Eligible employees of Progress Energy Florida, Inc. (bargaining unit employees)

Transcription

1 Document title: Employees Group Comprehensive Medical Plan of Progress Energy Florida, Inc. and Mental Health/Substance Abuse and EAP Plan of Progress Energy Florida, Inc. Document number: HRI-PGNF Applies to: Keywords: Eligible employees of Progress Energy Florida, Inc. (bargaining unit employees) human resources information; benefits booklets Summary Plan Description Progress Energy, Inc. Employer Identification No Plan No. 526 Effective January 1, 2012 (unless otherwise noted) This document is a Summary Plan Description (SPD) for the Employees Group Comprehensive Medical Plan of Progress Energy Florida, Inc. (the medical plan ) and the Mental Health/Substance Abuse and EAP Plan of Progress Energy Florida, Inc. (the MHSA and EAP Plan ) (each a plan and together the plans ), component plans under the Progress Energy, Inc. Welfare Benefit Plan (the Plan ), sponsored by Progress Energy, Inc. (Progress Energy or the company). An SPD is a summary of the official plan documents that govern the terms, conditions and administrative operations of a benefit plan that is subject to the Employee Retirement Income Security Act of 1974 (ERISA). It does not describe every plan provision in full detail, and it does not alter any plan or any legal instrument related to the plans creation, operations, funding or benefit payment obligations. Every effort has been made to ensure that this document reflects relevant plan provisions in effect as of January 1, However, if there are any inconsistencies between this document and the official plan documents (including any insurance contracts), the terms and conditions of the applicable official plan documents (including any insurance contracts) will govern. In no case does this document imply or guarantee any right of future employment. Regular, full-time bargaining unit employees and retirees and their eligible dependents of Progress Energy Florida, Inc. (Progress Energy Florida) are eligible to participate in: The Employees Group Comprehensive Medical Plan of Progress Energy Florida, Inc. (Enrollment in the medical plan also provides access to coverage for prescription drugs, as well as mental health & substance abuse services under the MHSA and EAP Plan.) The employee assistance program (EAP) portion of the MHSA and EAP Plan of Progress Energy Florida, Inc. (Surviving dependents are not eligible for EAP services, except through COBRA. Full-cost retirees are not eligible for EAP only coverage.) Temporary bargaining unit employees and their eligible dependents of Progress Energy Florida are eligible to participate in: The employee assistance program (EAP) portion of the MHSA and EAP Plan Progress Energy reserves the right to amend or terminate the plans or any plan s benefits at any time based on the cost of the benefits or other considerations without prior approval of or notification to any party. HRI-PGNF Rev. 10 Page 1 of 129

2 Reference Documents and Forms FRM-PGNF-00008, FlexPower Benefits Change Form FRM-SUBS-01117, Catalyst Rx Reimbursement Form FRM-SUBS-20112, Walgreens Mail Service Registration and Prescription Order Form HRI-SUBS-30003, Your Guide to the HDHP and HSA Option HRI-SUBS-30004, Guide to Benefits for Domestic Partners FRM-SUBS-00879, Blue Cross Blue Shield of North Carolina Member Claim Form FRM-SUBS-01112, ValueOptions Claim Form HRI-PGNF Rev. 10 Page 2 of 129

3 Eligibility Pgs 4-8 Newly Eligible Employees 4 Dependents 4 QMCSO 5 Employment of Both You & Your Dependent 6 by Progress Energy Leaves of Absence 6 Retired Employees 6 Age and Service Requirements 6 Retiree Medical Caps 7 Enrollment and Changes Pgs 9-12 Enrollment for Newly Eligible Employees 9 Levels of Coverage 9 Enrolling Dependents 9 Enrollment for Newly Eligible Retirees 10 Changing Your Elections 10 Annual Benefits Enrollment 10 Qualifying Events 10 Medical Plan Pgs Section Contents 13 Important Medical Plan Information 14 BCBSNC HDHP 18 BU BCBSF-750 & BU BCBSF Options AvMed and BlueCare HMOs 66 AUTHORIZED COPY Table of Contents COBRA Coverage Pgs Eligibility for COBRA 115 Plans Covered Under COBRA 115 Responsibility of Employer to Provide 115 Notice Your Responsibility to Notify Your Employer 116 Cost of COBRA Coverage 116 Maximum Period of Coverage 116 Termination of COBRA Coverage 117 Other COBRA Information 118 Other Important Information Pgs Section Contents 120 Plan Information 121 Plan Administration 123 Your Rights Under ERISA 126 Contact Information Pgs Employee Service Center 128 Benefits Administrators 128 MHSA & EAP Plan Pgs Section Contents 73 EAP-ValueOptions 74 MHSA Services ValueOptions 77 MHSA Services for the HDHP 84 BCBSNC/Magellan Claims and Appeals Pgs Acts of Third Parties 89 Benefit Claims and Appeals Procedures 90 Medical Claims Filing 98 BCBSNC Medical Appeals Process 100 BCBSF PPO Medical Appeals Process 103 AvMed HMO and BlueCare HMO Medical 104 Appeals Process ValueOptions Claims Filing 105 ValueOptions Appeals Process 106 BCBS/Magellan Claims Filing 110 BCBS/Magellan Appeals Process 111 When Coverage Ends Pgs When Eligibility Ends 113 When Eligibility Ends for Dependents 113 When Coverage Ends 113 HIPAA Certificates of Coverage 114 HRI-PGNF Rev. 10 Page 3 of 129

4 Eligibility Eligibility The plans cover employees and retirees and their dependents who meet the eligibility requirements specified herein. Certain employees who are eligible for the plans are represented by the International Brotherhood of Electrical Workers. Leased employees as defined in Section 414(n) of the Internal Revenue Code and independent contractors are not covered by the plans. Newly Eligible Employees FlexPower is the benefits program Progress Energy offers to certain bargaining unit employees to provide them with the flexibility to choose from a variety of benefit options and coverage levels. Below are some of the benefits that make up the FlexPower program. Medical Regular, full-time bargaining unit employees are eligible to enroll in one of the Progress Energy-sponsored medical plan options (includes prescription drug coverage, as well as mental health and substance abuse coverage under the MHSA and EAP Plan) on the first day of employment or reclassification (i.e., change from non-bargaining classification to bargaining unit classification) with Progress Energy Florida. Temporary employees are not eligible for coverage under the medical plan. You and your employer share the cost of medical coverage. Payroll deductions are taken on a before-tax basis. For newly eligible employees, payroll deductions begin with the paycheck following processing of your enrollment. Mental Health and Substance Abuse (MHSA) Regular, full-time bargaining unit employees who are enrolled in one of the Progress Energy-sponsored medical plan options are eligible for mental health and substance abuse services on the first day of employment or reclassification (i.e., change from non-bargaining classification to bargaining unit classification) with Progress Energy Florida. Employee Assistance Program (EAP) Regular, full-time and temporary bargaining unit employees and all members of their households are eligible to receive EAP services on the first day of employment or reclassification (i.e., change from non-bargaining classification to bargaining unit classification) with Progress Energy Florida. Progress Energy Florida pays the full cost of coverage for EAP services. Dependents If you are eligible for and you elect medical coverage for yourself, you may also elect to cover your eligible dependents. Dependent eligibility for prescription drug and MHSA coverage requires participant and dependent enrollment in one of the Progress Energy-sponsored medical plan options. Each eligible dependent must be listed by name, Social Security number, relationship and date of birth in order to be covered. Eligible dependents under the medical plan (includes prescription drug coverage, as well as mental health and substance abuse coverage under the MHSA and EAP Plan) are: Your spouse or domestic partner 1 HRI-PGNF Rev. 10 Page 4 of 129

5 Eligibility Children under age 26 who: Are your biological children; or Have been placed with you for legal adoption, whether or not the adoption has become final; or Are your stepchildren or domestic partner s children; or Are your foster children; or Are your ward under a legal guardianship appointment or for whom you have legal custody under a valid court decree. Your unmarried children age 26 or older 2 : Who are incapable of self-support because of mental or physical disability, provided they became disabled before age 26, and Who either live with you or live in a long-term care facility and are mainly dependent upon you or your spouse or domestic partner for support and care 3, and For whom you can provide proof of their incapacity, residency, and dependency continuously since age Your domestic partner is eligible only if you both satisfy the criteria described in the Declaration of Domestic Partner Relationship and have submitted a Declaration of Domestic Partner Relationship form to the Employee Service Center. The Guide to Benefits for Domestic Partners (HRI-SUBS-30004) and forms are available through ProgressNet or from the Employee Service Center at or employee.service@pgnmail.com. Such documents are hereby incorporated by reference and made a part of this SPD. The Guide also provides an explanation of the tax implications of covering your domestic partner on a before-tax basis. Your former spouse (by divorce, legal separation or annulment) and former stepchildren may not be covered under these plans unless the two of you remarry (or reconcile in the case of legal separation); likewise, your former domestic partner and domestic partner s children may not be covered unless you and your former domestic partner re-establish a domestic partner relationship or marry. 2 For children who are disabled, you must notify the Employee Service Center within 30 days of the child reaching age 26 and provide the necessary documentation. 3 To determine if you provide more than half of a child s support, you must first determine the total support provided for that child. Total support includes amounts spent to provide food, lodging, clothing, education, medical and dental care, recreation, transportation and similar necessities. Note: Employees who cover ineligible dependents are in violation of the company s Code of Ethics. They may be required to pay damages and costs to the company, including reimbursement of any benefit payments made with respect to an ineligible dependent. Qualified Medical Child Support Order A qualified medical child support order (QMCSO) is an order issued by a court or through a state administrative process established under state law. In addition, national medical support notices must be treated as QMCSOs. A QMCSO directs the Plan Administrator to cover a child for benefits under the health care plan. Upon receipt of the order, the Plan Administrator will review the order to determine whether or not it is a QMCSO. During this review period, the Plan Administrator will instruct the applicable Benefits Administrator to hold all claims that may be payable for the children named in the order. The Plan Administrator will notify in writing all persons named in the order of the determination. If the Plan Administrator determines the order is a QMCSO, its terms must be followed to the extent required by law. If you are subject to a QMCSO, you must pay the appropriate cost of coverage as for any dependent coverage. If the Plan Administrator determines the order is not a QMCSO, a revised order may be prepared for submission and review. The Plan Administrator will instruct the applicable Benefits Administrator to discontinue holding claims at the time an order is determined not to be a QMCSO. If a revised order is submitted and determined to be a QMCSO, the Benefits Administrator will pay any claims on behalf of the child to the extent required by the revised order. HRI-PGNF Rev. 10 Page 5 of 129

6 Eligibility Employment of Both You and Your Dependent by Progress Energy If both you and your dependent are employed by a participating subsidiary of Progress Energy, each of you may elect to be covered under different Progress Energy-sponsored medical plans. Or, one of you may elect the No Coverage option and be covered as a dependent by the other. You may not be covered both as an employee and as a dependent under the Progress Energy-sponsored medical plans. These same restrictions apply if your dependent is a nonbargaining unit employee of a participating subsidiary of Progress Energy. Also, if an employee and spouse or domestic partner are both employed by a participating subsidiary of Progress Energy, only one of you may cover your children, stepchildren or domestic partner children. Leaves of Absence If you make the required contributions, you and your eligible dependents may continue medical (includes prescription drug coverage, as well as mental health and substance abuse coverage under the MHSA and EAP Plan) and EAP coverage for yourself and your eligible dependents while you are on a leave of absence as permitted in the Employee Handbook for: Newborn care Adoption/foster care Military service Any other absence that qualifies under the Family and Medical Leave Act Retired Employees Age and Service Requirements If you retire and meet the age and service requirements described below, you may be eligible to continue Progress Energy-sponsored medical (includes prescription drug coverage, as well as mental health and substance abuse coverage under the MHSA and EAP Plan) and EAP coverage after retirement based on those specific age and service eligibility requirements. In determining whether the specified retirement age and service requirements have been met, "service" includes years of employment as an eligible employee (as defined above) with Progress Energy Florida. Service with a nonparticipating employer will be included only if service was also incurred with Progress Energy Florida. A nonparticipating employer is an employer that is within Progress Energy's controlled group of companies (as defined in Internal Revenue Code Section 1563) but that does not offer these plans to its employees. The following are the retirement age and service requirements that must be met to continue Progress Energysponsored medical (includes prescription drug coverage, as well as mental health and substance abuse coverage under the MHSA and EAP Plan) and EAP coverage: Age 65 or older with at least 5 years of continuous service*; or Age 55 or older with at least 15 years of continuous service*; or Disabled and approved for Long-term Disability retirement under the Retirement Plan for Bargaining Unit Employees of Florida Progress Corporation. * You earn a year of continuous service when you work (or are paid for) 1,000 hours in a calendar year. Continuation of medical coverage after retirement Bargaining unit employees who are retired from the company as a normal, early, or disability retirement, including employees who terminated between June 1 and December 1, 2005 pursuant to the terms of the Voluntary Enhanced Retirement Program ( the Program ), are eligible for Progress Energy-sponsored retiree medical (includes prescription drug coverage, as well as mental health and substance abuse coverage under the MHSA and EAP Plan) HRI-PGNF Rev. 10 Page 6 of 129

7 Eligibility and EAP coverage on themselves and their eligible dependents. Retirees with a deferred vested pension are not eligible for Progress Energy-sponsored retiree medical (including prescription drug coverage, as well as mental health and substance abuse coverage under the MHSA and EAP Plan) and EAP coverage. If you are a retiree, including retirees receiving benefits under the terms of the Program, or a surviving dependent and elect the No Coverage option, you will permanently lose your eligibility for Progress Energy-sponsored medical (including prescription drug coverage, as well as mental health and substance abuse coverage under the MHSA and EAP Plan) and EAP coverage for you and your dependents. Surviving spouses or domestic partners who elect the No Coverage option due to eligibility for other employer-sponsored coverage will be eligible to elect coverage as a surviving dependent within 30 days of loss of the other coverage. Cost of medical coverage after retirement Eligible employees who retired prior to January 1, 1993 do not contribute toward the cost of retiree, spouse or domestic partner coverage. Dependent child coverage is paid 100% by the retiree. Eligible employees who were hired or rehired prior to January 1, 2009 and retire on or after January 1, 1993 contribute toward the cost of retiree and spouse or domestic partner coverage based on the age/service matrix percentage at retirement. Dependent child coverage is paid 100% by the retiree. Eligible employees who are hired or rehired on or after January 1, 2009 have access to retiree coverage if they meet the age and service requirements described above, but pay the full cost of coverage. Retiree Medical Caps Effective January 1, 1998, retiree medical funding caps were implemented that would eventually affect the cost of medical benefits for some retired employees. Once met, medical caps limit the annual dollar amount of company contributions to retiree medical benefits. The medical caps are based on the average cost per participant and the expected rate of medical inflation. As the applicable limits are reached, company contributions are "capped" and future premium increases are paid by plan participants. How the medical caps apply: Current retirees who retired prior to January 1, 1998 are not subject to the retiree medical funding caps. Current retirees who retired on or after January 1, 1998 are subject to the retiree medical funding caps. Active employees, who eventually qualify for subsidized retiree medical coverage and retire, are subject to the retiree medical funding caps. How the caps work (effective January 1, 1998): There are separate pre-65 and post-65 caps, with the post-65 cap taking effect when the covered retiree reaches age 65. The annual total cost caps are: Pre-65 $6,500 (medical cap on company contributions met January 1, 2012) Post-65 1 $3,500 (medical cap on company contributions met January 1, 2011) 1 Retirees and dependents that are Medicare eligible due to disability prior to age 65 are subject to the Post-65 cap. The premiums and funding cap for post-65 retiree medical coverage were set lower than the pre-65 premiums and funding cap because Medicare becomes the primary coverage (and the Progress Energy plan provides secondary coverage) when an individual reaches age 65 or becomes Medicare eligible due to disability. Retirees and their covered dependents are required to move from pre-65 coverage to post-65 coverage in the year when either they or their covered dependents reach age 65 or become Medicare eligible due to disability. This is necessary because Medicare will become primary to (or pay benefits before) the retiree medical coverage for either the retiree, or his or her covered dependents. However, the determination of whether the total cost for a retiree and his or her covered dependents counted toward the pre- or post-65 cap calculation was based on the retiree s age. For example, the total cost for a retiree age 65 or older whose spouse or domestic partner was not yet age 65 counted HRI-PGNF Rev. 10 Page 7 of 129

8 Eligibility toward the post-65 cap calculation. Likewise, the total cost for a retiree under age 65 whose spouse or domestic partner was age 65 or older counted toward the pre-65 cap calculation. Calculating the caps To determine when each cap was reached, the total cost of pre- and post-65 retiree coverage (claims plus administrative costs) was divided by the total number of participants (both retirees and dependents) in each group. This calculation produced an average cost per participant for each group that was monitored on an ongoing basis until these caps were met. Once the caps were met, the employer-provided subsidy for affected retirees was capped and continues at that level for the foreseeable future. Beginning in 2002, bargaining unit retiree plan costs were segregated from non-bargaining retiree plan costs so costs were accurately monitored for comparison with the caps. Caps will affect premiums only The caps do not affect the benefits payable under the plan; they apply only to the funding of premiums. For example, a post-65 retiree is not limited to $3,500 of benefits. Likewise, a pre-65 retiree is not limited to $6,500 of benefits. The caps only impact the monthly premiums. HRI-PGNF Rev. 10 Page 8 of 129

9 Enrollment and Changes Enrollment and Changes Enrollment for Newly Eligible Employees As a regular, full-time bargaining unit employee, you must enroll yourself and your eligible dependents in the medical plan within 30 days of your employment date or reclassification date. Also, you must enroll through Employee Self Service or on the enrollment form to elect the appropriate coverage and list each dependent by name, Social Security number, relationship and date of birth before any benefits may be paid. Coverage will be effective on your date of hire or reclassification if your elections are made within 30 days of such date. There are no pre-existing condition exclusions for you or your dependents for the medical or MHSA coverage. Levels of Coverage If you enroll in the medical plan, there are three levels of coverage available: Self (employee only) Self plus one (employee plus one eligible dependent) Family (employee plus two or more eligible dependents) Medical If you are a regular, full-time bargaining unit employee and you do not enroll in a medical plan option within 30 days of becoming eligible, you will be automatically enrolled with employee only coverage under the BU BCBSF-750 option. Your dependents will not be covered. The effective date of coverage will be your date of hire or reclassification. Note: If you are a regular, full-time bargaining unit employee, you may elect the No Coverage option only if you are covered by another medical plan. If you elect the No Coverage option, you must complete the "proof of other medical coverage" section through Employee Self Service or on the employer-provided enrollment form within 30 days of your election. If you provide evidence of other coverage within 30 days, coverage will be waived retroactive to the date you requested No Coverage. If you present evidence after 30 days, the change will be effective the date the evidence is provided. If you decline medical coverage for yourself, you may not enroll your dependents. MHSA and prescription drugs Your enrollment and the enrollment of your eligible dependents in one of the Progress Energy-sponsored medical plan options automatically enrolls you in the MHSA benefit under the MHSA and EAP Plan and gives you access to prescription drug coverage. An additional election is not required. Enrolling Dependents You must cover yourself under one of the medical plan options in order to enroll your eligible dependents. Each dependent must meet the eligible dependent definition (see Dependents in the Eligibility section). Also, you must elect the appropriate level of coverage (self, self plus one or family) and list each dependent by name, Social Security number*, relationship and date of birth through Employee Self Service or on the employer-provided enrollment form before benefits can be paid. Coverage will be effective on your hire or reclassification date if you enroll within 30 days of such date. Please see the Guide to Benefits for Domestic Partners (HRI-SUBS-3004) for an explanation of the tax impact of paying premiums for your domestic partner on a before-tax basis. HRI-PGNF Rev. 10 Page 9 of 129

10 Enrollment and Changes *Note: The Mandatory Insurer Reporting Law (Section 111 of Public Law ) requires group health plan insurers, third party administrators, and plan administrators of self-insured group health plans to report Social Security numbers for certain covered members. To comply with this legislation, Progress Energy needs Social Security numbers for dependents covered under any company-sponsored medical plan. If you do not have the dependent's Social Security number, you should complete the rest of the information and submit your enrollment. You must call the Employee Service Center and add the dependent's Social Security number as soon as you receive it. Note: Employees who cover ineligible dependents are in violation of the company s Code of Ethics. They may be required to pay damages and costs to the company, including reimbursement of any benefit payments made with respect to an ineligible dependent. Enrollment for Newly Eligible Retirees As a newly eligible retiree, you may continue medical coverage at rates based on the age and service matrix. You will need to complete a bargaining unit retiree enrollment form to indicate which medical plan option you wish to select within 30 days of your retirement date. Coverage will be effective on your retirement date. Deductions will begin with your second pension check. If there is not a monthly pension check, you will receive a bill for your benefits on a monthly basis. If you waive your coverage at retirement or after, then coverage for you and your covered dependents will be permanently lost (except if you enroll in a Medicare Advantage Plan, you may re-enroll within 30 days if you lose coverage under that Medicare Advantage Plan). If you drop any covered dependents, the dependents will permanently lose eligibility for Progress Energy-sponsored medical coverage. Changing Your Elections After the 30-day newly eligible employee enrollment period has expired, you may not change your elections until the next annual enrollment period for medical coverage unless you have a qualifying event in your family or employment status. Annual Benefits Enrollment You may change your medical election each year during annual benefits enrollment. Elections made during annual benefits enrollment are effective January 1 through December 31 of the following year (or through some earlier date if coverage ends as described in the When Coverage Ends section if you make an election change upon a qualifying event). There are no pre-existing condition exclusions for you or your dependents under the medical plan and MHSA and EAP Plan. Qualifying Events The Internal Revenue Service rules do not permit you to change your FlexPower elections during the plan (calendar) year unless you have a qualifying event. If you experience a qualifying event, a completed employer-provided FlexPower Benefits Change Form (FRM-PGNF-00008) must be received by the Employee Service Center within 30 days of the event to modify your coverage (or 60 days for certain events as noted below). Changes due to birth, adoption or placement for adoption (a subset of HIPAA special enrollment right events) may be effective retroactively back to the date of the birth, adoption or placement for adoption, as long as such date is no more than 30 days prior to the date of notification, subject to the provisions of the underlying group health plan. All other changes may only be effective on a prospective basis and no earlier than the first day of the pay period after the FlexPower Benefits Change Form is received by the Employee Service Center. Otherwise, you will have to wait until the next annual enrollment period. All election changes must be consistent with the qualifying event and the following participant group guidelines. HRI-PGNF Rev. 10 Page 10 of 129

11 Enrollment and Changes Regular, full-time bargaining unit employees and employees on a leave of absence may not make changes to their medical election until the next benefits enrollment period unless they have a qualifying event. Retired participants may not add dependents to their coverage unless they experience a qualifying event. However, they may elect to drop coverage or dependents without a qualifying event at any time during the year. Retired participants who drop coverage for themselves will permanently lose eligibility for themselves and their covered dependents. If a retired participant drops any covered dependents, the dependents will permanently lose eligibility for Progress Energy-sponsored medical (includes prescription drug coverage, as well as mental health and substance abuse coverage under the MHSA and EAP Plan) and EAP coverage. COBRA participants may not add dependents to their coverage until the next benefits enrollment period unless they have a qualifying event. However, they may elect to drop coverage or dependents without a qualifying event at any time during the year. Changes made as a result of a qualifying event must be requested within 30 days (or 60 days for certain events noted below) of, and be consistent with, the qualifying event. Qualifying events do not allow you to change from one medical plan option to another unless you relocate and the new location is outside of the option s service area or unless you are making a change pursuant to a HIPAA special enrollment right event (i.e., gaining a new dependent via marriage, birth, adoption or placement for adoption; losing other coverage; or the Medicaid/CHIP events listed in the last two bullets below). Also note that a physician/hospital leaving the network does not constitute a qualifying event. Qualifying events include: Your marriage or fulfillment of all Progress Energy domestic partner relationship requirements. Legal separation, annulment, divorce or termination of domestic partner relationship. Birth, adoption or placement for adoption, or change in custody of your child. Death of your spouse, domestic partner or child. Loss of dependent status (e.g., child reaching age 26). You, your spouse, domestic partner or child takes or returns from an unpaid leave of absence. 1 Your spouse s, domestic partner s, child s or your health care coverage changes significantly (attributable to your spouse s, domestic partner s or child s employment or change in student status or to a significant cost change or coverage curtailment). 1 Your spouse's, domestic partner s, or child s employer conducts an annual enrollment and your spouse, domestic partner or child changes his or her benefit elections. 1 You, your spouse, domestic partner or child changes from part-time to full-time employment or from full-time to part-time employment and that change impacts eligibility for coverage. 1 Your spouse or domestic partner or child becomes employed or unemployed. 1 You, your spouse, domestic partner or child changes place of work or permanent residence (and the new location is outside of the option s service area). You, your spouse, domestic partner or child loses eligibility for Medicaid or Children s Health Insurance Program (CHIP) coverage. 2 You, your spouse, domestic partner or child becomes eligible to participate in a premium assistance program under Medicaid or CHIP. 2 1 Qualifying event does not apply to retirees, surviving dependents, or children of retirees or surviving dependents. 2 Employee must notify the Employee Service Center within 60 days of loss of Medicaid/CHIP eligibility or of the premium assistance eligibility determination. All other qualifying events must be communicated to the Employee Service Center within 30 days of the event. HRI-PGNF Rev. 10 Page 11 of 129

12 Enrollment and Changes In order to cover a new dependent due to a qualifying event, you must complete an employer-provided FlexPower Benefits Change Form (FRM-PGNF-00008) or a retiree change form even if you already have family coverage. The new dependent s name, Social Security number*, relationship and date of birth must be listed on the form. If the Employee Service Center does not receive the form within 30 days of the event (or 60 days for certain events as noted above), the dependent may not be added to your coverage until the next enrollment period. *Note: The Mandatory Insurer Reporting Law (Section 111 of Public Law ) requires group health plan insurers, third party administrators, and plan administrators of self-insured group health plans to report Social Security numbers for certain covered members. To comply with this legislation, Progress Energy needs Social Security numbers for dependents covered under any company-sponsored medical plan. If you do not have the dependent's Social Security number, you should complete the rest of the information and submit your enrollment. You must call the Employee Service Center and add the dependent's Social Security number as soon as you receive it. When a dependent is no longer eligible for coverage, you must complete an employer-provided FlexPower Benefits Change Form (FRM-PGNF-00008) or a retiree change form within 30 days of the qualifying event to remove the dependent from coverage and reduce your premiums if applicable. Termination of coverage will be effective on the date your dependent ceases to be eligible for coverage. Premiums will not be refunded retroactively. If you do not remove the dependent from coverage, you will be covering an ineligible dependent. Note: Employees who cover ineligible dependents are in violation of the company s Code of Ethics. They may be required to pay damages and costs to the company, including reimbursement of any benefit payments made with respect to an ineligible dependent. HRI-PGNF Rev. 10 Page 12 of 129

13 Medical Plan Section Contents Medical Plan Important Medical Plan Information Pgs Medical Plan Coverage Options 14 Medicare Part D 16 Maintenance of Benefits 17 BCBSNC High Deductible Health Plan Pgs Enrollment Eligibility 18 Medical and Prescription Drug ID Card 18 BCBSNC HDHP Summary Chart 19 How the HDHP Works 21 Utilization Management (UM) Program 23 Care Management 25 Condition Management 26 Covered Expenses 27 Expenses Not Covered 35 BU BCBSF-750 & BU BCBSF-1500 Options Pgs Enrollment Eligibility 40 Medical and Prescription Drug ID Cards 40 BU BCBSF-750 Summary Chart 42 BU BCBSF-1500 Summary Chart 44 How the BU BCBSF-750 & BU BCBSF Options Work Utilization Review (UR) Program 49 Case Management 50 Condition Management 50 Covered Expenses 51 Expenses Not Covered 61 HMOs Pgs Enrollment Eligibility 66 Medical and Prescription ID Cards 66 AvMed HMO Summary Chart 67 BlueCare HMO Summary Chart 69 How the HMOs Work 71 Covered Services and Exclusion 72 HRI-PGNF Rev. 10 Page 13 of 129

14 Important Medical Plan Information AUTHORIZED COPY Medical Plan Important Medical Plan Information Your eligibility and enrollment in one of the Progress Energy-sponsored medical plan options gives you access to coverage for prescription drugs, as well as mental health and substance abuse services under the MHSA and EAP Plan. Medical Plan Coverage Options Active employees If you are eligible for Progress Energy-sponsored medical plan coverage, and are not a retiree or surviving dependent, you may choose from the following options: High Deductible Health Plan (administered by BCBSNC) BU BCBSF-750 (PPO $750 deductible option) (administered by BCBSF) BU BCBSF-1500 (PPO $1,500 deductible option) (administered by BCBSF) AvMed HMO (administered by AvMed) BlueCare HMO (administered by BCBSF) No Coverage 1 If you are an active, regular full-time bargaining unit employee and your covered spouse, domestic partner or child(ren) are Medicare eligible, you may choose from all of the available options above. 1 Note: If you are a regular full-time employee, you may elect the No Coverage option only if you are covered by another medical plan. If you elect the No Coverage option, you must provide evidence of other coverage within 30 days of your election. If you provide evidence of other coverage within 30 days, coverage will be waived retroactive to the date you requested No Coverage. If you present evidence after 30 days, the change will be effective the date the evidence is provided. Retiree and surviving dependents options (not Medicare eligible) If you are eligible for Progress Energy-sponsored medical plan coverage, and are a retiree or surviving dependent not entitled to Medicare, you may choose from the following options: High Deductible Health Plan (administered by BCBSNC) BU BCBSF-750 (PPO $750 deductible option) (administered by BCBSF) AvMed HMO (administered by AvMed) BlueCare HMO (administered by BCBSF) No Coverage 2 2 Note: If you are a retiree or surviving dependent and elect the No Coverage option for yourself and/or any eligible dependents at retirement or anytime thereafter, you will permanently lose your eligibility for Progress Energysponsored medical plan coverage for you and your dependents (unless you are covered by your spouse s or domestic partner s active Progress Energy-sponsored medical plan at retirement and you subsequently lose coverage under that plan, in which case you can enroll in one of the medical plan options within 30 days of losing coverage). If coverage is dropped for any covered dependents, the dependents will permanently lose eligibility for Progress Energy-sponsored medical plan coverage. HRI-PGNF Rev. 10 Page 14 of 129

15 Medical Plan Important Medical Plan Information Retiree and surviving dependents options (Medicare eligible) If you are eligible for Progress Energy-sponsored medical plan coverage, are retired and you or your dependent is entitled to Medicare, or if you are a Medicare-eligible surviving dependent, you may choose from the following options: BU BCBSF-750 (PPO $750 deductible option) (administered by BCBSF) Medicare Advantage Plans with this option you are electing to opt out of the Progress Energy-sponsored medical plan and obtain coverage on an individual basis with a Medicare Advantage Plan. You will have no medical coverage through Progress Energy but will have the ability to come back to the Progress Energysponsored plans at annual benefits enrollment or if your Medicare Advantage Plan is lost. No Coverage 3 3 Note: If you are a retiree or surviving dependent and elect the No Coverage option for yourself and/or any eligible dependents at retirement or anytime thereafter, you will permanently lose your eligibility for Progress Energysponsored medical plan coverage for you and your dependents (unless you are covered by your spouse s or domestic partner s active Progress Energy-sponsored medical plan at retirement and you subsequently lose coverage under that plan, in which case you can enroll in one of the medical plan options within 30 days of losing coverage). If coverage is dropped for any covered dependents, the dependents will permanently lose eligibility for Progress Energy-sponsored medical plan coverage. Retired employees, dependents of retired employees, and surviving dependents who are entitled to Medicare may not be covered under the High Deductible Health Plan, AvMed HMO or BlueCare HMO. If you are under age 65 and enrolled in the High Deductible Health Plan, AvMed HMO or BlueCare HMO, you will need to change to the BU BCBSF-750 or the Medicare Advantage Plan option during the annual enrollment for the year in which you or your covered dependent will turn 65 or become Medicare eligible due to disability or no later than the month in which you or your covered dependent turns age 65 or becomes Medicare eligible. Other employer-sponsored coverage When you or a dependent are covered under a Progress Energy-sponsored plan and another employer-sponsored plan, one plan is considered the primary plan and the other is the secondary plan. The primary plan pays claims first and the secondary plan pays claims after the primary plan has paid. Primary and secondary responsibility for a claim is usually determined as follows: The plan without a claims coordination provision will be primary and the plan with a claims coordination provision will be secondary. When both plans have coordination provisions, the plan covering the patient as an active employee will be primary. A plan that covers an active employee or a dependent of an active employee will be primary to a plan that covers the patient as an inactive (retired or terminated) employee or as a dependent of an inactive employee. If a determination of responsibility cannot be made using the above guidelines, the plan that has covered the patient the longest will be the primary plan. Dependent children If a dependent child is covered by two or more employer-sponsored plans, the "birthday rule" will apply unless there has been a divorce. Under the birthday rule, the plan of the parent whose birthday occurs first in the year is primary regardless of the year of birth. For example, the plan of the parent with a February birthday is primary to the parent with a May birthday. If a plan does not contain the birthday rule, the rule set forth in that plan will determine the order of benefits. HRI-PGNF Rev. 10 Page 15 of 129

16 Medical Plan Important Medical Plan Information If there has been a divorce and the courts have assigned financial responsibility for a child s health care to one parent, that parent s plan is primary. Otherwise, in the case of divorce: The plan of the parent with custody pays first, and the plan of the stepparent pays second. The plan of the parent without custody pays third (second if there is no stepparent or the stepparent does not participate in an employer-sponsored medical plan). Medicare eligible participants Active employees If you are actively employed, the Progress Energy-sponsored medical plan will be primary and Medicare will be secondary in accordance with the following principles: For you, if you are covered by both the Progress Energy-sponsored medical plan and Medicare. For your dependent, if you have a Medicare-eligible dependent covered under a Progress Energy-sponsored medical plan. For you or your dependent, during the first 30-months of eligibility or entitlement to Medicare based solely on end stage renal disease (ESRD). After 30 months, Medicare will be primary. Retirees or surviving dependents If you are a retiree or a surviving dependent, Medicare will be primary and the Progress Energy-sponsored medical plan will be secondary in accordance with the following principles 4 : For you, if you are retired or a surviving dependent and are age 65 or over. For you, if you are disabled and are entitled to Medicare (regardless of your age). For you, if you are eligible for disability retirement benefits and have received Social Security benefits for 24 months (regardless of your age). For your dependent, if you have a Medicare-eligible dependent covered under a Progress Energy-sponsored plan and you are retired or eligible for disability retirement benefits (regardless of your age). Pre age 65 for you or your dependent, after the first 30 months of eligibility or entitlement to Medicare based solely on end stage renal disease (ESRD). Post age 65 Medicare will remain primary for you or your dependent even if you become eligible for Medicare based on end stage renal disease (ESRD). 4 You should send the Employee Service Center a copy of the Medicare card within 30 days of becoming eligible for Medicare so your coverage and premium may be changed appropriately. You should apply for and purchase Medicare Part B when you or your dependent first become eligible for Medicare, and you should use providers who accept Medicare. The Benefits Administrator will assume you have purchased Medicare Part B and use providers who accept Medicare, and will coordinate benefits accordingly, whether or not you are actually covered under Part B or actually use providers who accept Medicare. This means that if you do not enroll in Medicare Part B when you become eligible or if you use providers who do not accept Medicare and then incur expenses that would be covered by Medicare Part B, you will be responsible for paying the full cost of those expenses. They will not be covered or paid by the Progress Energy plan. Medicare Part D If you participate in a Progress Energy medical plan, you may continue receiving your prescription drugs through the Progress Energy medical plan and not elect a separate Medicare Part D plan. The company will provide a certificate of creditable coverage you can use to avoid any Medicare Part D plan premium increase that would otherwise be required if you choose to enroll in a Medicare Part D plan at a later date. HRI-PGNF Rev. 10 Page 16 of 129

17 Maintenance of Benefits AUTHORIZED COPY Medical Plan Important Medical Plan Information When you or a dependent is covered under the Progress Energy-sponsored medical plan and another employersponsored medical plan (or Medicare) and the Progress Energy-sponsored plan is secondary, benefits are coordinated through maintenance of benefits. Under maintenance of benefits, the Progress Energy-sponsored plan provides benefits only to make up the difference (if any) between what the other (primary) plan paid and what the Progress Energy-sponsored medical plan would have paid if it had been primary, using the lesser of the primary or secondary plan s allowed amount, subject to provider contract agreements. This means that 100% coverage between the two plans is not provided. You are responsible for any charges not paid by either plan, including any amounts in excess of the allowed (usual and customary) amount. Maintenance of benefits does not apply to the HMOs. See the HMO s Certificate of Coverage for coordination of benefit rules. Note: Employees who retired prior to January 1, 1993, are not subject to maintenance of benefits ("carve out") but are eligible for full coordination of benefits, which means that 100% coverage between the two plans is possible. Example: The following example shows how a claim would be paid under maintenance of benefits. The assumptions in this example are: (i) the primary plan paid the claim at 80%, after a $300 deductible; (ii) the Progress Energy BU BCBSF- 750 option was secondary; and (iii) the claim was for authorized outpatient services. Maintenance of benefits when Medicare is primary Total bill $2,000 Allowed amount $1,500 Primary plan (Medicare) Assume deductible has been met - $1,500 x 80% $ 1,200 Participant liability $ 300 Secondary plan (Progress Energy BU BCBSF-750 option) Assume deductible has been met - $1,500 x 80% $ 1,200 Participant liability $ 300 Since the secondary plan (Progress Energy) maximum liability is $1,200 (the same as Medicare, the primary plan), the Progress Energy plan will pay $0, leaving a balance of $300 to be paid by the participant. In general, Medicare participants would reach the out-of-pocket limit and have 100% coverage between the primary and secondary plans for covered expenses when their total medical expenses (not including prescription drugs, charges over the allowed amount, services not pre-certified or non-covered services) exceed $12,000 ($3,000 out-ofpocket consisting of the Progress Energy plan deductible and coinsurance). Prior to reaching the out-of-pocket limit the Progress Energy plan would pay $0, except for wellness exams and prescription drugs and expenses covered under the Progress Energy plan that are not covered by Medicare. HRI-PGNF Rev. 10 Page 17 of 129

18 Medical Plan BCBSNC High Deductible Health Plan BCBSNC High Deductible Health Plan (HDHP) The HDHP is a comprehensive plan that reimburses you for covered hospital and medical expenses on a fee-forservice basis. With the exception of preventive care services, all eligible services (including prescription drugs, as well as mental health and substance abuse services under the MHSA and EAP Plan) are subject to the HDHP deductible before benefit payments begin. Each time you need medical care, you decide if you want to use a provider who participates in BCBSNC s network of selected hospitals, physicians and other health care providers who have contracted to provide health care services at negotiated rates. If you use an in-network provider, you will be eligible for the highest level of benefits under the HDHP. Enrollment Eligibility To participate in the HDHP, you must meet the Progress Energy-sponsored medical plan eligibility criteria (see the Eligibility section) and be either an active regular, full-time bargaining unit employee of Progress Energy Florida, or a bargaining unit retiree of Progress Energy Florida under age 65 with no covered family members (including yourself) who are enrolled in Medicare. Participation in the HDHP also permits you to establish a Health Savings Account (HSA) as long as you are not: Covered under any medical plan that is not a high-deductible health plan Claimed as a dependent on anyone else s tax return Participating in or eligible for benefits from a general purpose health care reimbursement account (including that of your spouse) Receiving any Veterans Administration medical benefits For additional information about HSAs, see Your Guide to the HDHP/HSA Option which is incorporated by reference into this document and constitutes part of the SPD for the HDHP. Medical and Prescription Drug Identification (ID) Card If you enroll in the HDHP, you will receive a medical ID card but will not receive a separate prescription drug ID card. To purchase covered drugs at participating pharmacies, present your medical ID card to the pharmacist. The medical ID card should be presented to your physician and all other health care providers whenever services are received. HRI-PGNF Rev. 10 Page 18 of 129

19 Medical Plan BCBSNC High Deductible Health Plan 2012 BCBSNC HIGH DEDUCTIBLE HEALTH PLAN SUMMARY CHART This option pays 100% for covered in-network adult or child wellness expenses. For other covered expenses, after satisfying the annual deductible, the HDHP pays 100% for in-network and 100% of the allowed amount for out-of-network (60% for out-of-network preventive care). Each time medical care is needed, the patient decides which physician to use. A higher level of benefits applies when an in-network provider is used. Plan Provisions Note: Deductible and out-of-network (OON) preventive amounts shown are paid by participant Annual deductible 1 $2,500 self only/$5,000 self plus one or family in-network or OON Out-of-pocket limit 2 $2,500 self only/$5,000 self plus one or family in-network or OON Maximum lifetime plan benefit Unlimited The annual deductible does not apply to the following: Preventive care (primary diagnosis must be wellness) Mammograms Routine adult physical/wellness exams (including related tests and GYN exams) Well baby/child visits (including immunizations) The annual deductible applies to the following: Covered at 100% of allowed amount Covered at 100% in-network 40% OON 3 In-Network Out-of-Network 3 Physician office services (includes exams, diagnosis, lab services, non-surgical injections) Physician (includes family practice, OB/GYN, and Covered at 100% 4 Covered at 100% 4 internal medicine unless practicing in a specialty area) Specialist Office/surgical procedures (including MRI, PET, CT Covered at 100% 4 Covered at 100% 4 scans and nuclear medicine) Urgent care center 5 Covered at 100% Covered at 100% Emergency room 6 Covered at 100% Covered at 100% Hospital inpatient services 7 Covered at 100% 4 Covered at 100% 4, 8 Inpatient services (room, lab, x-ray) Providers (physician, surgeon, radiologist, anesthesiologist, pathologist, ER physician) Outpatient services Outpatient facility fee Outpatient facility services (lab, x-ray) Providers (physician, surgeon, radiologist, anesthesiologist, pathologist, ER physician) Covered at 100% 4 Covered at 100% 4 Occupational/physical/speech therapy; spinal Covered at 100% 4 Covered at 100% 4 manipulation 9 Durable medical equipment Covered at 100% 4 Covered at 100% 4 Mental health/substance abuse services 10 (deductible See the Mental Health & Substance Abuse Summary Chart. applies) Prescription drugs at participating BCBS Prime Therapeutics pharmacies 11, 12 (deductible applies) Retail (up to 30 days) Mail order (up to 90 days) Covered at 100% of allowed amount Specialty Deductible is the amount you must pay each calendar year before the plan pays a benefit. The deductible does not apply to preventive care. See Deductible section below for additional information. 2. Includes the deductible, but does not include charges in excess of the allowed amount, services not pre-certified, out-of-network (OON) HRI-PGNF Rev. 10 Page 19 of 129