1. 2013 Employee Benefits Presentation Annual Enrollment Plan Year: January 1, 2013 – December 31, 2013

2. Our insurance plans are designed to help you attain the health and dental services you need on a regular basis as well as to protect you against a catastrophic financial loss in the event of a serious health condition, disability or death. They represent a significant part of the total compensation package you have with Hoffman & Hoffman, Inc. Please review the employee benefits package carefully, and don’t hesitate to ask questions. 2

3. Overview ● Introduction ● Medical Plan – Payroll Deductions – Medical Benefits/Features – Claims Examples – HSA’s ● Other Benefits – Consult-A-Doctor – Health Advocate – Dental – Life – Disability – Flexible Spending ● Things to Remember ● What’s Next 3

4. Introductions – H&H & Senn Dunn 4 Three ways to get help when you need it: 1.Human Resources 2.Senn Dunn Insurance 3.HealthAdvocate (24/7 - starting 1/1/2013) Teresa Long Account Manager Direct: 336-544-6829 tlong@senndunn.com

5. Annual Open Enrollment 5  Benefits start over January 1, 2013  This is the time of year to make changes  Everyone enrolled in either Medical plan and/or either Dental plan, will get new ID Cards  If your change requires any additional information, HR will let you know.

6. Medical Payroll Deductions 6 Monthly Rates HSA Plan Traditional Plan Employee Only$ 45.00$ 76.30 Employee + Spouse$ 425.00$ 654.00 Employee/ Child(ren)$ 350.00$ 545.00 Family$ 575.00$ 880.72 Tax-Advantaged Options Hoffman & Hoffman, Inc. HSA Contribution Employee Can Participate in FSA $160 in Jan and then $40.00/mo Feb-Dec = $600/yr You can also set aside more You can set aside up to $2,500 pre-tax to save for out of pocket medical costs

7. Medical Plan Benefits 7 Benefit Overview HSA PlanTraditional Plan Medical Individual Deductible Family Deductible Coinsurance Individual Coinsurance Maximum Family Coinsurance Maximum Individual Out-of-Pocket Maximum Family Out-of-Pocket Maximum Lifetime Maximum $1,500* $3,000* 20% $3,000 $6,000 $4,500 $9,000 Unlimited $1,000 $3,000 20% $3,000 $9,000 $4,000 $12,000 Unlimited Physician Services Primary Care Office Visits Specialist Office Visits Ded then 20% Coinsurance $25 Copay $40 Copay Wellness & Preventive Routine Physical Exams Routine Eye Exams Pap/ Mammograms/ PSA Immunizations Colonoscopies (Preventive Only) 100% Covered * On HSA Plan, Family Deductible is Non-Embedded.

8. Medical Plan Benefits 8 Benefit Overview HSA PlanTraditional Plan Lab and X-Ray In Office Out of Office MRI, CAT & PET Ded then 20% Coinsurance $25 / $40 Copay Ded then 20% Coinsurance Inpatient Services Physician Hospital Ded then 20% Coinsurance Outpatient Services Physician Hospital Ded then 20% Coinsurance Other Services Emergency Room Services Urgent Care Co-pay Chiropractic Care Ded then 20% Coinsurance $150 Copay $ 40 Copay

9. Prescription Drug Benefits 9 Benefit Overview HSA PlanTraditonal Plan Prescription Drugs (30-day supply) Many Preventive Generics Tier 1 (Generic) Tier 2 (Preferred Brand) Tier 3 (Non-Preferred Brand) Tier 4 (Specialty Rx) Many Covered 100% Ded then 20% Coinsurance Many Covered 100% $ 4 Copay $ 25 Copay $ 40 Copay $250 Copay Mail Order (90-day supply) Tier 1 (Generic) Tier 2 (Preferred Brand) Tier 3 (Non-Preferred Brand) Tier 4 (Specialty Rx) Ded then 20% Coinsurance $ 8 Copay $50 Copay $80 Copay $500 Copay

10. Health Savings Account ● Who can have an HSA? ● Who contributes to my HSA? ● How much can I contribute? ● How is an HSA like an FSA? How is it different? ● Are their fees associated with an HSA? 10 Hoffman & Hoffman, Inc. will contribute $600/yr

11. Claims Example: Preventive Exam HSA Plan Traditional Plan Office Visits100% paid HSA annual contribution$600N/A Spends out-of-pocket$0 Annual payroll deduction$540$915.60 Final Annual EE out-of-pocket (total paid for care & premium) $540, and you have $600 in your Health Savings Account $915.60 11 Employee Only Coverage ● Fairly healthy individual whose only medical care for the year was a preventive exam with a primary care physician ● $750 annual exam TOTAL Cost = $750 Could have saved $375.60 and still have $600 in HSA Account

12. Claims Example: Common Illness HSA Plan Traditional Plan Deductible$205N/A CoinsuranceN/A Office Visits$160$50 copays Rx$45$12 copays Spends Out-of-pocket$205$62 copays - HSA annual contribution-$600N/A Total paid for Care $0 ($205 from HSA) $62 Annual payroll deduction$540$915.60 Final Annual EE out-of-pocket (total paid for care & premium) $540 ($395 left in HSA) $977.60 12 Employee Only Coverage ● Overall healthy individual with a couple sick care office visits and prescriptions throughout the year (e.g., sinus infection, strep throat) ● $160 annually in office visits – Estimated 2 office visits (not preventive) at contracted rate of $80 each ● $45 annually in Rx – Estimated 3 generic medications at $15 each TOTAL Cost= $205 Could have saved $437.60 and still have $395 in HSA Account

13. Claims Example: Common Illness HSA Plan Traditional Plan Deductible$750N/A CoinsuranceN/A Office Visits$480$150 copays Rx$270$99 copays Spends Out-of-pocket$750$249 copays - HSA annual contribution-$600N/A Total paid for care $150 ($600 from HSA) $249 Annual payroll deduction$6,900.00$10,568.64 Final Annual EE out-of-pocket (total paid for care & premium) $7,050.00$10,817.64 13 Family Coverage ● Overall healthy family with a few sick care office visits and prescriptions throughout the year (e.g., sinus infection, strep throat) ● $480 annually in office visits – Estimated 6 office visits (not preventive) at contracted rate of $80 each ● $270 annually for Rx – Estimated 6 generic medications at $15 each – Estimated 3 preferred brand name medications at $60 each TOTAL Cost = $750 Could have saved $3,767.64

14. Claims Example: Chronic Condition Employee Only Coverage ● Chronic condition such as high blood pressure or diabetes that requires several office visits and medications throughout the year ● $1360 annually for office visits – Estimated 8 office visits (2 PCP average $80 each & 6 specialist average $200 each ● $4080 annually for Rx – Estimated 4 monthly preferred brand average $60 each & 1 monthly non-preferred brand average $100 each TOTAL Cost = $5,440 14 HSA Plan Traditional Plan Deductible$1,500N/A CoinsuranceN/A Office Visits$1,360$290 copays Rx $928 ($140 remaining Ded then $788 Coins) $1,680 copays Spends out-of-pocket$2,288$1,970 copays - HSA annual contribution-$600N/A Total paid for care $1,688 ($600 from HSA) $1,970 Annual payroll deduction$540$915.60 Final Annual EE out-of-pocket (total paid for care & premium) $2,228.00$2,885.60 Could have saved $657.60

15. Claims Example: Chronic Condition Family Coverage ● Chronic condition such as high blood pressure or diabetes that requires several office visits and medications throughout the year ● $2,720 annually for office visits – Estimated 16 office visits (4 PCP, average $80 each & 12 SPC average $200 each ● $8,160 annually for Rx – Estimated 8 monthly preferred brand average $60 each & 2 monthly Non-preferred brand average $100 each TOTAL Cost = $10,880 15 HSA Plan Traditional Plan Deductible$3,000N/A CoinsuranceN/A Office Visits$2,720$580 copays Rx $1856 ($280 remaining Ded then $1576 Coins) $3,360 copays Spends Out-of-pocket$4,576$3,940 copays -HSA annual contribution-$600N/A Total paid for care $3,976 ($600 from HSA) $3,940 Annual payroll deduction$6,900.00$10,568.64 Final Annual EE out-of-pocket (total paid for care & premium) $10,876$14,508.64 Could have saved $3,632.64

16. Which plan is right for me? ● Consider general health, family history, and historical utilization ● Consider your monthly prescription costs 16

17. Other Benefits ● Consult-A-Doctor ● Health Advocate ** New Benefit ● Voluntary Dental – now Reliance Standard, small increase ● Life/Disability – now Reliance Standard, Open Enrollment – Rates will only change if you make a change or move to the next Age Bracket ● FSA – now Stanley Benefits – Lower Healthcare max ($2,500) – Health Care FSA (cannot be used with HSA Plan) – Dependent Care FSA (can be used with BOTH plans!) 17

18. Consult-A-Doctor 18 ● 24/7 telephonic access to physicians at no cost to you ● Available to all employees, enrolled in medical or not ● Can cover 5 dependents ● When to use: – For non-emergent, common conditions – When you can’t miss work – After hours or on weekends – When you are traveling – When you need a prescription or refill – REGISTER ASAP IF YOU HAVENT ALREADY: then its ready when you need it Available to those enrolled on either of the 2 medical plans

19. Health Advocate 19 Available to those enrolled on either of the 2 medical plans

20. Dental Plan Benefits: ** Now Reliance Standard 20 Benefit Overview Low PlanHigh Plan Benefit Maximum Per Year $1000 per Member Preventive Care Routine Exam, 2 Cleanings per Year, Flouride Treatments and Emergency Pain Relief Covered 100% of Usual & Customary Deductible $50 Individual or $150 Family max Basic Services Diagnostic X-Rays, Fillings, Extractions Benefits are paid at 80% of Usual & Customary Pricing Major Services Endodontics, Oral Surgery, Periodontics, Crown, Bridges, Dentures Not Covered Benefits are paid at 50% of Usual & Customary Orthodontia Not Covered Covered at 50% up to a lifetime Maximum coverage of $1000 Waiting Period None on any services as long as you enroll when 1 st eligible or at Annual Open Enrollment

21. Basic Company Paid Life & AD&D ** now Reliance Standard 21 1x Salary to $50,000

22. Supplemental Life ** now Reliance Standard 22 Employee Life You can elect coverage in $25,000 increments up to $100,000, not to exceed 5 x your salary ** New Benefit: Spouse Amount Spouse can elect $10,000 increments up to 50% of the employee’s elected amount to a maximum of $50,000 ** New Benefit: Child Amount:$10,000 Guaranteed Issue Employee: $100,000 Spouse: $20,000 This is a true open enrollment period for the Supplement Life: You may elect up to $100,000 on yourself or increase the Vol Life you already have on yourself up to $100,000 with no questions. You may also now elect Spousal Life up to $20,000 and Child Life of $10,000 with no questions.

23. Voluntary Short-Term Disability ** new benefit Reliance Standard 23 Monthly Benefit 60% of your salary to a maximum weekly benefit of $1,250/week Benefits Begin31st day after injury or illness Maximum Benefit Period180 days This is a true open enrollment period for Voluntary Short-Term Disability

24. Voluntary Long-Term Disability ** now Reliance Standard 24 Monthly Benefit 60% of your salary to a maximum monthly benefit of $3,000/month Benefits Begin6-months after injury or illness Maximum Benefit PeriodADEA (retirement) This is a true open enrollment period for Voluntary Long-Term Disability

25. 25 A flexible spending account (FSA) allows you to set aside pre- tax dollars for out-of-pocket medical, dental, vision and dependent care expenses We are talking about money you are already spending, so let’s avoid some taxes!! ● Dependent Care FSA – Maximum – $5,000 – Funds are only available as they are taken out of your paycheck – Everyone is eligible to participate Flexible Spending Accounts ** now Stanley Benefits

26. 26 ● Health Care FSA – Maximum – $2,500 – Full amount is available at the beginning of the plan year ● “Use It or Lose It” Rule ● Debit Card – gives you immediate access to your spending account without paying out of pocket and waiting for reimbursement ● Card will track receipts but always good idea to keep your receipts anyway Flexible Spending Accounts ** now Stanley Benefits Lower 2013 Max

27. 27 Health Care FSA: You are eligible if you enroll in the Traditional Plan or waive coverage  Eligible expenses include:  Doctor office visit co-pays  Prescription drug co-pays  Dental services  Orthodontia  Eye glasses  Contacts and lens solution  Eye surgery Flexible Spending Accounts Stanley Benefits

28. 28 Everyone will receive a Personalized Open Enrollment Form which will be pre-filled with your current 2012 elections All you will need to do is check “Keep my election the same” under each benefit, medical, dental, etc, or check the box to “Change my Election” and indicate the coverage you wish to have for 2013. These forms must be turned in by Friday, December 7 th ! H&H employees turn in to Amanda Harton. HBT employees turn in to Christine Flowe. Personalized Enrollment Form

29. Things to remember: ● Everyone must turn in their personalized Open Enrollment Form by Friday, December 7 th. (H&H to Amanda and HBT to Christine) ● If moving to HSA Plan, you should open an HSA bank account so that you can contribute but also receive the Hoffman & Hoffman, Inc. monthly contribution. See Amanda or Christine for details. ● If you are on the Traditional plan, utilize FSA through Stanley Benefits ● Everyone must turn in a 401(k) election form by Friday, December 14 th. ● This has been a summary overview of employee benefits provided/offered by Hoffman & Hoffman, Inc. – See Plan Documents for details ● Call Senn Dunn if you have any questions 800-598-7161, Teresa Long ● Questions ??????? 29 Deadline: 12/7/12