1. Retiree Health Benefits Program Medicare Part D and Your State Benefits Your Benefits Choices

2. We Will Look At… The good news! The good news! Basic Medicare Part D Basic Medicare Part D Your choices under the Retiree Health Benefits Program Your choices under the Retiree Health Benefits Program Actions you need to take and when Actions you need to take and when

3. The Good News State program’s new prescription drug option applies the value of Medicare Part D Lower premiums and more flexibility

4. Basic Medicare Part D Passed Congress in 2003 and takes effect on Jan. 1, 2006 Passed Congress in 2003 and takes effect on Jan. 1, 2006 Provided by Medicare-approved Prescription Drug Plans (PDPs) Provided by Medicare-approved Prescription Drug Plans (PDPs) Enrollment period is November 15, 2005 – May 15, 2006 Enrollment period is November 15, 2005 – May 15, 2006 You enroll in a PDP, can switch each year You enroll in a PDP, can switch each year

5. Basic Medicare Part D Coverage includes a formulary, or list of drugs covered by the plan Coverage includes a formulary, or list of drugs covered by the plan Some drug categories are not covered, for example Some drug categories are not covered, for example  Drugs for symptomatic relief of cough and colds  Drugs used for cosmetic purposes  Drugs for weight loss or weight gain  Barbiturates

6. Basic Medicare Part D Drug Expense You Pay (Covered Drugs) Potential OOP $0 - 250 $0 - 250Deductible$250 $250 - 2,250 $250 - 2,250 25% Coinsurance $500 $2,250 - 5,100 $2,250 - 5,100 100% Coinsurance $2,850 $5,100+ $5,100+ 5% Coinsurance/$2/$5 5% of Unknown National Average Estimated Monthly Premium = $32.20 Adjusted Each Year for Inflation

7. The State Program and You This Means…. Lower premiums and more flexibility! Lower premiums and more flexibility!

8. Retiree Health Benefits Program State Enhanced Medicare Part D Benefit Incorporates Part D value into state program Incorporates Part D value into state program Enhances Part D benefit Enhances Part D benefit

9. Retiree Health Benefits Program State Enhanced Medicare Part D Benefit Broad formulary includes generic, preferred brand and non-preferred brand drugs Broad formulary includes generic, preferred brand and non-preferred brand drugs Low copayments for generic and preferred brand drugs Low copayments for generic and preferred brand drugs Protection through the“donut hole” ($2,250 - $5,100) in Basic Part D Protection through the“donut hole” ($2,250 - $5,100) in Basic Part D

10. Retiree Health Benefits Program State Enhanced Medicare Part D Benefit Administered by Medco Health Solutions, Inc. Administered by Medco Health Solutions, Inc.  Medco national prescription drug network No deductible for generic drugs No deductible for generic drugs Drug tiers based on type and cost Drug tiers based on type and cost

11. Retiree Health Benefits Program State Enhanced Medicare Part D Benefit Per Day Supply Generic Drugs Tier 1 Preferred Brand Tier 2 Non-Preferred Brand Tier 3 Specialty Drugs Tier 5 No deductible **$250 deductible applies** 30 days retail You pay $4 $4 You pay You pay$17 75% You pay 25% 90 days mail order You pay $4 $34 75% 25%

12. Retiree Health Benefits Program State Plans with Enhanced Medicare Part D Benefit Starting January 1 State Plans with Enhanced Medicare Part D Benefit Starting January 1  Advantage 65  Advantage 65 + Dental/Vision  Option I  Option II  Option II + Dental/Vision Same medical coverage as today Same medical coverage as today New enhanced Part D coverage New enhanced Part D coverage

13. Retiree Health Benefits Program New Medical-Only Plans Starting January 1 New Medical-Only Plans Starting January 1  Advantage 65 Medical-Only  Advantage 65 Medical-Only Plus Dental/Vision Include same medical (and dental/vision) benefits as today Include same medical (and dental/vision) benefits as today No prescription drug coverage No prescription drug coverage

14. Retiree Health Benefits Program Plan 2005 Premium 2006 Premium Increase/ Decrease Advantage 65 (includes drug) $293$220($73) Advantage 65 + Dental/Vision (includes drug) $320$249($71) Option I (includes drug)* $259$183($76) Option II (includes drug)* $317$259($58) Option II + Dental/Vision (includes drug)* $344$288($56) Advantage 65 – Medical Only N/A$117($176) Advantage 65 – Medical-Only + Dental/Vision N/A$146($174) Total Premiums *No new enrollees

15. Retiree Health Benefits Program State Enhanced Medicare Part D Benefit Vs. Other Drug Plan Choices Gather information Gather information Compare costs Compare costs Check formularies Check formularies Convenience Convenience Peace of Mind Peace of Mind Choose the plan that is best for you! Choose the plan that is best for you!

16. Retiree Health Benefits Program What Do I Need to Do? Review the notification materials carefully, then choose one: Review the notification materials carefully, then choose one:  Do nothing and remain in your current plan with the Enhanced Part D Drug Benefit  Select a state medical-only plan and re-enroll in a separate Part D plan (no return to state drug coverage in the future)  Cancel state program coverage  If you cancel state program coverage, you cannot return

17. Retiree Health Benefits Program What Do I Need to Do? Use the special enrollment form in your notification package to make a choice: Use the special enrollment form in your notification package to make a choice:  Enroll in a Medical-Only Plan  Cancel state program coverage  Switch from Option I, Option II to Advantage 65 plans  Take other permitted enrollment actions

18. Retiree Health Benefits Program What Do I Need to Do? Return form by November 30, 2005 Return form by November 30, 2005 Provide Medicare Claim Number (if appropriate – see form) Provide Medicare Claim Number (if appropriate – see form) If your form is not received by November 30, you default to your current plan with state Enhanced Medicare Part D If your form is not received by November 30, you default to your current plan with state Enhanced Medicare Part D

19. Retiree Health Benefits Program Getting Assistance State Medicare-coordinating prescription drug coverage State Medicare-coordinating prescription drug coverage  Medco:  1-800-572-4098  Medco Medicare Part D Plan quick link: www.dhrm.virginia.gov/hbenefits/retirees/ medicareretiree.html www.dhrm.virginia.gov/hbenefits/retirees/ medicareretiree.html

20. Retiree Health Benefits Program Getting Assistance Medicare Part D plans (not associated with the state program) Medicare Part D plans (not associated with the state program)  Medicare:  1-800-Medicare  www.medicare.gov www.medicare.gov

21. Medicare Part D and Your Benefits Thanks for listening! Now’s the time to ask questions Make the right choice for you!