PENSION PLAN SUMMARY PLAN DESCRIPTION. Effective January 1, 2013 St.Vincent Health. St. Mary s

Transcription

1 PENSION PLAN SUMMARY PLAN DESCRIPTION Effective January 1, 2013 St.Vincent Health St. Mary s For associates who were Current Employees on December 31, 2005

2 PLAN OUTLINE St.Vincent Health Evansville, IN Official Plan Name Ascension Health Pension Plan Effective Date Jan. 1, 2013 Freeze Date This Plan was frozen as of Dec. 31, Who Participates Transition Effective Date Percentages Used in Determining Your Benefit Amount rmal Retirement Benefit if you were a Current Employee on the day before the Transition Effective Date Early Retirement You will not lose any benefits you earned through Dec. 31, 2012 if you are Vested in the Plan. For Participants who are not yet Vested, you may continue earning Vesting Service. Although you will not earn future benefits in the Pension Plan, the lump-sum value of your benefit will increase as your age increases, and it will stay in the Pension Plan until you are eligible for distribution. An Employee who met the eligibility requirements of the Pension Plan prior to Jan. 1, 2013, and accrued a benefit in the Plan; typically, this means an Employee who was a Current Employee on Dec. 31, Jan. 1, 2006 P% = 5.75% T% = 2.50% At normal retirement, your Pension Plan benefit will be made up of: The lump-sum value of the Accrued Benefit that you earned through the day before the Transition Effective Date, which became your Opening Balance on the Transition Effective Date, updated thereafter as your HAE increased up to the Freeze Date, and The benefit you earn after the Transition Effective Date under the lump-sum formula, which will be equal to: - P% times your HAE for each year of Credited Service after the Transition Effective Date and before the Freeze Date, plus - T% of your HAE over the Integration Level for each year of Credited Service after the Transition Effective Date and before the Freeze Date. Then the total will be multiplied by your Age Adjustment Factor to determine the current value of your benefit. You may receive your benefit as early as age 55, if you are Vested and have terminated your employment with all Health Ministries of Ascension Health. Alternatively, you may leave your benefit in the Pension Plan and allow it to grow, as your age 1

3 You Must Be Vested to Receive a Benefit Benefit Payment Options Additional Option if You Continue Working After Age 65: This Plan Did t Require Employee Contributions Steps to Take as You Get Ready to Retire increases, until age 65 (or earlier). However, if the value of your Vested benefit is less than $5,000, the small benefit automatic distribution provisions described in Section 4 will apply. You are Vested in (or are entitled to) your benefit from the Pension Plan after you earn 5 years of Vesting Service (that is, after you work at least 1,000 Hours in each of 5 years). If you are an active Participant when you reach age 65, you are entitled to a pension benefit regardless of your years of Vesting Service. At retirement, you will have the flexibility of receiving your benefit in one lump-sum payment or in one of several monthly payment options, including: Single Life, Joint and Survivor Options, Single Life with Cash Refund, and cost-of-living options. If you wish to continue working beyond age 65, you have the flexibility of receiving your pension benefits while you are still employed with a Participating Institution or an Associated Entity. The Pension Plan s benefits are funded solely by your employer. Employer contributions are actuarially determined and held in an Ascension Health trust reserved solely for purposes of paying Pension Plan benefits and maintaining the Pension Plan. Please contact Pension Services three months before you want your benefit to start to request an estimate and paperwork. INEVA , 006, 009, 012, 013, 115, 200 2

4 YOUR CONTACT INFORMATION For Questions about Your Benefits Pension Service Center To speak with a representative, call , option 3 Or Send an to: pensionservices@ascensionhealth.org Or Send correspondence to: Ascension Health Pension Services Borman Drive, Suite 200 St. Louis, MO Or P.O. Box St. Louis, MO For General Plan Information and Retirement Planning Tools and Resources 3

5 CONTENTS Plan Outline... 1 Your Contact Information... 3 Contents... 4 Glossary... 5 Introduction Participation and Vesting Participant Vesting Breaks in Service Naming a Beneficiary Your Benefit Benefits for Current Employees on the Transition Effective Date A Closer Look at Service, Earnings, and Age Minimum Lump-Sum Benefit If You Had a Match Account as of the Transition Effective Date Receiving Your Retirement Benefits If You Retire If You Terminate Employment Forms of Payment Distribution of Small Benefits Tax Highlights Other Situations If You Die Before Benefit Distribution If You Become Disabled If You Retire and Return to Work If You Terminate Employment and Are Later Rehired If You Take a Leave Of Absence (Other Than Military) Uniformed Services Rights (Leave of Absence Due to Military Service) If You Transfer Employment If You Receive a Domestic Relations Order Other Plan Provisions Employee Contributions Plan Termination Plan Administrator Claim Procedures Submitting a Claim Appealing a Claim Plan Information Appendix

6 GLOSSARY You may find it helpful to refer to this glossary for definitions of specific terms that are used in this summary. Account Based Benefit Accrued Benefit Associated Entity Age Adjustment Factor Commonly called Match Account, a benefit based on employer Matching Contributions credited under the Plan before the Transition Effective Date, plus interest. The pension benefit you have earned as of a particular date. Any entity specifically designated as an Associated Entity by your Health Ministry in the Plan documents. Contact Pension Services if you need to know if a particular institution is an Associated Entity. A factor that adjusts the lump-sum benefit payable at age 55, as defined by the formula, so that it reflects the value of the benefit at your specific age. Annualized Earnings Annualized Hours Authorized Plan Representative Beneficiary Benefit Distribution Date Break in Service Earnings are annualized if Hours in the calendar year are at least 500 Hours and less than 1,872. The number is calculated by dividing the actual Earnings in a year by the number of actual Hours in the year, then multiplying by 1,872. For example, if you worked 700 Hours in the calendar year and earned $30,000, your Annualized Earnings would be: $30, = x 1,872 = $80,229. A number calculated by dividing the actual Hours worked in a period of time by the number of completed months in the period of time, then multiplying by 12. For example, if you were hired June 1, 2002, and worked 700 Hours in the 7 months from June through December, your Annualized Hours for 2002 would be: = 100 x 12 = 1,200. An individual chosen by your Health Ministry to carry out the administrative responsibilities of the Pension Plan and serve as the main contact for your organization s Employees at the local level. Contact your Human Resources/ Benefits Department if you need to contact this individual. The person or persons (or estate or trust) designated as Beneficiary on a form provided by the Pension Committee. The date you receive your pension benefits in accordance with your election. If you elect one of the monthly payment forms, this is the date your benefits commence. Occurs when you earn less than 500 Hours during a calendar year, whether you are actively employed or not. Breaks in Service before the Transition Effective Date are determined according to the Plan provisions in effect at that time. If you are not Vested and your consecutive Breaks in Service equal or 5

7 exceed 5, then you forfeit the Vesting Service, Credited Service, and Accrued Benefit earned prior to the breaks. Conversion Factor Credited Service Credited Future Service Current Employee Earnings A factor used to convert your Accrued Benefit payable in one form to the actuarial equivalent of your Accrued Benefit paid in another form. The actuarial adjustment factors utilize the 1994 Group Annuity Mortality table (blended 80% female/20% male) and assume the following long-term rate of return: For converting the lump-sum benefit to a single life form of payment, the long-term rate of return is assumed to be 7.50% for Current Employees, and 4% for new employees. For converting a single life form of payment to any other optional lifetime benefit payment form, the interest rate is assumed to be 7.50%. The total of Transition Credited Service and Credited Future Service; this is the service used to determine the amount of your Pension Plan benefits. The service after the Transition Effective Date through 2012 used to determine the amount of your benefit under the Pension Plan. In general, you earned a full year of Credited Service for each year between the Transition Effective Date and 2012 in which you worked 1,872 or more Hours. If you worked at least 500, but less than 1,872 Hours in a calendar year, you earned a partial year of Credited Service equal to your Hours divided by 1,872. You earned no Credited Service if you worked less than 500 Hours. Any Employee who is in the employ of a Participating Institution on the day prior to his Participating Institution s Transition Effective Date; or Any Employee who has Credited Service under the Pension Plan or any defined benefit plan of any entity that is part of the Ascension Health retirement program and who has not yet lost Credited Service under the Break-in-Service rules of that defined benefit plan. This is your pay such as base, overtime, shift differential, on-call and other performance-related pay and incentives plus amounts you elect to defer on a before-tax basis to: The Ascension Health Retirement Savings Plan (Section 403(b) and 401(a) plans), A Section 125 plan (cafeteria plan), or A Section 457(b) plan (elective deferrals). Examples of amounts excluded from Earnings are: PTO cash-outs whether voluntary or involuntary Hiring, referral, retention and other non-performance related bonuses and reimbursements 6

8 Imputed income (for example, imputed income on life insurance above $50,000) Severance pay Section 457(f) and Section 451 plan deferrals and distributions See the Appendix for more details about amounts that are included and excluded from Earnings. A federally mandated earnings limitation is in effect. For 2012 (the year in which the Pension Plan was frozen), the earnings limitation was $250,000. This means that your pay in excess of this limit will not be included in determining your Highest Average Earnings (HAE). If you were paid a differential wage payment for any period between Jan. 1, 2009 and Dec. 31, 2012 during which you were performing qualified military service while on active duty for a period of more than 30 days, that payment is included in determining your HAE. If you participated in a pension plan that was merged into this Pension Plan, Earnings for the years you were covered by that plan are determined according to the rules of the Prior Plan. Please contact your Human Resources/Benefits Department for more information. Eligibility Service Employee Freeze Date Grandfathered Employee Guaranteed Interest Rate Highest Average Earnings (HAE) The period or periods of employment of an Employee by one or more Participating Institutions or Associated Entities. Any person who is employed by and who receives Earnings from a Participating Institution or Associated Entity unless such person is an independent contractor. Leased employees and associates covered by a collective bargaining agreement that does not specify the Pension Plan as its pension plan are considered Employees but did not become Participants in the Pension Plan as long as they were leased employees or union employees. Dec. 31, 2012 the date that benefit accruals were frozen. Any Employee, former Employee, or disabled Participant whose eligibility and benefit accruals are not frozen. At this time, there are no individuals who fall under this definition. The rate of interest credited to your Match Account that is an amount declared at the end of the year for the upcoming year, but is guaranteed to be no less than 5% per annum. This is the average of your highest 5 consecutive calendar years (500 Hours or more) of Earnings during your last 10 years of employment up to the Freeze Date with a Participating Institution or an Associated Entity. Earnings are annualized if Hours worked in a calendar year are at least 500 Hours and less 7

9 than 1,872 Hours. Earnings in years of less than 500 Hours are ignored. Years of less than 500 Hours are also ignored in counting the last 10 years of employment. Hours Hours you work and for which you receive pay plus certain hours you do not work, for example: vacation, holiday, sick leave, Leaves of Absence, military leave, hours for which back pay is awarded, and certain periods of disability. Excluded from Hours of Service are: Hours related to pay that is excluded from Earnings (see above and the Appendix) On-call hours Low census hours (if you are paid not to report to work) Integration Level Match Account Matching Contributions rmal Retirement Age rmal Retirement Date Opening Balance Opening Balance Percentage A specified level of Earnings over which the Pension Plan provides an additional benefit. The Integration Level is adjusted annually based on changes to the Consumer Price Index (CPI), except the amount is rounded down to the nearest $1,000. The Integration Level applicable to employment terminations in 2012, the year in which the Pension Plan was frozen, was $73,000. The Account Based Benefit is commonly called a Match Account. It consists of your annual employer Matching Contributions plus interest as of the day before the Transition Effective Date, plus additional interest credited until you become eligible for and elect a distribution. The amount that your employer elected to credit to your Account Based Benefit in the Pension Plan through the day before the Transition Effective Date. Age 65. The first of the month following the date you terminate employment (or the date of termination if it is on the first day of a month) because of normal retirement at or after you attain rmal Retirement Age. Your lump-sum benefit as of the day before the Transition Effective Date. If you had an Accrued Benefit on the day before the Transition Effective Date, this is the result of dividing your Opening Balance by your Highest Average Earnings (HAE) as of the day before the Transition Effective Date. This percentage will then be multiplied by your HAE as of the earlier of your termination date or the Freeze Date. 8

10 Participant Participating Institution Pension Plan Plan Administrator Pre-retirement Death Benefit Prior Plan Spousal Consent Spouse Total Plan Distribution Transition Credited Service Transition Effective Date Vested Vesting Service Vesting An Employee who met the eligibility requirements of the Pension Plan prior to Jan. 1, 2013, and accrued a benefit in the Plan, whether or not the Employee is Vested. Ascension Health and all other institutions which adopt the Plan. The Pension Plan administered by Ascension Health. Also referred to as Plan. The Ascension Health Pension Committee, who is responsible for constructing, interpreting and administrating the Pension Plan in a uniform and nondiscriminatory manner. Benefits that may be payable if you die before receiving any benefits from the Pension Plan. A plan that was sponsored by a Participating Entity before the Pension Plan. The written and witnessed agreement of your Spouse, which is required if you are married and wish to name someone other than your Spouse as Beneficiary. Effective Sept. 16, 2013, a person who is validly married to a Participant in accordance with the laws of the state in which such individuals were married. A lump-sum payment of all benefits due; no further benefits are due or payable. The Participant s Credited Service as of the Transition Effective Date. The date a Participating Institution elected to convert benefits to the new Pension Plan design, including changing the formula so that it defines a lump-sum benefit payable at age 55 instead of a lifetime benefit commencing at age 65. Your status under the Pension Plan once you have satisfied the Vesting requirements. The years that are credited to you for the purpose of determining your entitlement to various benefits under the Pension Plan. You earn 1 year of Vesting Service when you have completed 1,000 Hours in a calendar year. Your ownership of, or right to receive, the benefit you earn as a Participant in the Pension Plan. You become Vested under the Pension Plan after 5 years of Vesting Service, or when you turn age 65 and still are an active Participant. 9

11 SECTION 1: INTRODUCTION As of Dec. 31, 2012, benefit accruals and eligibility under the Pension Plan were frozen. As a result, you stopped accruing additional pension benefits as of this date, including Credited Service. You or your refers to the Participant. However, you will not lose any benefits Days refers to calendar days. that you have earned if you are Vested in the Plan. And, if you were not Vested on the Freeze Date, you continue to earn Vesting Service. Although you will not earn future benefits in the Pension Plan, the lump-sum value of your benefit will increase as your age increases, and it will stay in the Pension Plan until you are eligible for distribution upon retirement. This Document Is a Summary The information in this Summary Plan Description (SPD) is intended to serve as a summary of the Pension Plan as restated effective Jan. 1, 2012, and amended effective Dec. 31, You should refer to the official Plan document for details. If there are any discrepancies between the information in this SPD and the official Plan document, the terms of the Plan document will prevail. This SPD does not constitute a contract of employment or a guarantee of benefits or future employment. In addition, your participation in the Pension Plan should not be construed as an employment contract. The following pages summarize provisions that generally apply to all Health Ministries that offer the Pension Plan. The Plan Outline, at the front of this SPD, contains specific requirements and provisions that apply to your Health Ministry. 10

12 SECTION 2: PARTICIPATION AND VESTING Participant You are a Participant if you are an Employee who met the eligibility requirements of the Pension Plan prior to Jan. 1, 2013, and accrued a benefit. If you were not a Participant in the Pension Plan before the Freeze Date, you cannot become a Participant. Vesting Vesting refers to your ownership, or right to receive, the benefits you earn as a Participant in the Pension Plan. Are you Vested? You become Vested, that is, entitled to a nonforfeitable benefit, after 5 years of 1,000 Hours in each calendar year. If you reach age 65 while an active Participant, you become Vested regardless of your years of Vesting Service. You earn 1 year of Vesting Service for each calendar year in which you are credited with at least 1,000 Hours with a Participating Institution or an Associated Entity. Your Vesting Service under the Prior Plan will count toward your Vesting Service in this Plan. If you were not Vested on the Freeze Date, you will become Vested in your Accrued Benefit after earning 5 years of Vesting Service, or when you reach age 65, provided you are an active Participant at that time. You are also entitled to Vesting Service for your period of employment prior to the date your Participating Institution adopted the Pension Plan, and may be entitled to Vesting Service for your period of employment with an employer that was acquired by your Participating Institution. This Vesting Service will be calculated according to the conditions set forth by your employer upon adoption of the Pension Plan. If you are not Vested upon termination of employment, you are not entitled to a benefit. Disabled Participants who did not meet the Vesting requirements of the Plan as of Dec. 31, 2012 automatically became Vested in their benefits earned through the end of Breaks in Service You incur a 1-year Break in Service if you earn less than 500 Hours during a calendar year, whether or not you are actively employed or have terminated employment. 11

13 If you have 5 or more consecutive Breaks in Service at a time when you are not Vested, your years of Vesting and Credited Service are forfeited. Breaks in Service before the Transition Effective Date are determined according to the provisions of the Plan in effect before that date. Naming a Beneficiary A Pre-retirement Death Benefit is payable in the event of your death while an active Employee or after you terminate employment. You may designate anyone as your Beneficiary (to receive any death benefits that may be payable in the event of your death before retirement) on a form provided by the Pension Committee. If you are married, your Spouse is automatically your Beneficiary unless you name someone else. You must obtain the consent of your Spouse, in writing, in order to name someone else as Beneficiary. This Spousal Consent must be witnessed by a notary public or your Authorized Plan Representative. If you have named your Spouse as Beneficiary before benefits commence and you are subsequently divorced from that Spouse, your entire Beneficiary designation will be void. You will be required to complete a new Beneficiary designation. If there is no Beneficiary designation on file in the event of your death before retirement, benefits will be paid to your executor or administrator of your estate if you are single; however, if you are married, benefits will be paid to your Spouse. You may obtain a Beneficiary designation form from Pension Services or download a form from The completed form must be submitted to Pension Services (please see the Your Contact Information section of this SPD). At retirement, if you elect a form of payment providing survivor benefits, you must name a Beneficiary when you complete your application for retirement benefits. 12

14 SECTION 3: YOUR BENEFIT Effective Jan. 1, 2013, your Pension Plan provides a lump-sum benefit based on: Your years of Credited Service through the Freeze Date, Your Highest Average Earnings (HAE), which is the average of your highest 5 consecutive calendar years of Earnings during your last 10 years of employment, up to the Freeze Date, and Your age at the time you request distribution. For more details, see the Plan Outline located at the front of this SPD. Benefits are payable as early as age 55, following employment termination. Several monthly payment options are also available. The method of determining your benefits depends on whether your date of hire was after the day before the Transition Effective Date, or before the Transition Effective Date. Benefits for Current Employees on the Transition Effective Date At retirement, your Pension Plan benefit consists of: The lump-sum value of the Accrued Benefit you have earned through the day before the Transition Effective Date, updated thereafter as your Earnings increased before the Freeze Date, and The benefit you earned between the Transition Effective Date and the Freeze Date under the lump-sum formula. Your benefits will grow with increases in your age. In addition, your benefit will include any Account Based Benefit (commonly called a Match Account) with which you were credited as of the day before the Transition Effective Date, plus interest. This benefit will be credited separately from your lump-sum benefit. It will continue to earn interest until you become eligible for, and elect, a distribution. Benefits for Participants Employed on or after the Transition Effective Date If your date of employment with Ascension Health was on or after the Transition Effective Date, an employer contribution to the Retirement Savings Plan was made in lieu of benefits in the Pension Plan. See your Retirement Savings Plan SPD for more information. Converting Your Pension Earned as of the Transition Effective Date Your full Accrued Benefit as of the day before the Transition Effective Date, (that is, the annual lifetime benefit payable at age 65), was determined based upon the pension benefit formula and your Credited Service and HAE on the day before the Transition Effective Date. 13

15 Your Accrued Benefit as of the day before the Transition Effective Date, was converted from a monthly benefit payable at age 65 to a lump-sum amount payable at age 55. This lumpsum amount became your Opening Balance on the Transition Effective Date. When the lump-sum amount is taken as a percentage of HAE on the day before the Transition Effective Date, this creates your Opening Balance Percentage. This percentage is applied to your HAE in the future so that your Accrued Benefit on the day before the Transition Effective Date increases as your HAE increases, up to the Freeze Date. Your Pension Benefits from the Transition Effective Date to the Freeze Date You began earning benefits under the lump-sum formula on the Transition Effective Date. You will receive a pension benefit that Lump-Sum Benefit If Employed on or Before the is equal to P% of your HAE for each Transition Effective Date: year of Credited Service between the Transition Effective Date and the Freeze Date. In addition, if your HAE is above the Integration Level ($73,000 in 2012), you will receive an additional benefit of T% of your HAE over the Integration Level for each year of Credited Service between the Transition Effective Date and the Freeze Date. This accounts for the fact that Social Security does not cover earnings over a certain level. Please refer to the Plan Outline, at the front of this SPD, to see the value of the P% and T% specified by your Health Ministry for use in determining your benefit. Step One: Your Opening Balance Percentage based on your Accrued Benefit at the day before the Transition Effective Date, times your Highest Average Earnings (HAE), plus Step Two: Multiply the P% stated in the Plan Outline, at the front of this SPD, times your HAE for each year of Credited Service between the Transition Effective Date and the Freeze Date, plus Step Three: Multiply the T% stated in the Plan Outline times your HAE over the Integration Level for each year of Credited Service between the Transition Effective Date and the Freeze Date, then Step Four: Multiply the total by your Age Adjustment Factor to see the current value of your benefit The first three steps give you the lump-sum value at age 55. The last step shows you the value of your benefit at your current age. A Closer Look at Service, Earnings, and Age Credited Service After the Transition Effective Date to the Freeze Date Between the Transition Effective Date and the Freeze Date, you earned 1 year of Credited Service for each calendar year after your Participating Institution adopted the Pension Plan in which you are credited with at least 1,872 Hours with a Participating Institution. You earned no Credited Service if you worked less than 500 Hours in any calendar year. This applies to all years, including the first and last calendar year of employment, if those calendar years are after the Transition Effective Date. (If you worked less than 500 Hours, you also incurred a 1-year Break in Service, as explained in Section 1.) If you worked at least 500 but less than 1,872 Hours in a calendar year, you received a fractional year of Credited Service equal to your actual Hours divided by 1,

16 You will not earn Credited Service after the Freeze Date. (However, you may continue to earn Vesting Service after the Freeze Date.) Credited Service Before the Transition Effective Date You Continue to Earn Vesting Service You earn 1 year of Vesting Service service used to determine your nonforfeitable right to receive your benefit for each calendar year in which you work at least 1,000 Hours with a Participating Institution or Associated Entity. Your benefit for Credited Service before the Transition Effective Date, which may also be called Transition Credited Service, is represented by your Opening Balance Percentage, as described on previous pages. Your Transition Credited Service is determined based on the Plan provisions in effect before the Transition Effective Date. You may also be entitled to Credited Service prior to the date your Participating Institution adopted the Pension Plan. Such Credited Service is subject to the conditions set forth by your employer upon adoption of the Pension Plan. Highest Average Earnings (HAE) Your HAE is the average of your highest 5 consecutive calendar years of Earnings during your last 10 years of employment up to the Freeze Date with a Participating Institution or an Associated Entity. If you work at least 500 but less than 1,872 Hours in a calendar year, your Earnings are annualized by dividing your actual Earnings by your actual Hours, then multiplying by 1,872. Earnings for calendar years in which you are credited with less than 500 Hours and any Earnings after the Freeze Date are excluded. If you have less than 5 consecutive calendar years as an Employee, your HAE is the average of your actual number of consecutive calendar years prior to the Freeze Date. If you have less than 10 consecutive calendar years as an Employee, your HAE is determined using the average of your highest Earnings in whatever period you were an Employee prior to the Freeze Date. Age Adjustment Factor The Age Adjustment Factor is a factor that adjusts the lump-sum benefit payable at age 55, as defined by the formula, so that it reflects the value of the benefit at your specific age. See table on the right. Age Age Adjustment Factor* 35 years or less 20% 36 23% 37 26% 38 29% 39 32% 40 35% 41 38% 42 41% 43 44% 44 47% 45 50% 46 55% 47 60% 48 65% 49 70% 50 75% 51 80% 52 85% 53 90% 54 95% % % % % % % % % % % % 66 and over Increases another 7% each year *The factor is interpolated for complete months between ages 15

17 Minimum Lump-Sum Benefit The minimum benefit payable at age 55 under the Pension Plan is $1,200 for each year of Credited Service. This amount will be adjusted by the Age Adjustment Factor at your age when your employment terminates. In addition, you will receive any Account Based Benefit with which you are credited. If you are a Current Employee with an Accrued Benefit as of the day before the Transition Effective Date, your benefit from the Pension Plan can never be less than your benefit under the Pension Plan as of the day before the Transition Effective Date. If you have questions about how your benefit as of the day before Transition Effective Date was calculated, please refer to the SPD for the Plan in effect then. If You Had a Match Account as of the Transition Effective Date You may also have an Account Based Benefit, commonly called a Match Account. Before the Transition Effective Date, your employer credited Matching Contributions to the Pension Plan based on your contributions to the 403(b)/401(k) Retirement Savings Plan. (After the Transition Effective Date, any employer match was deposited in your Employer Contribution Account. See the Retirement Savings Program SPD for details.) Any Match Account balance you may have had in the Pension Plan on the day before the Transition Effective Date will remain in the Pension Plan, where your balance will continue to be credited with interest until you are eligible for and elect a distribution. The rate of interest credited to your Match Account will be declared at the end of the year for the upcoming year, but will be no less than 5% per annum. According to the terms of the Pension Plan in effect on the day before the Transition Effective Date, once you are Vested, you may elect to receive your Account Based Benefit in one lump-sum payment following termination of employment. Alternatively, you may choose to leave it in the Pension Plan, where it will continue to be credited with interest until you receive a disbursement or retire. 16

18 SECTION 4: RECEIVING YOUR BENEFITS Your Pension Plan is designed to provide you with a retirement benefit. Once you become Vested (that is, entitled to a nonforfeitable retirement benefit), terminate your employment with all Health Ministries of Ascension Health, and reach retirement age, you may choose to receive your benefit. You may choose from several payment forms. However, if the current lump-sum value of your benefit is $5,000 or less when you leave employment, then the Plan s small benefit automatic distribution provisions will apply. Distribution Highlights You may receive your benefit: You have a choice of benefit payment options: You have additional flexibility after reaching age 65: As early as age 55 if you are Vested and have terminated your employment with a Participating Institution or an Associated Entity. Alternatively, you may leave your benefit in the Pension Plan and allow it to grow, as your age increases, until age 65 (or earlier). However, if the value of your Vested benefit is less than $5,000, the small benefit automatic distribution provisions will apply. At retirement, you will have the flexibility of receiving your benefit in one lump-sum payment or in one of several monthly payment options, including: Single Life, Joint and Survivor Options, Single Life with Cash Refund, and cost-of-living options. If you wish to continue working beyond age 65, you have the flexibility of receiving your pension benefits while you are still employed. Your Accrued Benefit will continue to grow as your age increases. Three months before you want your benefit to start, please contact Pension Services to request an estimate and paperwork. If You Retire Retirement at Age 55 You may receive your benefits if you are at least age 55 when your employment terminates or when you retire provided you are Vested. Alternatively, you may leave your benefit in the Pension Plan and allow it to grow, as your age increases, until your benefit begins at age 65 (or you choose to receive it earlier). rmal Retirement (Age 65) The rmal Retirement Age under the Pension Plan is age 65. If you are an active Participant when you reach age 65, you will automatically be Vested. You may terminate employment and begin receiving your retirement benefits from the Pension Plan. 17

19 Retirement after Age 65 You may continue to work beyond age 65 and wait to start retirement benefits until you stop working. Your Accrued Benefit will not grow after the Freeze Date except for increases due to age. Alternatively, if you wish to continue working past age 65, you may receive your retirement benefits while you continue to work. If you start receiving benefits after the Freeze Date, your benefit will not increase any more. te: if you started receiving benefits before the Freeze Date, benefit accruals stop at the Freeze Date and your benefit increases with age until you terminate employment. If You Terminate Employment Once you are Vested, if you terminate employment before age 55, you will be entitled to retirement benefits at age 55 based upon your Credited Service and HAE as of the earlier of your termination date or the Freeze Date. What if I leave before age 55? If you are Vested and leave Ascension Health before age 55, and the lump-sum value of your benefit is greater than $5,000, your benefit stays in the Pension Plan where it will continue to grow as your age increases, until benefits start at age 65 (unless you elect to start benefits at age 55-65). If your benefit is $5,000 or less, then the Plan s small benefit automatic distribution provisions (described later in this section) will apply. If you had a Match Account as of the day before the Transition Effective Date, and are Vested, you may leave your Match Account in the Pension Plan and receive it as part of your monthly pension when you retire. You may also elect to withdraw your Match Account balance at any time after employment termination. If you do so, a lump-sum distribution will be made as soon as reasonably possible after you send in the application. Forms of Payment Beginning on the Transition Effective Date, you have the flexibility at retirement to choose a lump-sum payment or one of the monthly payment options. Benefit amounts under each option are actuarially equivalent. If you Spousal Consent If you are married when you retire, you will need your Spouse s consent in writing and witnessed if you do not wish to choose a form of payment that provides your Spouse with a lifetime survivor benefit. are married when you retire, you will need Spousal Consent to choose a form of payment that does not provide a lifetime monthly survivor benefit to your Spouse. Lump-Sum Payment If you choose this form of payment, your entire benefit is paid in a single lump-sum payment, also called a Total Plan Distribution. Once this distribution has been made, no further benefits are payable. 18

20 Monthly Payment Options The Pension Plan offers these monthly payment options: Single Life You receive monthly payments for your lifetime only. payments will be made after you die. Single Life with Cash Refund Option You receive reduced monthly payments for your lifetime. If you die before receiving the lump-sum value of your benefit determined at the date of your retirement, the remainder is paid to your Beneficiary in one lump-sum payment following your death. Single Life with Inflation Protection You receive reduced monthly payments for your lifetime only, with a costof-living increase (limited to 3%) on each January 1 beginning with the second calendar year of retirement. Choosing a Form of Payment When you are ready to retire, please contact Pension Services three months before you want your benefit to start to request an estimate and paperwork. You will receive information about all of the options available to you. changes to the form of payment may be made after the date of retirement has passed (whether or not you have actually received your first payment). Married Participants If you are married, the automatic form of payment is the Joint and 50% Survivor form. To elect any form of monthly payment that is not Joint & Survivor or if you choose a lump sum payment of your Accrued Benefit or Match Account, you will need to provide your Spouse s written consent on the form included in your retirement application. Your spouse s signature must be witnessed by a tary Public or your local Authorized Plan Representative. Single Participants 50%, 75%, or 100% Joint and If you are single when your monthly benefit begins, the Survivor Options You receive automatic form of payment is the single-life form of a reduced benefit for your payment. To elect any of the optional forms, you must lifetime. Then, after your death, complete the retirement application and submit the your Spouse, or other required paperwork to the Pension Service Center Beneficiary, receives a survivor before your benefit payments begin. benefit for the rest of his or her lifetime equal to all (100%) or a portion (50% or 75%) of the benefit you received. Under this form, you receive a reduced benefit so that your Spouse, or other Beneficiary, can receive a benefit for life if you die first. If your Spouse or other Beneficiary dies before you, you continue receiving the same benefit for the rest of your life, then all benefits cease upon your death. The amount of reduction depends on your age, the age of your Beneficiary at your retirement date, and the percentage (50%, 75%, or 100%) of survivor benefit you choose. There are restrictions on the age of your Beneficiary if you designate someone who is not your Spouse. You may not elect the 100% Joint and Survivor Option if a nonspouse Beneficiary is more than 10 years younger than you. You may not elect the 75% Joint and Survivor Option if a non-spouse Beneficiary is more than 19 years younger than you. Joint and Survivor with Inflation Protection You may choose one of the Joint and Survivor forms with an annual cost-of-living increase (limited to 3%). Under this form, 19

21 you receive a reduced benefit for your lifetime, but your benefit will be increased each January 1 beginning with the second calendar year of retirement. After your death, your survivor s benefit (50%, 75%, or 100% of the benefit you were receiving at your death) will also be increased each year for the rest of his or her lifetime. Your benefit and your survivor s benefit will be smaller than under the regular Joint and Survivor form in order to provide the annual cost-of-living increase. The age restrictions described under the regular Joint and Survivor form also apply here. Comparison of Payment Forms The following table illustrates an Accrued Benefit payable under each form. The example is for Pat, who retires at age 62 with a Beneficiary of the same age. Pat has an Accrued Benefit of $201,448 at age 62. Payment Forms Single Payment to Pat Monthly Benefit to Pat for Pat s Life Monthly Benefit to Pat's Beneficiary upon Pat's Death Lump-Sum Payment $201,448 Single Life $1,595 $0 Single Life with Cash Refund Option Single Life with Inflation Protection* $1,534 If Pat dies before receiving a total of $201,448 in monthly payments, Pat s Beneficiary receives the balance in a single lump-sum payment $1,207* $0 50% Joint and Survivor $1,502 $751 75% Joint and Survivor $1,461 $1, % Joint and Survivor $1,421 $1,421 50% Joint and Survivor with Inflation Protection* 75% Joint and Survivor with Inflation Protection* 100% Joint and Survivor with Inflation Protection* $1,118* If Pat dies in year 1, survivor receives: $559 per month* $1,078* If Pat dies in year 1, survivor receives: $809 per month* $1,041* If Pat dies in year 1, survivor receives: $1,041 per month* * Pat would receive an annual cost of living increase, limited to 3%, each January 1 beginning with the 2nd calendar year of retirement. Pat s survivor would also receive an annual cost of living increase. 20

22 Distribution of Small Benefits When you terminate employment, if the current lump-sum value of your benefit is less than $5,000, the Plan s small benefit provisions will apply. When a lump-sum payment or rollover also called a Total Plan Distribution is made, no additional benefits are due or payable from the Pension Plan. If the current lump-sum value of your benefit is $200 or less, including any Account Based Benefit you may have, you will automatically receive your benefit in a cash payment soon after you leave employment. If the current lump-sum value of your benefit is greater than $200 but less than $5,000, including any Account Based Benefit you may have, when you leave employment, you will receive a letter explaining that an automatic direct rollover will be made to an Individual Retirement Annuity (IRA) with Transamerica Retirement Solutions (formerly Diversified) unless you affirmatively elect to (1) receive the distribution in cash or (2) direct the rollover to another qualified plan or IRA. If a rollover is made to an IRA with Transamerica, the benefit will be invested in the Transamerica Partners Money Market Fund. Fees and expenses charged to the Participant will be deducted from Fund assets. For additional information about Transamerica or their Money Market Fund, you may log onto or call and select option 2. If you do not make your election within 90 days of being notified of your eligibility, you will receive a final notice explaining when and how the automatic distribution to the IRA with Transamerica will be made. Tax Highlights Your benefits are taxable income when you receive them; that is, when benefits are paid to you not when benefits are rolled over. We recommend you consult with a tax advisor or financial planner before you make elections about when and how to receive your benefits from the Pension Plan. Lump-Sum Payments After the end of each calendar year, you will receive Federal tax Form 1099-R showing the taxable amount of benefit payments you received. Any taxable distribution is subject to automatic withholding unless it is rolled directly to an IRA or another employer's qualified plan. You will receive notice of the opportunity to make a direct rollover before your lumpsum distribution is made. If you elect a direct rollover to another qualified plan or IRA, no tax withholding will apply. The check will be made payable to the financial institution you choose to receive the rollover. You will be responsible for forwarding the check to them. If you choose to receive your lump-sum distribution that is, have the check made payable to you 20% of the taxable amount will be withheld for Federal income tax purposes, as 21

23 required by law. If you are younger than age 59½, you may be subject to an additional 10% tax penalty when you file your tax return. Monthly Benefits Monthly benefits paid from the Pension Plan are considered taxable income. A small portion of the payments will not be taxable for Participants who made Employee contributions to a Prior Plan that was merged into this Pension Plan. 22

24 SECTION 5: OTHER SITUATIONS If You Die Before Benefit Distribution If you die before receiving benefits from the Pension Plan while still employed or after your employment has terminated if you are Vested the present value of your entire Accrued Benefit is paid to your Beneficiary. If you are still actively employed, whether or not you are Vested, your Accrued Benefit will be calculated as if you had terminated employment on the date of your death. If you had already terminated employment and were Vested, your Accrued Benefit calculated at the date of your employment termination will be adjusted to reflect your age at the date of death. If you were not Vested at employment termination, no benefits are payable. Payment will be made as soon as reasonably possible after the date of death. The form of payment depends upon whether you are married or single. Married Participant If you are married, your Spouse is your Beneficiary unless you named someone else as your Beneficiary with Spousal Consent. If your Beneficiary is someone other than your Spouse, your Pre-Retirement Death Benefits will be paid to your Beneficiary in one lump-sum payment. Your Beneficiary Options If you are married, your Beneficiary is automatically your Spouse unless you name someone else as Beneficiary (with Spousal Consent). If you are single, you may name anyone as Beneficiary. If there is no Beneficiary designation on file, benefits will be paid to your executor or administrator of your estate. Pre-retirement Beneficiary designations must be made If your Beneficiary is your Spouse, your on a form provided by the Pension Committee. When Spouse may choose to take the benefit you retire, if you choose a form of payment that in the Single Life form of payment provides survivor benefits, you will need to name your instead of a lump sum, beginning the Beneficiary in the retirement application. first of the month following your death provided the Spouse makes the election within 90 days of being informed of the option. If your Spouse elects the Single Life form of payment and you have an Account Based Benefit, commonly called a Match Account, as of the day before the Transition Effective Date, your Spouse will receive it as part of the monthly benefit. However, if the value of your entire Accrued Benefit is $5,000 or less, then the Pension Plan s small benefit automatic distribution provisions (described in Section 4) will apply. 23

25 Single Participant If you are single and you designated a Beneficiary, your benefits will be paid to your Beneficiary in a single lump-sum payment. If You Become Disabled If you were considered disabled for purposes of the Pension Plan on or before the Freeze Date, you were entitled to receive credit for Earnings and Credited Service while disabled up to the Freeze Date. Disabled Participants who were not already Vested in the Plan as of the Freeze Date became Vested on the Freeze Date. You would be considered disabled for the purposes of the Pension Plan if on or before the Freeze Date you had been unable to work for at least 3 months and were: Receiving Social Security disability benefits, or Receiving a benefit under your Participating Institution s Long-Term Disability (LTD) plan (or would be considered disabled under Ascension Health s LTD plan if you are not covered under your Participating Institution s LTD plan). Determining Your Benefit In determining your benefit, your Hours and Earnings during your period of disability are assumed to be equal to your Hours and Earnings in whichever of the following years you were paid the highest Earnings: In the year you became disabled, if prior to the Freeze Date, In either of the two years prior to disability, if prior to the Freeze Date, or The year the Pension Plan was frozen. Choosing Retirement Following Disability You may choose to commence your pension benefits as early as age 55, or you may leave your benefits in the Pension Plan, until age 65, where they will grow as your age increases. If you choose to commence your benefits, benefits are determined and paid to you as if you had elected to retire. te: Benefits from the Ascension Health LTD Plan are not reduced as a result of any distributions a disabled Participant receives from the Pension Plan after Jan. 1, Recovery and Return to Work If you recover prior to receiving any retirement benefits from the Pension Plan and return to work with a Participating Institution, you will be treated as an active Participant. You will not earn additional Credited Service under the Plan after the Freeze Date, but may be eligible to participate in other retirement benefits offered to active Participants. If you recover after the Freeze Date and after receiving retirement benefits from the Pension Plan, the provisions described in the If You Retire and Return to Work subsection below will apply. 24