1. AON CONFIDENTIAL / AON INTERNAL USE ONLY Dependent Eligibility Verification Audit Discussion Summary March 2011

2. 2 2 Why Conduct a Dependent Eligibility Audit Campaign? On average, 4% to 8% of dependents covered by an employer’s health plan are ineligible for benefits 80% children and 20% spouse Reduction in dependents The average cost for a dependent covered by a health plan is approximately $3,400 per person. Client ROI on average can range from 10:1 to 25:1 and higher Managing healthcare costs* Employers have a duty to monitor plan operations and to ensure that plan funds are only authorized for those employees who are eligible for coverage by the health plan ERISA, Sarbanes-Oxley Fiduciary responsibilities Impact Area Key Insights *Aon trend survey 2008

3. 3 3 Why Do Employers Have Ineligible Dependents Enrolled? Changes of internal eligibility processes and procedures Poor understanding about eligibility requirements Multiple acquisitions and divestitures, leading to multiple plans and eligibility criteria Shortage of internal HR resources to manage and/or conduct periodic audits of dependents

4. 4 4 Examples of Ineligible Dependents Divorced spouses Grandchildren or other extended family dependents under no legal guardianship Unmarried partners with no recognized relationship under the plan Married children Children not residing with the participant in a parent/child relationship Children of live-in partners with no legal relationship Over-age dependents (not disabled) Step-children following divorce of the biological parent

5. 5 5 Document – Model Audit Process is Best Practice Approach is extremely effective and requires documentation from employees Requires 12 to 16 weeks to complete the outreach campaign Campaign requires all employees to provide proof of dependents’ eligibility (e.g., marriage certificate, birth certificate) Significant savings achieved – virtually 100% accurate, eliminating ineligible dependents  Plan savings are usually 5% to 10% reduction in dependent spend

6. 6 6 Value Can Be Measured Along Several Dimensions Removal of Ineligible dependents 1 Conduct document audit to identify ineligible dependents 2% to 10% reduction in dependent spend Improvement to Internal eligibility management process Implement internal process for new hires and dependent adds to require eligibility verification documentation Alleviates or reduces disbursement of health plan dollars to ineligible dependents 2 Compliance with Federal requirements Align plan management with ERISA fiduciary responsibilities and Sarbanes-Oxley Reduces liability of fiduciaries, civil lawsuits, and plan administrator’s personal liability for breaches 3 IMPACT AREAAPPROACHPOTENTIAL