NATIONAL MEDIA BENEFITS

The Employer's Solution

A Cost Effective Alternative to Insurance

The information contained in this document
is considered proprietary.

Company's health costs too high?
Looking for ways to reduce expenses and still provide excellent benefit levels?
Do you need coverage across state lines?
Tired of paying higher premiums even though claims are low?

The solution is right at your fingertips!
Introducing the NATIONAL MEDIA BENEFITS health plans

NATIONAL MEDIA BENEFITS

Introduction

Because of rapidly rising health care costs, employers are looking at other means of paying for health care benefits for their employees rather than the traditional fully-insured and self-insured plans available in the marketplace. As technology increases and pharmaceutical cures for once-fatal diseases are discovered, the costs of providing benefits are taking a larger and larger part of the business expense dollar. In addition, government entities are mandating additional benefits, further adding to the employers' burden. Employers must have access to a plan of benefits that will enable the employee to afford his or her share of the cost.

Costs for traditional, fully-insured plans continue to skyrocket with no end in sight. Because traditional self-insured plans have only been available to larger employers due to the complexity of the ERISA requirements, the expense of administration and the difficulty of purchasing appropriate stop-loss insurance, small employers (less than 100 employees) have not been able to avail themselves of this alternative. NATIONAL MEDIA BENEFITS (NMB) developed a concept, the NATIONAL MEDIA BENEFITS health plans, that deliver a positive solution to escalating medical benefit costs for the small employer by using all of the components required for a self- funded plan at a favorable cost and ease of administration tailored to their needs.

NATIONAL MEDIA BENEFITS

Plan Design Goals

Helping the Employer
Reduce Costs

NATIONAL MEDIA BENEFITS health plans are comprehensive in nature. Our health benefits specialists designed the most cost effective plans to meet the needs and budget of each employer. Preventive care is encouraged through Wellness programs and doctor visit copayments. Additional cost containment features include:
* Deductible and percentage payments;
* Co-pay requirements;
* Annual, lifetime or procedure maximums;
* Tiered drug card program with co-pays;
* Two (2) of the largest national Preferred Provider Networks;
* Pre-certification requirements; and
* Multiple plan options for groups using a defined contribution.

ERISA requires that a Plan include all Federal mandates such as COBRA and HIPAA, however, State mandates may not be forced on an ERISA self-funded plan.

NATIONAL MEDIA BENEFITS

Plan Summary Outlines

NATIONAL MEDIA BENEFITS health benefits specialists have designed plans with six levels of benefits: the Executive, Corporate Plus, Corporate, Secure Care, Indemnity and Basic Care I. A brief outline of each plan follows: Click on each plan name to view the Schedule of Benefits Summary .

MAJOR MEDICAL PLANS:

Plan Benefits: $2,000,000 Lifetime
Individual Deductible: $250 Network / $500 Non-Network (Applied separately)
Family Maximum Deductible: $750 Network / $1,500 Non-Network (Applied separately)
Payment Percentage: 90% Network / 70% Non-Network to $10,000; 100% thereafter
Doctor Office Co-Pay: $20 per visit   -   Specialist Office Co-Pay: $30 per visit
Wellness Benefit Co-Pay: $20 per visit; $200 Maximum Benefit per year
Maternity: Treated Same as any other Medical Condition
Prescription Drug Co-Pay: $15 Generic; $25 Preferred Brand; $50 Non-Preferred Brand
Mail Order Drug Co-Pay: $30 Generic; $50 Preferred Brand; $100 Non-Preferred Brand
Prescription Maximum: $3,000 Annual Combined Reatil & Mail Order  -  No Non-Network Benefits
Vision Discount Benefits: 6,500 Nationwide locations; Discounts on frames, bifocals and contact lenses
Annual Wellness Eye Exam: $15 Co-Pay
Mental Health/Substance Abuse: $5,000 Annual Maximum; $25,000 Lifetime Maximum
Payment Percentage: 80% Network / 50% Non-Network

Plan Benefits: $2,000,000 Lifetime
Individual Deductible: $500 Network / $1,000 Non-Network (Applied separately)
Family Maximum Deductible: $1,500 Network / $3,000 Non-Network (Applied separately)
Payment Percentage: 90% Network / 70% Non-Network to $10,000; 100% thereafter
Doctor Office Co-Pay: $20 per visit   -   Specialist Office Co-Pay: $30 per visit
Wellness Benefit Co-Pay: $20 per visit; $200 Maximum Benefit per year
Maternity: Treated Same as any other Medical Condition
Prescription Drug Co-Pay: $15 Generic; $30 Preferred Brand; $50 Non-Preferred Brand
Mail Order Drug Co-Pay: $30 Generic; $60 Preferred Brand; $100 Non-Preferred Brand
Prescription Maximum: $3,000 Annual Combined Retail & MailOrder   -  No Non-Network Benefits
Vision Discount Benefits: 6,500 Nationwide locations; Discounts on frames, bifocals and contact lenses
Annual Wellness Eye Exam: $15 Co-Pay
Mental Health/Substance Abuse: $5,000 Annual Maximum; $25,000 Lifetime Maximum
Payment Percentage: 80% Network / 50% Non-Network

Plan Benefits: $2,000,000 Lifetime
Individual Deductible: $500 Network / $1,000 Non-Network (Applied separately)
Family Maximum Deductible: $1,500 Network / $3,000 Non-Network (Applied separately)
Payment Percentage: 80% Network / 60% Non-Network to $10,000; 100% thereafter
Doctor Office Co-Pay: $20 per visit   -   Specialist Office Co-Pay: $30 per visit
Wellness Benefit Co-Pay: $20 per visit; $200 Maximum Benefit per year
Maternity: Treated Same as any other Medical Condition
Prescription Drug Co-Pay: $15 Generic; $30 Preferred Brand; $50 Non-Preferred Brand
Mail Order Drug Co-Pay: $30 Generic; $60 Preferred Brand; $100 Non-Preferred Brand
Prescription Maximum: $2,000 Annual Combined Retail & Mail Order  -  No Non-Network Benefits
Vision Discount Benefits: 6,500 Nationwide locations; Discounts on frames, bifocals and contact lenses
Annual Wellness Eye Exam: $15 Co-Pay
Mental Health/Substance Abuse: $5,000 Annual Maximum; $25,000 Lifetime Maximum
Payment Percentage: 80% Network / 50% Non-Network

Plan Benefits: $2,000,000 Lifetime
Individual Deductible: $1,000 Network / $2,000 Non-Network (Applied separately)
Family Maximum Deductible: $3,000 Network / $6,000 Non-Network (Applied separately)
Payment Percentage: 80% Network / 50% Non-Network to $10,000; 100% thereafter
Doctor Office Co-Pay: $20 per visit   -   Specialist Office Co-Pay: $30 per visit
Wellness Benefit Co-Pay: $20 per visit; $200 Maximum Benefit per year
Maternity: Treated Same as any other Medical Condition
Prescription Drug Co-Pay: $15 Generic; $35 Preferred Brand; $50 Non-Preferred Brand
Mail Order Drug Co-Pay: $30 Generic; $70 Preferred Brand; $100 Non-Preferred Brand
Prescription Maximum: $1,500 Annual Combined Retail & Mail Order  -  No Non-Network Benefits
Vision Discount Benefits: 6,500 Nationwide locations; Discounts on frames, bifocals and contact lenses
Annual Wellness Eye Exam: $15 Co-Pay
Mental Health/Substance Abuse: $5,000 Annual Maximum; $25,000 Lifetime Maximum
Payment Percentage: 80% Network / 50% Non-Network

LIMITED BENEFIT PLAN:

Plan Benefits: $50,000 per Calendar Year; $1,000,000 Lifetime
Individual Deductible: $250 Network / $500 Non-Network (Applied separately)
Family Maximum Deductible: $750 Network / $1,500 Non-Network (Applied separately)
Payment Percentage: 80% Network / 60% Non-Network to $10,000; 100% thereafter
Doctor Office Co-Pay: $20 per visit; $100 Maximum Benefit per visit
Specialist Office Co-Pay: $35 per visit; $100 Maximum Benefit per visit
Wellness Benefit Co-Pay: $20 per visit; $200 Maximum Benefit per year
Maternity: Treated Same as any other Medical Condition; $5,000 Annual Maximum Benefit
Prescription Drug Co-Pay: $10 Generic; AWP less 12% Brand (or lower promotional price if available)
Mail Order Drug Co-Pay: $20 Generic; AWP less 16% Brand
Prescription Maximum: $1,500 Annual Combined  -  No Non-Network Benefits
Vision Discount Benefits: 6,500 Nationwide locations; Discounts on frames, bifocals and contact lenses
Annual Wellness Eye Exam: $15 Co-Pay
Organ Transplants: Annual Plan limits apply; $100,000 Lifetime Maximum

These are only a brief description of benefits available and will not be used to determine benefits payable. The exact provisions of the benefit plan can be found in the Plan Document and Summary Plan Description adopted by each Employer.

NATIONAL MEDIA BENEFITS

Rate Stability

Helping the Employer
Maintain Costs

NATIONAL MEDIA BENEFITS health plans are also designed to achieve rate stability. We are committed to managing the program to achieve the best possible results using the following techniques:

* Management of reinsurance rates;
* Preferred Provider Organization Discounts;
* Pharmacy Benefit Management;
* Non-Network fee negotiation;
* Internet communication to minimize client service requests;
* Increase vendor volume discounts by growth; and
* Management of experience through underwriting.

NATIONAL MEDIA BENEFITS health plans offer an employer a unique alternative to funding and customizing their company's health benefits plan.

NATIONAL MEDIA BENEFITS

The Mechanics

The Employer's Solution: NATIONAL MEDIA BENEFITS

NATIONAL MEDIA BENEFITS health plans are Employee Health & Welfare Benefit Plans. Each health plan has been designed by specialists to conform to the legal requirements of ERISA. Each plan provides comprehensive health benefits for the participants and their qualifying dependents.

The employer chooses from the six available benefit plan options: Four Major Medical PPO plans consisting of the Executive, Corporate Plus, Corporate and Secure Care, one Limited Benefit plan - Basic Care I and the Indemnity plan. The total monthly funding is calculated by our underwriters based on the employer group's geographic location, overall health history, plan of benefits selected and the age and number of participants in the plan. When approved, the NATIONAL MEDIA BENEFITS health plan is funded by contributions from the employer and the participating employees to a Single Employer Trust (SET) established for the specific purpose of administering the Plan. NMB, with the assistance of an actuary, has developed a rating program to determine the fully funded contribution rates to cover the total cost of providing benefits. These costs include all of the fees and expenses of administering the Plan and the Trust, fees for the design and marketing of the Plan, enrollment, claims administration, COBRA and HIPAA administration, Preferred Provider Organization (PPO) access fees and the cost of reinsurance. By establishing the Trust in the District of Columbia and appointing Security Benefit Administrators, Inc. as Plan Administrator, Named Fiduciary, and Trustee, the employer is assured of superior and professional administration of the chosen health benefits Plan.

The SET is solely responsible for payment of all benefits. The contributions to the SET are predetermined for each Plan Year based on the participation, the cost of reinsurance and expenses. An Advance Aggregate Reinsurance Stop-Loss insurance policy issued to the SET reimburses each SET under a master policy for all losses in excess of the self-funded attachment point. Any short-term claims experience exceeding a Plan's currently available assets will be met by an advance from the reinsurer. This results in the contribution rates being guaranteed for a Plan Year and assures that the SET has adequate assets to pay all benefits and expenses.

The Trust Document explains and establishes the role of the Custodian who is a national bank. All contributions received by the SET will be deposited into an account with the Custodian.

NATIONAL MEDIA BENEFITS

Employer Requirements

* Employer size: The NATIONAL MEDIA BENEFITS health plans are designed for employers who have a minimum of 5 employees with no maximum size. A husband and wife, by themselves, do not qualify for the minimum size requirement.
* Multiple Plans: The employer can offer two (2) major medical plans and one (1) limited benefit plan to its employees if there is a minimum of 15 enrolled employees. The employer can offer one (1) major medical and one (1) limited benefit plan to its employees if there are between 5 and 14 enrolled employees. The employer must use a defined contribution to offer multiple plan options and to qualify for non-discrimination.
* Contribution Requirements: The employer must pay a minimum of 50% of the employee contribution cost to fund the benefits selected.
* Participation Requirements: The employer must maintain 75 % participation of all eligible employees at all times. Eligibility is defined as an employee who is working full time on the effective date of the NATIONAL MEDIA BENEFITS health plans or who later becomes an employee and is not covered under a health benefit plan elsewhere. Temporary, seasonal and subcontracted employees are not considered to be eligible employees.
* Underwriting Requirements: Full evidence of insurability will be required for all employer groups.
* Workers Compensation or Occupational Accident Requirements: An employer must have coverage in order to qualify for the NATIONAL MEDIA BENEFITS health plans. No "24-hour" coverage is provided.
*5500 series Filing Requirement: The Plan Administrator, SBA, Inc. or its designee, will prepare and file the 5500 series Reporting Form required by the Department of Labor within the 7 month deadline period after the end of the plan year.
* COBRA and HIPAA Compliance: WorkLife Solutions has been contracted to handle all of the responsibilities of COBRA and HIPAA compliance on behalf of the employer.

NATIONAL MEDIA BENEFITS

General Provisions

* All quoted rates are based on the benefits requested for eligible employees and the employer information submitted. Final rates are subject to final enrollment and medical underwriting.
* Benefits applied for will not become effective until the SET is approved by the Plan Administrator.
* There is a credit for partial or full satisfaction of the deductible when the NATIONAL MEDIA BENEFITS plan replaces an existing group medical plan.
* Credit is given toward the annual calendar year deductible for deductible satisfied during the last three months of the prior calendar year.
* Plan Participants or their Participating Dependents who have a Pre-existing Condition will not receive benefits regarding that Preexisting Condition for 12 months (18 months for Late Enrollees, if applicable for the Plan) after the Enrollment Date. Credit will be given for the number of days the employee had prior Creditable Coverage. A Preexisting Condition is a physical or mental condition, regardless of the cause of the condition, for which medical advice, diagnosis, care or treatment was recommended or received within the six month period prior to and ending on the Enrollment Date.

NATIONAL MEDIA BENEFITS

Definitions

Claims Administration.  These services are provided to all plan participants and include processing/payment of health care claims for plan members. The entity providing claims administration services will also have an 800-line available to plan participants and providers. The client service representatives staffing the 800-lines will answer questions/inquires concerning claims status. Sentinel Administrators, Inc., a TPA responsible for claims administration, with over 30 years of experience, has been contracted by SBA, Inc. to provide these services to Plan Participants.

Custodian.  The entity, financial institution or corporation is where the cash funds are deposited each month and which satisfies the requirements of Section 412(b) of ERISA. The Custodian deposits the funds in checking accounts, savings accounts, certificates of deposit, money market funds and similar types of investments earning a reasonable rate of interest as directed by the Trustee.

ERISA and IRS Reports.  ERISA requires various reports to the Department of Labor, the IRS and the plan participants. Those requirements vary depending on the size of the group. SBA, Inc., Plan Administrator, or its designee, subcontracts for the production of the data required for these reports and on behalf of the SET, submits all of the required reports.

Plan Administrator, Named Fiduciary and Trustee.  Each Plan must name a Plan Administrator who has broad powers to administer the plan in the best interests of the participants and there must be a Named Fiduciary. The Trustee may be the Plan Administrator and the Named Fiduciary. Through arrangements with SBA, Inc., these services are provided to the NATIONAL MEDIA BENEFITS health plans SETs.

Plan Document.  Health benefits specialists have crafted a comprehensive document covering the terms and conditions of an Employee Health & Welfare Benefit Plan structured to conform to the requirements of ERISA that is adopted by the employer as its Employee Health & Welfare Benefit Plan.

Reinsurance.  ERISA does not require reinsurance but to assure that the assets of the Trust are adequate to meet all liabilities, reinsurance is a requirement for all NATIONAL MEDIA BENEFITS health plan SETs. SBA, Inc., as named Trustee, purchases the reinsurance and the premium depends on the composition of each Trust. Because SBA, Inc. is named Trustee for all of the SETs and by purchasing specific stop-loss reinsurance direct from an A-rated, domestic reinsurance company, reinsurance is available at an affordable price.

Summary Plan Description.  ERISA requires that each plan participant be provided with a document that describes the Plan in layman terms. While it is called a Plan Document and Summary Plan Description, this is actually a comprehensive document explaining the Employee Health & Welfare Benefit Plan adopted by the employer. SBA, Inc. health benefits specialists have carefully crafted this Document to meet all of the ERISA requirements.

Trust.  ERISA requires that all of the assets of an Employee Health & Welfare Benefit Plan be held in trust by one or more trustees who shall have the exclusive authority and discretion to manage and control the assets of the plan in conformance with the requirements of ERISA. SBA, Inc. has designed a Trust Document that the employer utilizes to establish a Single Employer Trust (SET).

Utilization Review/Medical Management Services.  These services, provided by Sentinel Administrators, Inc., include oversight and management of all inpatient hospital stays and high-cost outpatient procedures/services that might be needed by Plan Participants.