and HSA activity through myCigna.com Medical/pharmacy information Find a physician or facility participating in the Cigna network Access cost and quality tools HSA information Manage investment accounts via link to JPMorgan Chase Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna

HOW ARE MEDICAL CLAIMS PAID?
Sick visit to an in-network doctor/hospital. Show your Cigna Choice Fund ID card. ID Card Health Care Professional files claim with Cigna directly. Cigna receives the claim and processes it based on the plan deductible, covered expenses and Cigna-negotiated discounts. EOB Cigna provides an Explanation of Benefits or EOB (“receipt”) showing: Doctor’s charge, Cigna discount, amount billed, (amount deducted from the HSA if elected), amount paid to doctor/facility and remaining HSA balance (if medical automatically claim forwarding elected). Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna 27 27

WHAT HAPPENS WHEN AN EMPLOYEE LEAVES THE PLAN?
Change in employee status or plan change Employer Send updated eligibility information to Cigna. Termination is received by the HSA system via the eligibility file. After 15 days, the termination is released to the bank and they begin process to convert HSA to an individual account. Employee HSA dollars are portable and theirs to keep. No longer able to contribute to the HSA (unless covered through an HSA-qualified plan and remain eligible). Can continue using the HSA funds for qualified health care expenses for their qualified dependents. Bank begins 30-day process to transition account to a free- agent account. Employee may have different/additional account fees. Receives letter from bank outlining changes to the account and the options available: Transfer the account to a free-agent account with JPMorgan Chase Transfer the funds to an HSA at another institution Close the account If free-agent account is opened, employee will have a direct relationship with the bank. (The bank cannot provide Cigna will any information about the account.) Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna 28

Total Medical Expenses $1,100 Total Medical Expenses $1,100
*Update this slide as needed for your client ASHLEY Single female in good health with occasional cold/flu OAP Choice Fund HSA $350 Preventive care exam 100% paid by Cigna $190 PCP visit for cold/flu $15 copay then 100% paid by Cigna $280 Specialist follow-up office visit $30 copay then 100% paid by Cigna $ Generic Retail Prescription $120 copay then 100% paid by Cigna $350 Preventive care exam 100% paid by Cigna $190 PCP visit for cold/flu $190 paid by Ashley – deductible not yet met $280 Specialist follow-up office visit $280 paid by Ashley – deductible not yet met $ Generic Retail Prescription HSA Plan Details: $1,500 Deductible HSA Fund: $500 = Employer Funded $2,000 = Ashley Funded $2,500 Total Total Medical Expenses $1,100 How expenses are paid $350 paid by Cigna $750 paid by Ashley (either with HSA or personal funds) Total Medical Expenses $1,100 How expenses are paid $935 paid by Cigna $165 paid by Ashley Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna 29

HOW DOES IT ADD UP FOR ASHLEY?
Update this slide as needed for your client Choice Fund HSA Employee Premiums Premium $896 HSA Fund Employer: $500 Ashley: $2,000 Total: $2,500 Expenses: $1,100 Cigna Paid: $350 HSA Fund Paid: $750 Ashley Paid: $0 Total Annual Cost to Ashley: $896 Insert Additional plan info or delete if not needed OAP Employee Premiums Premium $1,703 Fund: Expenses: $1,100 Cigna Paid: $935 Ashley Paid: $165 Total Annual Cost to Ashley: $1,868 $1,750 rolls over to her HSA fund for the future Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna

Update this slide as needed for your client CARLOS Single active male in good health with serious sport injury requiring surgery and physical therapy OAP Choice Fund HSA $250 Preventive care exam 100% paid by Cigna $130 Urgent Care visit $35 copay then 100% paid by Cigna $1,400 Outpatient Surgery $550 paid by Carlos (deductible + coinsurance) $880 (80%) paid by Cigna $280 Specialist follow-up office visit $30 copay then 100% paid by Cigna $ Physical Therapy visits $300 copay then 100% paid by Cigna $70 3 Generic Prescription $250 Preventive care exam 100% paid by Cigna $130 Urgent Care visit $130 paid by Carlos – deductible not yet met $1,400 Outpatient Surgery $1,376 paid by Carlos (deductible + coinsurance) $24 (80%) paid by Cigna $280 Specialist follow-up office visit $56 paid by Carlos, $224 paid by Cigna $ Physical Therapy visits $74 paid by Carlos, $296 paid by Cigna $70 3 Generic Prescription $14 paid by Carlos, $56 paid by Cigna HSA Plan Details: $1,500 Deductible HSA Fund: $500 = Employer Funded $2,000 = Carlos Funded $2,500 Total Total Medical Expenses $2,500 How Expenses Are Paid $1,585 paid by Cigna $915 paid by Carlos Total Medical Expenses $2,500 How Expenses Are Paid $850 paid by Cigna $1,650 paid by Carlos (either with HSA or personal funds) Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna 31

HOW DOES IT ADD UP FOR CARLOS?
Update this slide as needed for your client Choice Fund HSA Employee Premiums Premium $896 HSA Fund Employer: $500 Carlos: $2,000 Total: $2,500 Expenses: $2,500 Cigna Paid: $850 HSA Fund Paid: $1,650 Carlos Paid: $0 Total Annual Cost to Carlos: $896 Insert Additional plan info or delete if not needed OAP Employee Premiums Premium $1,703 Fund: Expenses: $2,500 Cigna Paid: $1,585 Carlos Paid: $915 Total Annual Cost to Carlos: $2,618 $850 rolls over to his HSA fund for the future Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna 32

THE SMITHS Update this slide as needed for your client Healthy family with pregnant wife OAP Choice Fund HSA $600 Preventive Care Exams 100% paid by Cigna $7,000 OB Delivery Charges $1,640 paid by Smiths (deductible + coinsurance) $5,360 paid by Cigna (80%) $280 Specialist follow-up office visit $30 copay then 100% paid by Cigna $80 New Born well child visit $600 Preventive care exams 100% paid by Cigna $7,000 OB Delivery Charges $3,800 paid by Smiths (deductible + coinsurance) $3,200 paid by Cigna (80%) $280 Specialist follow-up office visit $56 paid by Smiths. $224 paid by Cigna $80 New Born well child visit Total Medical Expenses $7,960 How Expenses Are Paid $6,290 paid by Cigna $1670 paid by the Smiths Total Medical Expenses $7,960 How Expenses Are Paid $4,104 paid by Cigna $3,856 by the Smiths (either with HSA or personal funds) Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna 33

HOW DOES IT ADD UP FOR THE SMITHS?
Update this slide as needed for your client Choice Fund HSA Employee Premiums Premium $2,964 HSA Fund Employer: $1,000 Smiths: $4,000 Total: $5,000 Expenses: $7,960 Cigna Paid: $4,104 HSA Fund Paid: $3,856 Smiths Paid: $0 Total Annual Cost to Smiths: $2,964 Insert Additional plan info or delete if not needed OAP Employee Premiums Premium $3,752 Fund: Expenses: $7,960 Cigna Paid: $6,290 Smiths Paid: $1,670 Total Annual Cost to Carlos: $5,422 $1,144 rolls over to their HSA fund for the future Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna

INNOVATIVE AND HELPFUL ENROLLMENT SUPPORT
myCignaPlans.com Cigna Customer Service available 24/7: for instructions and helpful tips to build and customize benefits User ID: Password: Open Enrollment (List Dates) myCignaplans.com user guide available on Fuse 7722 – feel free to insert slides or use as standalone presentation Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2013 Cigna

"Cigna" is a registered service mark and the "Tree of Life" logo and “GO YOU” are service marks of Cigna Intellectual Property, Inc., licensed for use by Cigna Corporation and its operating subsidiaries. All products and services are provided by such operating subsidiaries and not by Cigna Corporation. Such operating subsidiaries include Connecticut General Life Insurance Company, Cigna Health and Life Insurance Company, and HMO or service company subsidiaries of Cigna Health Corporation and Cigna Dental Health, Inc. All models are used for illustrative purposes only. 06/ © 2013 Cigna. Some content provided under license.

YOUR Cigna CHOICE FUND ® HEALTH SAVINGS ACCOUNT

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