SUMMARY PLAN DESCRIPTION Administaff Health Care Flexible Spending Account Plan

Transcription

1 SUMMARY PLAN DESCRIPTION Administaff Health Care Flexible Spending Account Plan

2 Administaff Health Care Flexible Spending Account Plan SUMMARY PLAN DESCRIPTION Effective January 1, 2008 Rev

3 Table of Contents Introduction... 1 Words and Phrases With Special Meanings... 1 General Information About the Plan... 1 Purpose of the Plan... 1 Who is Eligible... 1 Participation and Enrollment... 2 Termination of Participation... 3 If You Lose and Regain Eligibility During the Calendar Year... 3 Leaves of Absence... 4 Changing Your Election During the Calendar Year... 5 Participant Contributions... 5 In General... 5 Nondiscrimination... 5 Plan Benefits... 6 In General... 6 Amount You Can Elect... 6 Eligible Health Care Expenses... 6 Amounts Available for Reimbursement... 7 Receiving Reimbursement... 7 Forfeited Amounts... 7 Claims For Benefits... 8 In General... 8 Initial Claim for Benefits... 8 Questions and Complaints... 9 Claim Appeal Process Level I Appeal. How and When to File a Level I Appeal... 9 Review of Level I Appeals... 9 Level II Voluntary Appeals Process Effect of Appeal Decision Certain Legal Rights Coverage During Family and Medical Leave COBRA Continuation Coverage Continuation of Coverage for Military Leave Your Rights Under ERISA Newborns and Mothers Health Act Women s Health and Cancer Rights Act Benefits Qualified Medical Child Support Order Other Plan Information Authority of Plan Administrator No Guarantee of Employment No Guarantee of Tax Savings Amendment or Termination of the Plan Additional Plan Information Glossary Appendix A: Election Change Rules Appendix B: Eligible Health Care Expenses Appendix C: Filing Your Claim

4 Administaff Health Care Flexible Spending Account Plan SUMMARY PLAN DESCRIPTION INTRODUCTION This summary (including any appendix or attachment hereto) is the Plan s summary plan description within the meaning of ERISA (the summary ). This summary has been prepared by Administaff of Texas, Inc. ( Administaff ). This summary includes many of the Plan s most important rules about Plan benefits. However, this summary does not contain every detail of the Plan or all of its specific terms. You may read or request a copy of the official Plan documents to learn about any additional terms, conditions and limitations that may apply. You may contact Administaff for this information. WORDS AND PHRASES WITH SPECIAL MEANINGS This summary contains a number of words and phrases that have special meanings under the Plan and this summary. These words and phrases (sometimes called defined terms ) are capitalized in this summary. The special meanings of these words and phrases appear in the Glossary section of this summary. You must carefully review the special meanings in the Glossary to understand your rights, benefits and duties under the Plan. GENERAL INFORMATION ABOUT THE PLAN Purpose of the Plan The purpose of the Plan is to allow you to elect an annual coverage amount to pay for Eligible Health Care Expenses incurred throughout the calendar year on a pre-tax basis. You pay for this coverage through monthly pre-tax salary reduction in lieu of receiving a corresponding amount of current pay. This arrangement helps you because the level of coverage you elect is generally nontaxable, allowing you to save Social Security and income taxes on the amount of the contributions you make. Who Is Eligible Eligible Employees may participate in the Plan. You are an Eligible Employee only if you are a full-time employee of Administaff actively working at least 30 hours per week (or 20 hours per week in Hawaii), or meet the requirements for continuing eligibility during an approved leave of absence. The Leaves of Absence heading under this section describes these rules. However, even if either of these things is true, you cannot be an Eligible Employee, regardless of whether you are a common law employee of Administaff, if: You are covered by a collective bargaining agreement (unless the agreement between Administaff and the client company provides for coverage of employees covered by such collective bargaining agreement under the Plan), OR You do not reside in the United States, OR You are paid through the payroll of a temporary agency or similar organization, OR

5 You have a written contract with Administaff or the client company that states either that you are not an employee or are not entitled to participate in the employee benefits of Administaff, OR You are designated, compensated or otherwise treated as an independent contractor by Administaff or the client company, OR You work on a part-time, temporary, seasonal, contract, leased or project basis, OR You are self-employed or treated as such for federal income tax purposes by Administaff, OR You are an individual who the Plan Administrator would reasonably expect to be treated as selfemployed for federal income tax purposes in the absence of a services agreement between Administaff and the client company (as determined by the Plan Administrator in its sole discretion in accordance with its administrative procedures). Participation and Enrollment You must enroll to participate in the Plan. As an Eligible Employee, you can enroll for coverage in the Plan by doing all of these things: Complete an enrollment form. File the form with Administaff during the applicable enrollment period. Contact Administaff to learn how to file the enrollment form. The discussion below under this heading describes when the enrollment periods occur. Pay any required cost for coverage. The Participant Contributions section describes these rules. As an Eligible Employee, you can enroll for Plan coverage only during one of these enrollment periods: The initial enrollment period. This is the 30-day period starting on the date an employee first becomes eligible for Plan coverage. The annual open enrollment period. This is held before the start of each calendar year. During this period, all Eligible Employees can enroll. Contact Administaff to learn when the annual open enrollment period happens. If you enroll during the annual open enrollment period, your coverage will usually begin on the first day of the next calendar year and corresponding salary reductions will begin on your first pay date of that calendar year. If you enroll during your initial enrollment period, your coverage will usually begin on the first day of the first full pay period following the date your enrollment form is processed by Administaff and your corresponding salary reductions will begin on the pay date that applies to that pay period. If you do not enroll during the initial enrollment period, you generally must wait to enroll during the next annual open enrollment period. This will delay coverage. In addition, if you enroll for coverage during your initial or open enrollment period and subsequently lose eligibility on or before the date your coverage would otherwise begin (for example, you are no longer actively at work due to a leave of absence), your coverage will be delayed until you regain eligibility. Generally, once your enrollment period ends, you cannot cancel or change your enrollment election until the next annual open enrollment period. This means that any request for change or correction to a previously filed enrollment form must also be made within your enrollment period. There is a special exception to this rule if you have a change in status or election change event. The Changing Your Election During the Calendar Year heading under this section describes generally when you have a change in status or other election change event and how you can cancel or change your Plan enrollment election. An affirmative enrollment election is required for participation in the Plan for each applicable calendar year. This means that you must make a new annual election for participation in the Plan each year by submitting a new enrollment form during the applicable annual open enrollment period. Enrollment elections will not carry over from year to year

6 If you enroll for coverage and Administaff determines that you are not an Eligible Employee, your enrollment election will be deemed void as of the same date it would otherwise become effective, regardless of whether or not you have been enrolled in the Plan or have incurred or filed any claims for Plan benefits. Termination of Participation Your participation in the Plan ends on the earliest of the date the Plan terminates, the date you fail to pay a contribution due for your Plan coverage, or the date you are no longer an Eligible Employee. See the COBRA Continuation Coverage heading under the Certain Legal Rights section of this summary for a discussion of any continuation of coverage rights that may apply. If You Lose and Regain Eligibility During the Same Calendar Year The following special rules apply to certain individuals who enroll in the Plan and who later lose and regain eligibility during the same calendar year. Examples of how an individual may lose and regain Plan eligibility during the same calendar year include a mid-year termination and rehire, a change in employment status from full-time to part-time and back to full-time, or a return from a leave of absence exceeding 12 weeks (or any longer continuation period required by a state or federal leave law that applies to your coverage). Regain Eligibility Within 7 Days of Loss Any Client Company. If an event occurs which would otherwise cause you to lose and regain Plan eligibility during the same calendar year and your corresponding period of Plan ineligibility would be 7 days or less, you will be treated as continuously eligible. If this happens, you will be required to make up any missed contributions. You may not change or revoke your Plan enrollment election unless an intervening Election Change Event occurs. (See the discussion under the Changing Your Election During the Calendar Year heading below in this section for rules that apply.) Regain Eligibility After 7 But Before 31 Days of Loss Any Client Company. If an event occurs which causes you to lose and regain Plan eligibility during the same calendar year and your corresponding period of Plan ineligibility is more than 7 but less than 31 days, your prior Plan enrollment election will be automatically reinstated effective as of the date you regain eligibility. If this happens, your monthly contribution and annual coverage level elections will be reinstated as in effect prior to your eligibility loss and you will be required to make up any missed contributions. Both contributions and reimbursements with respect to your previous Plan participation during the calendar year will apply to determine your level of coverage and amount available for reimbursement for the remainder of the calendar year as to any reinstated coverage. For example, assume you elect to contribute $200 per month toward $2400 in annual coverage, effective January 1. During the month of January you receive $200 in reimbursement benefits under the Plan. You are later terminated and lose eligibility effective March 1. However, on March 10, you are rehired by the same client company and regain eligibility. When this happens, your prior election to contribute $200 per month will be automatically reinstated and you will be required to make up any contributions missed during the period in which you were ineligible. As a result, your reinstated annual coverage level will be the same as it was prior to your eligibility loss your annual coverage level will equal $2400, with $2200 available for reimbursement for the remainder of the calendar year. However, you may not receive reimbursement benefits under the Plan for the period in which you were ineligible (in this example, March 1 through March 9). You may not change or revoke your Plan enrollment election unless an intervening Election Change Event occurs. (See the discussion under the Changing Your Election During the Calendar Year heading below in this section for rules that apply)

7 Any Other Regain of Eligibility During the Calendar Year. If any other event not described above occurs which causes you to lose and regain Plan eligibility during the same calendar year, you may elect to reinstate your Plan coverage effective as of the date you regain eligibility and make a new Plan enrollment election for the remainder of the calendar year. If this happens, both contributions and reimbursements with respect to your previous Plan participation during the calendar year will apply to determine your level of coverage and amount available for reimbursement for the remainder of the calendar year as to any reinstated coverage and new Plan enrollment election. For example, assume you elect to contribute $200 per month toward $2400 in annual coverage, effective January 1. During the month of January, you receive $200 in reimbursement benefits under the Plan. You are later terminated and lose eligibility effective March 1. On May 1, you are rehired and elect to resume monthly contributions of $200. When this happens, your reinstated annual coverage level will equal $2000 ($200 per month for 10 months), with $1800 available for reimbursement for the remainder of the calendar year. Leaves of Absence Plan coverage may be continued for up to 12 weeks (or any longer continuation period required by a state or federal leave law that applies to your coverage) during an approved leave of absence, but you must continue to pay the contributions due for your Plan coverage. The following rules apply with respect to Plan coverage and approved leaves of absence: If you are on a paid leave of absence, you must continue your Plan coverage and corresponding salary reductions for the period of your paid leave (up to 12 weeks, or any longer continuation period required by a state or federal leave law that applies to your coverage) in the same manner as before your leave began. If you are on an unpaid leave of absence, you may elect to (i) suspend Plan coverage for the period of your leave, or (ii) continue Plan coverage in the same manner as before your leave began. You must continue to pay the contributions due for continued Plan coverage. During an unpaid leave of absence, your contributions for continued coverage will be after-tax contributions. Contact Administaff at the time your leave begins to learn how to make this election and your corresponding Plan coverage payment obligations. Your coverage will be suspended unless you elect to continue Plan coverage during the period of your leave. If you elect to suspend coverage for the period of your unpaid leave of absence, your coverage will be reinstated upon your return from such leave at (i) your prior Plan enrollment annual coverage election, or (ii) your prior Plan enrollment monthly contribution election, with your annual coverage level reduced for the period your coverage was suspended. Contact Administaff to learn how to designate a reinstated coverage level upon your return from an unpaid leave of absence where coverage was suspended. Your coverage will be reinstated at a reduced level unless you elect to make up any missed contributions. Both prior contributions and reimbursements with respect to your previous Plan participation during the calendar year will apply to determine your level of coverage and amount available for reimbursement for the remainder of the calendar year as to any reinstated coverage. If you are on a leave of absence that exceeds 12 weeks (or any longer continuation period required by a state or federal leave law that applies to your coverage), you will no longer be an Eligible Employee and your Plan participation will cease at the end of the first 12 weeks of your leave (or any longer continuation period required by a state or federal leave law that applies to your coverage). If this happens, you may be eligible to continue Plan coverage under COBRA. See the COBRA Continuation Coverage heading under the Certain Legal Rights section of this summary for a discussion of any continuation rights that may apply. The If You Lose and Regain Plan Eligibility During the Same Calendar Year heading under this section explains the rules that apply if you later regain Plan eligibility during the same calendar year

8 Special rules may apply to leaves that qualify under the Family and Medical Leave Act. See the Coverage During Family and Medical Leave heading under the Certain Legal Rights section of this summary for rules that may apply. In addition, for an approved leave of absence that is a military leave, special rules may apply under the Uniformed Services Employment and Reemployment Rights Act. See the Continuation of Coverage for Military Leave heading under the Certain Legal Rights section of this summary for rules that may apply. Changing Your Election During the Calendar Year Generally, you cannot change your Plan enrollment election during a calendar year. You may change your election only during the annual open enrollment period, and then, only for the next calendar year. There is an important exception to this general rule: You may elect to change your Plan enrollment election during a calendar year if you experience an Election Change Event. The rules and conditions that apply to Election Change Events are generally described in Appendix A to this summary Election Change Rules (attached). However, you should contact Administaff with questions about whether you have experienced an Election Change Event or to learn more about the types of election changes you may make in relation to such an event. If an Election Change Event occurs, you have only a limited amount of time to request a Plan enrollment election change. Generally, you have 30 days from the date of an Election Change Event in which to request a Plan enrollment election change. Contact Administaff for the form necessary to file this request. The COBRA Continuation Coverage section of the summary below describes the notification periods that apply if you experience an election change event that is a COBRA qualifying event and you are required to notify the Plan Administrator of such event in order to exercise your COBRA rights. NOTE: The Plan Administrator may modify your election(s) downward during the calendar year if you are considered a key employee or highly compensated individual (as defined by the Code), if the Plan Administrator determines, in its sole discretion, that it is necessary to comply with federal law or to prevent the Plan from becoming discriminatory within the meaning of the federal income tax law. See the Nondiscrimination heading under the Participant Contributions section of this summary below for more information regarding nondiscrimination. PARTICIPANT CONTRIBUTIONS In General When you complete the enrollment form, you elect to make contributions for Plan benefits through pre-tax salary reduction under the Administaff Cafeteria Plan. This means that the contributions due for your Plan coverage will be paid with the portion of gross income that you have elected to forego through salary reduction. Your salary will then be reduced each pay period pursuant to your salary reduction election for the calendar year (or portion thereof) to which your election applies. Nondiscrimination Both this Plan and the Administaff Cafeteria Plan are subject to certain nondiscrimination rules under the Code. These rules are designed by the IRS to ensure that certain individuals namely, highly compensated participants and key employees do not receive disproportionate benefits under such tax-favored plans. Administaff performs nondiscrimination testing separately with respect to each client company (or controlled group of client companies) on an annual basis. If a client company fails nondiscrimination testing for a given year, highly compensated and/or key employee participants are generally taxed on the amount of their pretax employee contributions, including any dependent coverage, made during that year

9 There is no guarantee that your contributions to this Plan will remain pre-tax. If the nondiscrimination tests are failed, then your contributions may be recharacterized for the prior year as after-tax and you may be issued a corrected W-2. You may want to consider this before deciding to participate, especially if you are a key or highly compensated employee. For more detailed information regarding nondiscrimination testing as it applies to this Plan and the Administaff Cafeteria Plan, a Guide to Eligibility and Nondiscrimination is available online through the Employee Service Center SM at PLAN BENEFITS In General If you elect benefits under the Plan, an unfunded recordkeeping account referred to as a Health Care FSA Account will be set up in your name to keep a record of the reimbursements you are entitled to, as well as the contributions you make for such benefits during the calendar year. You should note that this benefit is not insured, and that all benefits are paid from Administaff s general assets. Amount You Can Elect When you enroll in the Plan, you will choose a monthly contribution amount ranging from $20 to $250 (in multiples of 10) to set your annual coverage level. If you enroll during the annual open enrollment period for coverage beginning January 1, your coverage under the Health Care FSA for the calendar year will be equal to your monthly election multiplied by 12. If you enroll mid-year, your coverage under the Health Care FSA for the remainder of the calendar year will be equal to your per-pay-period reduction amount multiplied by the remaining pay periods in the year. Your monthly contributions are made through salary reduction. The salary reduction amount deducted from each paycheck is the per-pay-period reduction amount described below. To calculate your per-pay-period reduction amount, we annualize your monthly contribution amount and divide by the total number of pay periods in the calendar year. For example, suppose you have elected to make a monthly contribution of $100 for a $1200 annual coverage level. Your Health Care FSA Account would be credited with a total of $1200 for the calendar year. If you were paid bi-weekly, you would contribute $46.15 per payday for your Plan coverage. The per-pay-period reduction amount may vary depending on any changes in pay frequency, available compensation, leave of absence or termination of employment. Eligible Health Care Expenses Eligible Health Care Expenses are any items that are considered medical expenses under Code section 213 (except as noted below) for which you have not been reimbursed from insurance or otherwise. Generally, Eligible Health Care Expenses are expenses that could be deducted on your federal income tax return plus certain additional items that are for medical care as defined under Code section 213(d) (certain over-thecounter drugs and medicines, for example). Eligible Health Care Expenses may include expenses for yourself, your spouse and any person who is your tax dependent within the meaning of Code section 152 (without regard to certain limitations on your dependent s gross income or marital and filing status under such rules). Also, children of divorced parents can be treated as dependents of both parents for this purpose. See Appendix B to this summary Eligible Health Care Expenses (attached) for a list of many common types of Eligible Health Care Expenses. You should note, however, that the Code places additional restrictions on such expenses. For example, premiums for accident or health insurance and long-term care services are not Eligible Health Care Expenses. Consult your personal tax advisor or IRS Publication 502, Medical and Dental Expenses, for further general guidance as to what is considered an Eligible Health Care Expense

10 Amounts Available for Reimbursement While you continue to pay the contributions due for your Plan coverage, the full annual coverage level you have elected will be available at any time during the calendar year, less any reimbursements you have received for Eligible Health Care Expenses incurred during such calendar year. Receiving Reimbursement If you elect to participate in the Plan, you must take certain steps to be reimbursed for your Eligible Health Care Expenses. When you incur an expense that is eligible for reimbursement, you must submit a request for reimbursement to the Claims Administrator. Contact the Claims Administrator to learn how to submit a request for reimbursement. See Appendix C to this summary Filing Your Claim (attached) for general information about the claim filing options that may be available to you through the Claims Administrator. In most cases, you must include with the request for reimbursement a written (or electronic) statement or bill from an independent third party which clearly indicates that an Eligible Health Care Expense has been incurred, the amount of such expense and, when requested by the Claims Administrator or Plan Administrator, a physician s statement or other documentation of the medical need for the service or supply. In addition, you must certify that the amount you are requesting for reimbursement is not reimbursable from any other source. To have your request for reimbursement processed as soon as possible, you should follow the instructions on the request for reimbursement form or otherwise provided by the Claims Administrator. Your reimbursement may be delayed or denied if you do not submit complete information. Please note that it is not necessary that you have actually paid an amount due for an Eligible Health Care Expense only that you have incurred the expense, and that it is not being paid for or reimbursed from any other source. In addition, IRS regulations require that a medical service actually be rendered prior to the time that the Eligible Health Care Expense is reimbursed. Therefore, if your doctor requires that an Eligible Health Care Expense be paid in advance, you cannot be reimbursed under the Plan until the related medical service has been rendered. Eligible Health Care Expenses must have been incurred during the calendar year to which the request for reimbursement relates. This means that you may not be reimbursed for any expenses incurred before the calendar year begins, before your salary reduction agreement becomes effective, after the close of the calendar year or during any other period in which your Plan eligibility was not in effect. Also, you cannot be reimbursed for any expenses in excess of the amount of coverage you elected. You will have until the March 31 following the end of the applicable calendar year to submit a request for reimbursement form for Eligible Health Care Expenses incurred during that calendar year. You will be notified in writing if any request for reimbursement is denied. If you receive a payment from the Plan for an expense or service that is not an Eligible Health Care Expense, you must promptly repay any such amount. Administaff may withhold any such amount from your compensation in satisfaction of such repayment obligation. Forfeited Amounts You will not be entitled to receive any direct or indirect payment of any amount that represents any excess of the annual coverage level you have elected and contributed for the calendar year over the actual Eligible Health Care Expenses you have incurred for that calendar year. Any amount for which you have not timely filed a request for reimbursement by the March 31 following the end of the calendar year to which the request for reimbursement relates will be forfeited by you and retained by Administaff

11 CLAIMS FOR BENEFITS In General This section provides information about claims for benefits under the Plan, and how appeals of denied claims are handled for Plan benefits. You may not seek review of a denial of benefits prior to filing a claim for benefits under the Plan. You may not bring an action in court to enforce a claim for benefits prior to exhausting all rights to administrative review under the Plan. If you fail to file a claim or a request for review in accordance with the Plan s procedures, the claim shall be deemed denied and you shall have no right to review and shall have no right to bring any action in any court and the denial of the claim shall become final and binding on all persons for all purposes. If you have designated an authorized representative, that person may act on your behalf in the claim or appeal process. Initial Claim for Benefits Once the Claims Administrator receives a properly filed claim from you or your provider, a benefit determination will be made within 30 days. This period may be extended one time for up to 15 additional days, if necessary due to matters beyond the Claims Administrator s control. If the Claims Administrator determines that additional time is necessary, you will be notified, in writing, prior to the expiration of the original 30-day period, that the extension is necessary, along with an explanation of the circumstances requiring the extension of time and the date by which the Claims Administrator expects to make the determination. If, upon receipt of your claim, the Claims Administrator determines that additional information is necessary in order for it to be a properly filed claim, the Claims Administrator will provide you with written notice of the information needed prior to the expiration of the initial 30-day period. You will have 45 days from receipt of the notice to provide the additional information. The Claims Administrator will notify you of its benefit determination within 15 days following receipt of the additional information. If an initial claim for Plan benefits is denied, the law provides you with a right to receive the following information about the denial: The specific reason(s) for the denial or decision; Reference to the specific Plan provision(s) on which the denial or decision was based; A description of any additional material or information necessary to appeal the decision and an explanation of why the information is necessary; A description of the Plan s review procedures and the time limits applicable to such procedures, including a statement of your right to bring a civil action under section 502(a) of ERISA after a benefit denial on review; If an internal rule, guideline, protocol, or other similar criterion ( criterion ) was relied upon in making the denial, either the: specific criterion used, or a statement that such criterion was relied upon in making the benefit denial and that a copy of such criterion will be provided free of charge upon request; and If the benefit denial is based on medical necessity or experimental treatment or similar exclusion or limit, either an explanation of the scientific or clinical judgment for the determination, applying the terms of the Plan to your special medical circumstances, or a statement that such explanation will be provided free of charge upon request

12 Questions and Complaints If you have a question or complaint, an initial attempt should be made to resolve the problem directly with the Claims Administrator. In most cases, the Claims Administrator will be able to provide you with a satisfactory solution to your problem. However, if a resolution cannot be reached in an informal exchange, you may request an administrative review of the problem through the appeal process described below. You must use the Level I appeal process below before seeking a review of your claim in court. You may request to review information used to make any adverse determination. Copies will be provided free of charge. CLAIM APPEAL PROCESS Level I Appeal. How and When to File a Level I Appeal If you are not satisfied with the initial attempt to resolve your problem, or if you wish to request a review of a benefit determination, you must request an appeal within 180 days from the date you received notice that your claim was denied. If you do not appeal on time, you will lose the right to appeal the denial and the right to file suit in court. Unless otherwise indicated on your written benefit determination, you must submit your request to the Claims Administrator at the following address: UnitedHealthcare Appeals P.O. Box El Paso, TX The written request for an appeal should include your name, identification number, patient name, the nature of the complaint, the facts upon which the complaint is based, the resolution you are seeking, and the reason you feel your claim should not have been denied. Necessary facts are: dates and places of services, names of providers of services, place and types of services or procedures received and the corresponding medical need (if applicable). You should include any documentation that you want to be considered on review. The Claims Administrator may request further information if necessary. Review of Level I Appeals Your appeal will be reviewed by an appropriate named fiduciary of the Plan who is not the same as (nor a subordinate of) the individual who made the initial review, and no deference will be afforded to the initial decision. In addition, a health care professional who has appropriate training and experience in the field of medicine may be consulted in regard to your claim. If this happens, or if any other medical or occupational expert is consulted in regard to your claim, you may request the identity of such person. The Claims Administrator will provide you a written decision on your appeal no later than 60 days following the date your appeal is received. If you appeal your claims decision and the appeal is denied, the law provides you with a right to receive the following information about the denial of the appeal: The specific reason(s) for the denial or decision; Reference to the specific Plan provision(s) on which the denial or decision was based; A statement that you are entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant to your claim for benefits; A statement describing the Level II voluntary appeal procedures (described below) offered by the Plan and your right to obtain information about those procedures, and a statement of your right to bring an action under section 502(a) of ERISA;

13 If an internal rule, guideline, protocol, or other similar criterion ( criterion ) was relied upon in making the denial, either the specific criterion used, or a statement that such criterion was relied upon in making the benefit denial and that a copy of such criterion will be provided free of charge upon request; If the benefit denial is based on medical necessity or experimental treatment or similar exclusion or limit, either an explanation of the scientific or clinical judgment for the determination, applying the terms of the Plan to the person s special medical circumstances, or a statement that such explanation will be provided free of charge upon request; and A statement that advises you that you and the Plan may have other voluntary alternative dispute resolution options, such as mediation. Level II Voluntary Appeals Process After exhaustion of the Level I appeals process outlined above, you may submit any remaining denied claim to the Plan Administrator for review on a voluntary basis. The Plan Administrator will not charge you any fees or costs as a part of the voluntary appeal process. Your decision as to whether or not to submit a denied claim to the voluntary level of appeal will have no effect on your right to any other benefits under the Plan. If you elect to pursue your voluntary appeal rights, any statute of limitations or other defense based on timeliness will be tolled during the time that any voluntary appeal is pending. The Plan Administrator cannot claim that you failed to exhaust the administrative remedies available to you for failing to submit the denied claim appeal (from Level I) to the Plan Administrator s voluntary review process. To request Level II reconsideration of your benefit determination, you should submit your request in writing within 60 days of the date your Level I appeal was denied to the following address: Administaff of Texas, Inc. ATTN: Manager, Health & Welfare Products Crescent Springs Drive Kingwood, Texas The written request should include your name, identification number, patient name, the nature of the complaint, the facts upon which the complaint is based, the resolution you are seeking, and the reason you feel your claim should not have been denied. Necessary facts are: dates and places of services, names of providers of services, place and types of services or procedures received and the corresponding medical need (if applicable). You should include any documentation that you want to be considered on review. The Plan Administrator may request further information if necessary. If your Level II appeal is denied, you will receive a written explanation of the denial no later than 60 days following the date your appeal is received. The law provides you with a right to receive the same type of information as described above for a Level I response. Effect of Appeal Decision Decisions on appeals will be made at the sole discretion of the Claims Administrator and the Plan Administrator, in their respective roles, and will be final and binding on all persons. You must file a claim for benefits and request a Level I appeal of any complete or partial claim denial before seeking a review of your benefit claim in court. A decision on a Level I appeal of a claim denial (or a Level II appeal, if you file one) will be the final decision of the Plan. After the final decision is made by the Plan, you may seek judicial remedies in accordance with your rights under section 502(a) of the Employee Retirement Income Security Act of 1974 (ERISA)

14 CERTAIN LEGAL RIGHTS Coverage During Family and Medical Leave Covered Eligible Employees taking an approved leave of absence under a federal law called the Family and Medical Leave Act of 1993 ( FMLA ) have certain rights to continued Plan benefits. Contact Administaff to learn whether FMLA applies to your leave of absence. If you are a covered Eligible Employee who takes an approved leave of absence covered by FMLA, your Plan coverage will continue under the same terms and conditions that would have applied had you continued to work, unless you elect otherwise. This means that you must continue to make the same monthly contribution for your Plan coverage that you made before the leave began. If you are on a paid leave of absence, you must continue to make your monthly contribution in the same manner as before your leave began. If you are on an unpaid leave of absence, you must make your monthly contribution in regular installments over the course of your leave. Contact Administaff to learn more about making your Plan coverage contributions during an unpaid leave of absence. If you do not return to full-time, active work with Administaff after the end of your FMLA leave, your Plan coverage will terminate. You may then continue coverage only under COBRA. See the COBRA Continuation Coverage heading under this section for the COBRA rules. If your payment for any required contribution during your FMLA leave is more than 30 days late, your coverage may be terminated. Prior to a termination for nonpayment, Administaff will notify you that your payment is late and you will have at least 15 days from that date to make the payment. While on FMLA leave, you have the same rights to change your elections under the Plan under the same terms and conditions that apply to participants in the Plan who are not on FMLA leave. See Appendix A to this summary Election Change Rules (attached) for more information. Additional rules and restrictions governing Plan coverage during certain leaves of absence, including leaves of absence covered by FMLA, are described under the Leaves of Absence heading of the General Information About the Plan section of this summary. COBRA Continuation Coverage The right to COBRA continuation coverage was created by a federal law, the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA). To the extent required by this law and as described in this discussion, COBRA continuation coverage can become available to you and your covered spouse and dependent children when group health plan coverage would otherwise be lost due to certain qualifying events described below. For additional information about your rights and obligations under the Plan and under federal law, you should contact Administaff. The Plan offers no greater COBRA rights than what the COBRA statute requires, and this summary of COBRA rights should be interpreted accordingly. IMPORTANT NOTICE REQUIREMENTS! Any notice provided to the Plan Administrator under COBRA must be in writing and must follow the Plan s notice procedures described below. Any attempted notice to the Plan Administrator that is not in writing (for example, an oral notification by telephone) will not be effective. What Is COBRA Continuation Coverage? COBRA continuation coverage is the same coverage that the Plan gives to similarly situated participants or beneficiaries under the Plan who are not receiving COBRA continuation coverage. Each qualified beneficiary who elects COBRA continuation coverage generally will have the same rights under the Plan as other similarly situated non-cobra participants or beneficiaries covered under the Plan. In addition, Plan changes for similarly situated non-cobra beneficiaries can also apply to COBRA qualified beneficiaries

15 After a qualifying event, COBRA continuation coverage must be offered to each person who is a qualified beneficiary. You, your spouse (as defined by federal law) and your dependent children (including a child covered due to a qualified medical child support order) can be qualified beneficiaries if coverage under the Plan is lost because of the qualifying event. Any child born to or placed for adoption with a qualified beneficiary who was a covered employee is also a qualified beneficiary for whom continuation coverage may be elected. Under the Plan, qualified beneficiaries who elect COBRA continuation coverage must pay for COBRA continuation coverage. Qualified beneficiaries (including those who are not former employees) may add dependents to their COBRA continuation coverage in the same manner as active employees. These dependents are generally not qualified beneficiaries and are thus not entitled to make separate continuation coverage elections. Furthermore, coverage for these dependents will terminate no later than the date the qualified beneficiary s coverage terminates. In addition, a domestic partner (including a same-sex spouse) is not a qualified beneficiary under the Plan, but may be added to Plan coverage as a dependent of a qualified beneficiary in the same manner as the Plan allows for covered employees under the Plan who are not receiving COBRA continuation coverage. COBRA rights in addition to those described under this heading may apply to certain employees under a federal law called the Trade Act of 2002 ("Trade Act"). Certain employees who have experienced a termination of employment or reduction in work hours with Administaff and who qualify for "trade readjustment allowance" or "alternative trade adjustment assistance" may qualify for additional COBRA rights under the Trade Act, including a second COBRA election period if COBRA was not elected when first available. Contact the Plan Administrator for more information or if you qualify for assistance under the Trade Act. What Are Qualifying Events? If you are covered as an Eligible Employee, you will become a qualified beneficiary if you lose your coverage under the Plan because either one of the following qualifying events happens: Your hours of employment are reduced, or Your employment ends for any reason other than your gross misconduct. If you are covered as the spouse (as defined by federal law) of an Eligible Employee, you will become a qualified beneficiary if you lose your coverage under the Plan because any of the following qualifying events happens: Your spouse dies; Your spouse s hours of employment are reduced; Your spouse s employment ends for any reason other than his or her gross misconduct; Your spouse becomes entitled to Medicare benefits (under Part A, Part B, or both); or You become divorced or legally separated from your spouse. Dependent children will become qualified beneficiaries if they lose coverage under the Plan because any of the following qualifying events happens: The parent-employee dies; The parent-employee s hours of employment are reduced; The parent-employee s employment ends for any reason other than his or her gross misconduct; The parent-employee becomes entitled to Medicare benefits (Part A, Part B, or both); The parents become divorced or legally separated; or The child stops being eligible for coverage under the Plan

16 When Is COBRA Coverage Available? The Plan will offer COBRA continuation coverage to qualified beneficiaries only after the Plan Administrator has been notified that a qualifying event has occurred. When the qualifying event is the end of employment or reduction of hours of employment, death of the employee, or the employee s becoming entitled to Medicare benefits (under Part A, Part B, or both), Administaff must notify the Plan Administrator of the qualifying event. You Must Give Notice of Some Qualifying Events For the other qualifying events (divorce or legal separation of the employee and spouse or a dependent child ceasing to be an eligible dependent child), if a qualified beneficiary experiences a qualifying event he or she must notify the Plan Administrator within 60 days after the qualifying event occurs. If you fail to meet this deadline, your notice will be rejected as untimely and you will lose your right to COBRA continuation coverage. See the Notice Procedures below for instructions on how to notify the Plan Administrator of a qualifying event and other events. Notice Procedures Notice of Certain Initial Qualifying Events To notify the Plan Administrator of an initial qualifying event described above (divorce or legal separation of the employee and spouse or a dependent child ceasing to be an eligible dependent child), you must submit a completed Enrollment/Change Request form to your Payroll Specialist. Please call Administaff at to request this form and to inquire how to send this notification to your Payroll Specialist. If you mail your notice, it must be postmarked no later than the last day of the required notice period. Any other method of notice (delivery, fax or ) must be actually made and received by the Plan Administrator no later than 5 p.m. Central time on the last day of the notice period. If you fail to meet this deadline, your notice will be rejected as untimely. If your notice fails to include all of the required information, the Plan Administrator will attempt to contact you to request the missing information. If you fail to provide any missing information as soon as reasonably possible following such a request, your notice will be rejected as insufficient. Your notice must include the following information: The name of the Plan (the Administaff Health Care Flexible Spending Account Plan), The full name, address and Social Security number of the employee covered under the Plan, The full name(s) and address(es) of the affected qualified beneficiary(ies) and any other covered persons, A description of the qualifying event and the date it occurred, and If the notice relates to a qualifying event that is a divorce or legal separation, your notice must also include a complete copy of the divorce or separation order. Other Notices Any notice provided to the Plan Administrator under COBRA (other than an initial qualifying event notice described above) must be in writing and must follow the Plan s notice procedures described below. Any attempted notice to the Plan Administrator that is not in writing (for example, an oral notification by telephone) will not be effective. If you mail your written notice or have it hand-delivered, you must mail or deliver it to the Plan Administrator at the following address: Administaff of Texas, Inc. COBRA Administration Crescent Springs Drive Kingwood, Texas

17 If you fax your written notice to the Plan Administrator, please call Administaff at to obtain the fax number. If you your written notice to the Plan Administrator, you must it to If you mail your notice, it must be postmarked no later than the last day of the required notice period. Any other method of notice (delivery, fax or ) must be actually made and received by the Plan Administrator no later than 5 p.m. Central time on the last day of the notice period. If you fail to meet this deadline, your notice will be rejected as untimely. If your notice fails to include all of the required information, the Plan Administrator will attempt to contact you to request the missing information. If you fail to provide any missing information as soon as reasonably possible following such a request, your notice will be rejected as insufficient. Your notice must include the following information: The name of the Plan (the Administaff Health Care Flexible Spending Account Plan), The full name, address and Social Security number of the employee covered under the Plan, The full name(s) and address(es) of the affected qualified beneficiary(ies) and any other covered persons, and A description of the event and the date it occurred (as applicable). In addition to the above notification requirements, the following rules apply: If the notice relates to a second qualifying event that is a divorce or legal separation, your notice must also include a complete copy of the divorce or separation order. If the notice relates to a disability extension, your notice must also include the disabled qualified beneficiary s name, the date disability occurred, the date the Social Security Administration (SSA) made its determination of the disability and proof of SSA s determination (such as a copy of the SSA determination letter). If you fail to provide notice of an event that causes your COBRA continuation coverage to terminate before the end of the maximum continuation period (for example, a determination by SSA that a qualified beneficiary is no longer disabled), the Plan Administrator will terminate your coverage retroactively to the date coverage otherwise would have ceased. How Long Can COBRA Continuation Coverage Last? COBRA continuation coverage under the Plan may be continued through the end of the calendar year in which your qualifying event occurs. COBRA continuation coverage under the Plan will be terminated for any affected qualified beneficiary before the end of the maximum period described above on the earliest of the following dates: The first day of the period for which any required contribution is not paid in full on time, The date the qualified beneficiary first becomes covered, after electing COBRA continuation coverage, under another group health plan that does not impose any pre-existing condition exclusion for a pre-existing condition of the qualified beneficiary, The date the qualified beneficiary first becomes entitled to Medicare benefits (under Part A, Part B, or both) after electing COBRA continuation coverage, or The date Administaff ceases to provide any group health plan for its employees. COBRA continuation coverage may also be terminated for any reason the Plan would terminate coverage of a participant or beneficiary not receiving COBRA continuation coverage (such as fraud). Coverage that has been canceled for any of these reasons cannot be reinstated. A qualified beneficiary must notify the Plan Administrator as soon as reasonably possible if, after electing COBRA continuation coverage, he or she obtains other group health plan coverage or Medicare benefits as described above. See the Notice Procedures above for how to notify the Plan Administrator of these other coverages