HRA105
HEALTH REIMBURSEMENT ARRANGEMENT
SUMMARY PLAN DESCRIPTION
AS ADOPTED BY
KERR COUNTY
EFFECTIVE OI/OI/LOOS
TABLE 04 C.O`V7'ENTS
PART 1. GENEILIL INFORMATION ABOUT THE HEALTH REIMBURSEMENT PLAN
1.01	What is the purpose of [he Plan? ...............................................................................................	..... 1
1.02	Who can participate in the Plaa? ..............................................................................................	..... 1
1.03	When does coverage under the Plan end? .................................................................................	..... 1
1.04	What happens if I take a leave of absence'.' ..............................................................................	..... 2
1.05	How do 1 pay for coverage under the HR4 [hat I receive during the Year? .............................	..... 2
1.06	What amount of "Eligible Medical Expenses'" may be reimbursed by the Plan each Year'?....	..... 2
1.07	What happens if I do not use the maximum annual Reimbursement Amount made availab]e	during the
	Plan Year? ................................................................................................................................	..... 2
1.08	What is an "Eligible Medical Expense"? ..................................................................................	..... 3
1.09	How do 1 receive Benefits (or reimbursements) under the Plan? ..............................................	.... 3
1.10	How long do I have to submit claims far reimbursament? ........................................................	.... 3
1.1 I	Wha[ happens if my claim for benefits is denied'? .....................................................................	.... 3
L12	Does my coverage under this Plan end when my employment terminates? ..............................	....4
PART 2. COBRA CONTINUATION COVERAGE
2.01	What is "Continuation Coverage" and how does it work? ................................	............................. 5
2.02	When can I continue coverage? ........................................................................	............................. 5
2.03	What type of coverage can be continued? ........................................................	............................. 5
2.04	Do 1 have any other options? ............................................................................	............................. 6
2.05	What should I do if I have a change in my status? ................._........................	............................. 6
2.06	How and when do I elect COBRA continuation coverage'? ..............................	............................. 6
2.07	How much will COBRA continuation coverage cost? .....................................	............................. 6
2.08	How long can I continue the coverage? ............................................................	............................. 6
PART 3. SPEND-DOWN OPTION
3.01	What is [he "Spend-Down" option and does it apply to me? .......................................	.................. 7
3.02	What is [he Spend-Down Coverage Period? ................................................................	.................. 7
3.03	Who are my Eligible Dependents? ..............................................................................	.................. 7
3.04	When do I qualify for the Spend-Down op[ion? ..........................................................	.................. 7
3.05	For what amount may I be reimbursed under the Spend-Down Option? ....................	.................. 7
3A6	Do I have to pay premiums to participate in [he Spend-Down Option? ......................	.................. 7
3.07	What are Eligible Spend-Down Expenses? .................................................................	.................. R
3.08	How is my HRA handled for the Plan 1~ ear iu which I tenninat~.' ..............................	.................. 8
3.09	If I am eligible for the Spend-Down option, how and when do 1 elect it? ...................	..................8
3.10	If I elect COBRA, can I also elect the Spend-Down aprion? .......................................	.................. 8
3. I I	What happens if I am rehired or become eligible again after my Spend-Down coverage begins? 8
PART 4. OTHER IDIPORTANT INFORMATION
4.01	Unclaimed Reimbursement Payments .............................................	.............................................. 8
4.02	Plan Administrator ...........................................................................	.............................................. 8
4.03	Type of Funding ...............................................................................	............................................. 8
4.04	Plan Year ..........................................................................................	............................................. 9
4.05	Identifying Your Employer ...............................................................	............................................. 9
4.06	Official Plan Name and Plan Number ..............................................	............................................. 9
4.07	Agent for Service of Legal Process ..................................................	.............................................9
4.08	Employment .....................................................................................	.............................................9
4.09	Effective Date of the Plan ................................................................	............................................. 9
4.10	Coordination ofBenefits ...................................................................	.............................................9
ERISA Rlcxrs
APP END [X ...............................................................................................................................................................11
KERR COC~N7-I'
Health Reimbursement ?~1Tangement
Summary Plan Description.
Your Employer (the "Employer") has established a plan known as a "Health Reimbursement Arrangement" (the "Plan"), with one or
more underlying health reimbursement accounts ("HRAs") for its Employees to reimburse eligible Employees for Eligible Medical
Expenses incurred by them, their Spouses and eligible Dependents. This Summary Plan Description ("SPD") describes the basic
features of the Plan, how it operates, and how you can get the maximum advantage from it. Attached to this SPD is an Adoption
Agreement that describes information specific to your Plan. The Plan is intended tr+ quality as an Internal Revenue Code Section 105
medical reimbursement arcangement.
Part 1. General Information about the health Reimbursement Plan
1.01 What is the purpose of the Plan?
'fhe purpose of the Plan is to reimburse eligible employees for "Eligible Medical Expenses" [hat they or their Eligible
Dependents incur during the Coverage Period set forth in the 4dnptiou .4grzement.
1.02 Who can participate in the Plan?
You may participate in the Plan if you meet the requirements of an "Eligible Employee" set forth in the Adoption
Agreement. Once you become a participant in the Plan, you enroll in one of the HRAs offered under the Plan. Each HRA
will be categorized as "linked" or "non-linked" in the Adoption Agreement. A `Linked HRA" is paired (or linked) with a
Group Health Plan. You cannot participate in a linked HRA unless you participate in the Group Health Plan. A "non-Linked
HRA" does not require participation in a Group Health Plan.
For Linked HRAs, your emollment period is the same as the <mollment period for the Group Health Plan. You may be
automatically enrolled in a Linked HRA when you participate in the linked Group Health Plan. Your enrollment materials
will state iF you are automatically enrolled or if you need to submit an enrollment form. If you wish to enroll in anon-Linked
HRA (if offered under [he Plan), the enrollment period will be set forth in your enrollment material.
The scope and level of reimbursement of Eligible Medical Expenses under the Plan varies by HRA. Each HRA offered under
the Plan may impose additional eligibility requirements. These additional eligibility requirements will be described in Item 9
of the Adoption Agreement. Your participation in the Plan and the underlying HRA will begin on the date set forth in the
Adoption Agreement.
Once you become a Participant, you may also receive reimbursements for Eligible Medical Expenses incurred by your
"Eligible Dependents". Generally, "Eligible Dependents" means an employee's legal spouse (as defined by state law to the
extent consistent with the federal Defense of Marriage Act) and any other individual who is a tax dependent as defined under
Code Section 152, except that a child of divorced parents is can<idercd a dependent of both parents. Additional requirements
for dependent eligibility may be set forth in the Adoption Agreement fro one ar more of the HRAs offered under the Plan
and such requirements may be more narrow (for instance, if it is a l.iuked HRA. Holy those dependents who meet the general
requirements discussed above and are covered under the Group Health Plan may become covered under the HRA). See Item
9 of the Adoption Agreement for additional information).
If the Plan Administrator receives a qualified medical child support order relating [o the Plan, the Plan will provide [he health
benefit coverage specified in the order to the person or person: ("ahrnuie recipients") named in the order. "Alternate
recipients" include any child of the participant who the Plan is required to aovzr pursuant to a qualified medical child support
order, A "qualified medical child support order" is a legal jud ;ntent, decree or order relating to medical child support that
clearly specifies [he type of coverage that is to be provided to one or more alternate recipients (or the manner in which such
type of coverage is to be provided). Before providing any coverage to an alternate recipient, [he Plan Administrator must
determine whether the medical child support order is qualified, If the Plan Administrator receives a medical child support
order relating to your HRA, it will notify you in writing, and after receiving the order, it will inform you of its determination
of whether or not the order is qualified. Upon request to [he Plan ~ldrninistrunr, you may obtain, without charge, a copy of
the Plan's procedures governing qualified medical child suppon orders.
1.03 When does coverage under the Plan end?
Your Participation in the Plan shall terminate on the eazliest o£
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KERB COl!iYTY HEALTH RELM6URSEME~IT ARRANGEDiENT
(a) the date you cease to be an Employee;
(b) the date you cease to meet the eligibility requirements for an "Eligible Employee" as set forth in the Adoption
Agreement; or
(c) the date this Plan is terminated or amended to exclude you or the class of employees of which you are a member.
You may be able to temporarily continue your coverage under the Plan if you lose coverage for certain reasons. See Part 2
and 3 for more information on continuation coverage.
Coverage for your Eligible Dependents ends on earliest of the following to occur:
(a) the date your coverage ends;
(b) for your spouse, the date [hat you and your spouse divorce or legally separate (or receive an annulment);
(c) the date the individual ceases to meet the requirements of an Eligible Dependent as set forth in the Adoption
Agreement; or
(d) the date the Plan is terminated or amended to exclude the individual or the class of dependents of which the
individual is a member.
Your eligible dependents may also be entitled to temporarily continue coverage if coverage is lost for certain reasons. See
Part 2 and 3 below for more information on continuation coverage.
In addition, your coverage under an HRA will end on the earlier of the date your participation in the Plan ceases or the date
you cease to satisfy the eligibility requirements of the HRA.
1.04 What happens if I take a leave of absence?
If you are in a Linked HRA (as set forth in the Adoption Agreement), then your coverage under the HRA during a leave of
absence is treated the same as it is under the Group Health Plan to which the HRA is linked, to the extent such treatment is
consistent with the employer's applicable leave policies and applicable federal and/or state law.
If you are in anon-Linked HRA {as set Forth in the Adoption Agreement), then your coverage under the HRA ceases if the
leave is unpaid (except as provided below for Family and Medical Leave Act of 1993 (FMLA) and certain military leaves)
and continues during a paid leave. If you are in anon-Linked HRA and you take an unpaid leave that qualifies for protection
under the FMLA, then your coverage will continue during the leave to the extent required under FMLA. If you take a
military leave expected [o last less than 31 days, then your coverage under the HRA continues on the same basis as before
[he leave. If the military leave is expected to last 31 days or longer, your coverage under the HRA ends; however, you may
be entitled to continuation coverage. See COBRA Continuation of Coverage section (Part 2) and Spend-Down Option (Pan
3) below.
1.05 Iiow do I pay for coverage under the LIRA that I receive during the Year?
You do not have [o pay for your HRA coverage; HRA coverage is paid for solely by the Employer. However, if you lose
coverage under the HRA and you are eligible to elect COBRA continuation coverage described in Part 2 below, you will
have to pay the applicable premium for the continued coverage. See Part 2 below for more information on COBRA
continuation coverage.
1.06 What amount of "Eligible Medical Expenses" may be reimbursed by the Plan each Year?
Each year you will be eligible to receive reimbursements equal to the maximum Annual Reimbursement Amount The
maximum Annual Reimbursement Amount that you may receive as reimbursement for Eligible Medical Expenses equals the
sum of the employer's annual contribution ("Annual Employer Contribution") amount and the Carry Over amount, subject to
any limitations and/or Cap set forth in the Adoption Agreement. The Annual Employer Contribution may be made
periodically and the most that you can receive in reimbursement at one time will be your HRA balance at that time (subject
to overall Cap), which is the sum of your accumulated employer contributions and the Carry Over amount. See Item 9 of
your Adoption Agreement for more information.
1.07 What happens if I do not use the maximum Annual Reimbursement Amount made available during the
Plan Year?
All or a portion of the annual contribution amount that you do not use for expenses incurred during the Coverage Period and
submitted for reimbursement during the Plan Year before the end of the closing period may be carried over subject to
limitations set forth in the Adoption Agreement for reimbursement of Eligible Medical Expenses incurred during subsequent
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HEALTH AF.IbIaURSENENT ARRAHGEbIE~T
years. You forfeit the remainder of your annual contribution amount that you are not permitted to cam over. Any unused
amounts that are eligible to be carried over into a subsequent year and used for reimbursement of Eligible Medical Expenses
are called "Carry Over Amounts: '
A non-interest bearing Carry Over account will be set up to keep a record of the unused amounts that you are able to carry
over each year pursuant to the terms of the Adoption Agreement, No actual account is established; it is merely a bookkeeping
account and it is considered part of your overall HRA balance. Annual contribution amounts are used first to pay approved
expenses and then Carry Over amounts are used to the extent necessary. Unused Carry Over amounts are carried over for
reimbursement of Eligible Medical Expenses incurred during subsequent Plan Years.
1.08 What is an "Eligible Medical Expense"?
"Eligible Medical Expenses" are expenses incurred by you or your Eligible Dependents that satisfy the following conditions:
a) the expenses are medical care expenses that would otherwise qualify for a deduction under Code § 213 (irrespective of the
income threshold set forth in Code ~ 213); b) the expenses have not been or will not be reimbursed by any other source; c)
the expenses must have been incurred during the Coverage Period set forth in the Adoption Agreement; and d) the expenses
satisfy any additional conditions and/or limitations for an Eligible Medical Expense set forth in [he Adoption Agreement.
Coverage of Eligible Medical Expenses may vary under each HRA option. The following expenses are not eligible for
reimbursement under the Plan under any circumstance: i) Qualified Long Term Care Services and ii) health insurance
premiums (including COBRA premiums) other than premiums for individual insurance policies that do not require health
underwriting. For purposes of this Plan, an expense is "incurred" when the Participant or beneficiary is furnished the medical
care or services giving rise to the claimed expense.
In addition, you may not be reimbursed for any expenses azising before the Plan became effective, before you became a
participant in the Plan, or for any expenses incurred after your participation in the Plan terminates except to the extent
provided in Part 2 and Part 3 below.
1.09 How do I receive Benefits (or reimbursements) under the Plan?
You will receive reimbursement forms to submit to the Plan Administrator (or Plan Service Provider designated by
Employer). You must complete the reimbursement form and submit it with the necessary documentation described in the
Adoption Agreement.
The Plan Administrator (or Plan Service Provider) will review the claim and supporting documentation and determine the
amount, if any, that is payable under the HRA (See 1.11 below for your rights if a claim is denied). Your Plan Administrator
will advise you how often the payments are processed. If your claim for Eligible Medical Expenses is less than the Minimum
Reimbursement Amount set forth in the Adoption Agreement, reimbursement for such expenses will be suspended until your
approved expenses exceed the Minimum Reimbursement Amount. In addition, if your reimbursement is limited to your HRA
balance at that time, then the amount of Eligible Medical Expenses that exceeds your HRA balance will be suspended until
such time as the iota] outstanding Eligible Medical Expenses submitted for reimbursement is equal to or less than the HRA
balance.
You will not be reimbursed for Eligible Medical Expenses if the reimbursement exceeds the Annual Reimbursement Amount
(or the Cap) set in the Adoption Agreement. The Adoption Agreement will state how the excess amount that is not
reimbursed will be handled.
1.10 How long do I have to submit claims for reimbursement?
If you are currently a participant (active Employee or COBRA participant), you must submit an expense incurred during a
Coverage Period no later than the end of the Closing Period set forth in the Adoption Agreement following the end of that
Coverage Period. If you are no longer a participant, you have until the end of the Claims Submission Grace Period set forth
in the Adoption Agreement to submit claims for reimbursement. If a Claims Submission Grace Period has not been
established in the Adoption Agreement, then you have until the end of the Closing Period [o submit claims.
1.11 What happens if my claim for benefits is denied?
If you are denied a benefit under the Plan, you should proceed in accordance with the following claims review procedures.
Step I: Notice is received from the Plan Service Provider. If your claim is denied, you will receive written notice from the
Plan Service Provider that your claim is denied as soon as reasonably possible but no later than 30 days after receipt of the
claim. For reasons beyond the control of the Plan Service Provider, the Plan Service Provider may take up to an additional 15
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HEALTH REL\IBURSEMENT ARRANGEMENT
days [o review your claim. You will be provided written notice of the need for additional time before the end of the 30-day
period. If the reason for the additional time is that you need to provide additional information, you will have 45 days from
the notice of the extension to obtain that information. The time period during which the Plan Service Provider must make a
decision will be suspended until the earlier of the date that you provide the information or the end of the 45-day period.
Step 2: Review your notice carefully. Once you have received your notice from the Plan Service Provider, review it
carefully. The notice will contain:
• [he reason(s) for the denial and the Plan provisions on which the denial is based;
• a description of any additional information necessary for you to perfect your claim and, why [he information is
necessary;
a description of the Plan's appeal procedures and the time limits applicable to such procedures;
whether an internal rule or guideline was relied on in making the determination and a statement that you may
request a copy of the guidelines or protocol; and
• a statement reminding you of your right to request all documentation relevant to your claim;
Step 3: Ijyou disagree with the decision, you mavfle an Appeal, if you do not agree with [he decision of the Plan Service
Provider, you may file a written appeal. You should file your appeal no later than 180 days of receipt of the notice described
in Step 1. if the Plan has established only one level of appeal, you should file your appeal with the Plan Administrator. If the
Plan has established two levels of appeal, you should file your appeal with the Plan Service Provider. The notice of denial
referenced in Step 1 above will indicate whether the plan has I or 2 levels of appeal and where you should file your appeal.
Regardless, you should submit all information identified in the notice of denial as necessary to perfect your claim and any
additional information that you believe would support your claim.
Step 4: Notice ojDeniu/ is received from claims reviewer. If the claim is again denied, you will be notified in writing. If the
plan has established two levels of appeal as set forth in the notice of denial, the notice will be sent no later than 30 days after
receipt of the appeal by the Plan Service Provider. Otherwise, notice of the denial will be sent no later than 60 days after the
appeal is received by the Plan Administrator.
Step 5: Review your notice carefully. You should take the same action that you take in Step 2 described above. The notice
will contain the same type of information that is provided in the first notice of denial provided by the Plan Service Provider.
Step 6 (if there is a second level of appeal as indicated in the notice of denial): If you still disagree with the Plan Service
Provider's decision, ale a Ind Level Appeal with the Plan Administrator. If you still do nat agree with the Plan Service
Provider's decision, you may file a written appeal with [he Plan Administrator within the allotted number of days set forth in
the denial notice after receiving the first level appeal denial notice from the Plan Service Provider. You should gather any
additional information that is identified in the notice as necessary to perfect your claim and any other information that you
believe would support your claim.
If the Plan Administrator denies your 2"d Level Appeal, you will receive notice within 30 days after the Plan Administrator
receives your claim. The notice will contain the same type of information that was referenced in Step 2 above.
Other important information regarding your appeals:
• Each level of appeal will be independent from the previous level (i.e. the same person(s) or subordinates of the same
person(s) involved in a prior level of appeal will no[ be involved in the appeal);
• On each level of appeal, the claims reviewer will review relevant information that you submit even if it is new
information;
• You cannot file suit in Federal court until you have exhausted these appeals procedures.
1.12 Does my coverage under this Plan end when my employment terminates?
Yes. Your normal participation will cease at the end of the day that your employment with the Employer terminates.
Elowever, you and your covered family members may have the opportunity to continue to be covered under the Plan
pursuant to the Continuation Coverage provisions described in Part 2 below.
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KERB COE~"rY
HF,AI,TII IiElnlanRSEVfEVT ARttn~GEMEN'r
In addition to COBRA continuation coverage, your Employer may elect to have aSpend-Down option fox you to use your
HRA amounts (or a portion thereof) for Eligible Expenses after your employment ends. The Spend-Down option is explained
in Par[ 3 below, and the Adoption Agreement will indicate whether or not the Spend-Down option is offered.
Part 2. COBRA Continuation Coverage
2.01 What is "Continuation Coverage" and how does it work?
Federal law requires most employers sponsoring group health plans to offer employees and their families the opportunity for
a temporary extension of health care coverage (called "continuation coverage") in certain instances where coverage under the
Plan would otherwise end. These rules apply to the Plan unless the Employer is a "small employer" as defined under
applicable law. The Plan Administrator can tell you whether your Plan is subject to these rules.
2.02 When can X continue coverage?
If you are a participant in the Plan, then you have a right to choose continuation coverage under the Plan if you lose your
coverage because of:
• Reduction in your hours of employment,
Voluntary or involuntary termination of your employment (for reasons other than gross misconduct), or
• You take a military leave of absence that lasts 31 days or longer (in accordance with USERRA).
If you are the covered Spouse of a participant, then you have the right to choose continuation coverage for yourself if you
lose coverage under the Plan for any of the following reasons:
• Death of your Spouse,
• Voluntary or involuntary termination of your Spouse's employment (for reasons other than gross misconduct) or
reduction in your Spouse's hours of employment,
• Divorce or legal separation from your Spouse,
• Your spouse goes on military leave of absence that lasts 31 days or longer (in accordance with USERRA), or
Your Spouse becomes entitled to Medicare.
In the case of a covered Dependent child, the Dependent child has the right to choose continuation coverage if coverage
under the Plan is lost for any of the following reasons:
• Death of the employee,
• Voluntary or involuntary termination of the employee's employment (for reasons other than gross misconduct) or
reduction in the employee's hours of employment,
• Divorce or legal separation of child's parents,
• Employee becomes entitled to Medicare (only in limited situations as described below),
• Employee goes on military leave of absence [ha[ lasts 31 days or longer (as required under U5ERRA), or
• Child ceases [o be an eligible Dependent child.
A child who is born to, or placed for adoption with, the employee during a period of continuation coverage is also entitled to
continuation coverage. Each person who is entitled to continuation coverage is called a "Qualified Beneficiary."
2.03 What type of coverage can be continued?
If you choose continuation coverage, you are entitled to the level of coverage in effect under your HRA immediately
preceding the qualifying event. If coverage is modified for similarly situated active employees, then it will be modified for
you. You will be eligible to make a change in your coverage upon the occurrence of any event that permits a similarly
situated active employee to make a benefit change during a Plan Year. Each year that COBRA continuation coverage is in
effect, you are entitled to the same amount of Annual Employer Contribution provided to similarly situated active employees
plus any applicable Carry Over amounts from the previous year.
If you do not choose continuation coverage, your participation in the Plan will end on the date coverage ends in accordance
with the qualifying event.
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2.O~i Do I have any other options?
HEALTH REIMHtIRSE~IF,NT ARRANCEMF.NT
If offered by your Employer, you may wish to °lcct the Spend-Down Option described in Part 3 as apposed to COBRA
continuation coverage. However, if you elect ne Spend-Down option, you waive your right to COBRA continuation
coverage. You may, however, revoke that waiver prior to end of the original 60-day COBRA election period.
2.05 What should I do if I have a change in my status?
You (or your covered spouse and'or dependent children) must notify the Plan Administrator of a divorce, legal separation, or
a child losing Dependent status under the Plan within 60 days of the later of the date of the event or the date on which
coverage is lost because of the event. When thf Plan Administrator is notified [hat one of these events has occurred, the Plan
Administrator will in turn notify the affected Qualified Beneficiary that he or she has a right [o choose continuation coverage.
Notice to an employee's Spouse is treated as n. Mice to any covered Dependents who reside with the Spouse.
An employee, covered spouse, or covered L-ependent child is responsible for notifying the Plan Administrator if he or she
becomes covered under another group healtt plan or Medicare.
2.06 How aad when do I elect COBRA continuation coverage?
You, your covered Spouse, and covered Irependent child(ren) are each entitled to make a separate election for continuation
coverage under the Plan. IF this is a Linked HRA as identified in the Adoption Agreement, you must elect to continue
coverage under the Group Health Plan t~~ which the HRA is linked in order to continue coverage under the HRA. If you are
in anon-Linked HRA, you may elect tae HRA and/or any other group health plans sponsored by your employer in which
you participate, to the extent subject to COBRA. In order to elect continuation coverage, you must complete the election
form(s) provided to you by the Plan Adtinistrator. You have 60 days from the date you would lose coverage for one of the
reasons described above or the date you are sent notice of your right to elect continuation coverage, whichever is later, to
inform the Plan Administrator that you wish to continue coverage. Failure to return the election form within the 60-day
period will be considered a waiver, and you will not be allowed to elect COBRA continuation coverage.
2.07 How much will COBRA continuation coverage cost?
You will have to pay the entire cost of your continuation coverage. The cost of your continuation coverage will not exceed
102% of the "applicable prc m" for the period of continuation coverage. However, if you extend coverage due to a
disability (see Z.OS below), you may have to pay 150% of the applicable premium. The first premium payment after electing
continuation coverage will be duc 45 days after making your election. Subsequent premiums must be paid within a 30-day
grace period following the due date. Failure to pay premiums within this time period will result in automatic termination of
your continuation coverage. If you pay a premium that is insufficient by an insignificant amount (the lesser of $SO or 10% of
the premium), you will be given additional time to pay the remainder of the premium. Claims incurred during any period will
not be paid until your premium payment is received for that period. If you timely elect continuation coverage and pay the
applicable premium, continuation coverage will relate back to the first day on which you would have lost regular coverage.
2.08 How long can I continue the coverage?
The maximum period that you may continue coverage depends on the type of Qualifying Event that has caused you to lose
coverage. If your spouse and/or dependent child lose coverage as a result of a qualifying event other than your termination of
employment or reduction in hours of employment, your spouse and dependent child may elect COBRA continuation
coverage for 36 months beginning on the date of the Qualifying Event. If you, your spouse, and your dependent children lose
coverage as a result of your termination of employment or reduction in hours of employment (including a military leave of
absence [hat is expected [o last 31 days or longer), COBRA continuation coverage will continue for 18 months beginning on
the date of your qualifying event. If either you, your spouse, or your dependent child was disabled (as determined by the
Social Security Administration under Title II or Title XVI of the Social Security Act) at the time of or within 60 days of the
Qualifying Event, then the 18-month continuation coverage period For each covered family member may be extended by 11
months [0 29 months. To preserve your right to additional coverage by reason of disability, you must inform [he Plan
Administrator of the determination of disability within 60 days of the date i[ was made, and within the 18-month period after
the Qualifying Event that caused you to lose coverage. Additional Qualifying Events may occur while the 18-month (or 29
month) continuation coverage period is in effect that will allow your covered spouse andlor dependent children to continue
coverage for 36 months from the original Qualifying Event. These include your divorce or legal separation from your
spouse, your death, your becoming entitled [o IVtedicare, or your dependent child ceasing to be a dependent child. In
addition, if you become entitled to Medicare and then you lose coverage as a result of a termination of employment or
reduction in hours of employment within 18 months of becoming entitled to Medicare, your spouse and dependent children
are entitled to 36 months of continuation coverage beginning on the date that you became entitled to Medicare. However,
continuation coverage may end eazlier in the following circumstances:
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• the last day of the month for which the Last premium for your continuation coverage was timely paid;
• the date, after you elect continuation coverage, that you first become covered under another group health plan under
which you are not subject to apre-existing condition exclusion or limitation (this does not apply to [hose continuing
coverage as a result of a military leave of absence};
• the date, after you elect continuation coverage, that you fast become entitled to Medicare ([his does not apply to
those continuing coverage as a result of a military leave of absence); or
• the date employer no longer provides group health coverage to any of its employees
For those taking an applicable military leave, the continuation coverage will end on the date that you do not rerum [o work in
accordance with the rules and regulations under USERRA (if required to return to work prior to the end of the 18 month
period).
Part 3. Spend-Down Option
3.01 What is the "Spend-Down" option and does it apply to me?
The Spend-Down option is not offered by all Employers. See the attached Adoption Agreement to see whether the Spend-
Down Option is offered by your Employer.
The Spend-Dawn Option is designed to give you an alternative to COBRA continuation coverage. After you experience one
of the Qualifying Spend-Down Events (set Forth in the Adoption Agreement), all or a portion of your HRA balance no[ used
for expenses incurred prior [o the date coverage is lost as a result of a Qualifying Spend-Down Even[ may be used for
Eligible Spend-Down Expenses incurred during the Spend-Down Period by you and your Eligible Dependents (as defined
for purposes of the Spend-Down Period) (see 3.03 below).
3.02 What is the Spend-Down Coverage Period?
The Spend-Down Coverage Period begins on the date that you lose coverage under the Plan as the result of a Qualifying
Spend-Down Event and ends on the date set forth in the Adoption Agreement. You can be reimbursed for Eligible Spend-
Down Expenses incurred during the Spend-Down Period until your Spend-Down Amounts are exhausted or the Spend-Down
Period ends. Any Spend-Down Amounts not used for expenses incurred during the Spend-Down Period will be forfeited
except as set forth in 3.11 below.
3.03 Who are my Eligible Dependents?
For the purpose of the Spend-Down option, your Eligible Dependents include (a} legal spouse, (b) any [ax dependent defined
under Code Section 152 (except that a child of divorced parents is considered a dependent of both parents), and (c) any child
for whom you are required to provide health coverage pursuant to a Qualified Medical Child Support Order.
3.04 When do I qualify for the Spend-Down option?
You may became eligible for the Spend-Down Option if you experience a "Qualifying Spend-Down Event." If your
employer offers the Spend-Down option, the specific Qualifying Spend-Down Events that entitle you to the Spend-Down
Option will be listed in the attached Adoption Agreement.
3.05 For what amount may I be reimbursed under the Spend-Down Option?
The maximum amount of your HRA balance that may be used during the Spend-Down Period will be stated in the Adoption
Agreement. The Spend-Down Option only allows you to use all or a portion of your HRA balance as of the date you lose
coverage as a result of a Qualifying Spend-Down Event. Unlike COBRA, you will not be eligible for any future employer
contributions under the Spend-Down Option.
3.06 Do I have to pay premiums to participate in the Spend-Down Option?
You will not have to pay any premiums to participate in the Spend-Down Option; however, the Employer may charge a
nominal amount for administration of the Spend-Down option.
3.07 What are Eligible Spend-Down Expenses?
Unless otherwise stated in the Adoption Agreement, Eligible Spend-Down Expenses under the Spend-Down option will be
any medical care expenses incurred by you or your Eligible dependents during a Coverage Period that would otherwise
qualify for a deduction under Code § 213 (irrespective of the income limitations set forth in Code q 213) and have not been
or will not be reimbursed by any other source. Notwithstanding the preceding sentence, health insurance premiums
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(including COBRA premiums) other than those for individual health insurance policies that do not require medical
underwriting, and qualified long term care services are ineligible for reimbursement. For purposes of this Plan, an expense is
"incurred" when the Participant or beneficiary is furnished the medical care or services giving rise to the claimed expense.
3.08 How is my HRA handled for the Plan Year in which I terminate?
]f you elect the Spend-Down option, the Employer contributions to your HRA will cease as of the date your coverage ceases
as a result of [he Qualifying Spend-Down Even[. You will continue submitting claims (in [he same manner as before) for
Eligible Medical Expenses incurred before the date that coverage would otherwise end as a result of the Qualifying Spend-
Down Event until the end of the Claims Submission Grace Period. Once the Claims Submission Grace Period is over, you
may use the unused HRA amounts for reimbursement of Eligible Spend-Down Expenses in accordance with the Spend-
Down roles set forth in the Adoption Agreement.
If Eligible Medical Expenses incurred before the termination date are not reimbursed as a result of the Cap limitations on
HRA amounts (as set forth in the Adoption Agreement), the unreimbursed Eligible Medical Expenses can be paid out of the
Spend-Down funds.
3.09 If I am eligible for the Spend-Down option, how and when do I elect it?
Election is made by completing the election form given you. You have the same period of time to elect the Spend-Down
option as you do to elect COBRA. While you can submit the election form any time during that period, the Spend-Down
option will not become effective until the COBRA election period expires. When your election becomes effective, you can
submit claims for Eligible Spend-Down Expenses incurred during the Spend-Down Period to the extent eligible. (See 3.02
above).
3.10 If I elect COBRA, can I also elect the Spend-Down option?
No. If you elect COBRA, you are not eligible to elect the Spend-Down option.
3.11 What happens if I am rehired or become eligible again after my Spend-Down coverage begins?
If you are rehired or otherwise become eligible again after your Spend-Down coverage begins, you will be able to participate
in an HRA as an active employee as if you were a new employee.
Your remaining Spend-Down amount (or a portion thereof) may be applied toward your new HRA balance according to the
provisions set forth in the Adoption Agreement.
Part 4.Other Important Information
4.01 Unclaimed Reimbursement Payments
Any reimbursement benefit payments that are unclaimed (e.g., uncashed benefit checks) by [he close of the Plan Year
following [}re Plan Year in which the eligible expenses were incurred shall be forfeited.
4.02 Plan Administrator
The Plan Adtninistrator's name, address and telephone number appear in [he Adoption Agreement to this Summary. The Plan
Administrator shall have the exclusive right to interpret the Plan and to decide all matters arising under the Plan, including
the right to make determinations of fact, and construe and interpret the terms of the Plan, including possible ambiguities,
inconsistencies, or omissions in the Plan and the Summary Plan Description issued in connection with the Plan. The Plan
Administrator may designate certain claims processing (including the initial determination as to whether a claim is payable)
and day-to-day administrative responsibilities to a Plan Service Provider identified in the Adoption Agreement. Nevertheless,
the Plan Administrator reserves final discretionary authority for all matters arising under the Plan.
4.03 Type of Tunding
'the Plan is funded solely by your Employer (except during a period of COBRA continuation coverage described above).
Benefits are paid as set forth in the Adoption Agreement.
However, your Employer may establish one or more trusts (e.g. a voluntary employee beneficiary association (VEBA) trust)
to fund benefits provided under this Plan.
4.04 Plan Year
The date of the end of the year for purposes of maintaining the fiscal records of each of the plans is set forth in the Adoption
Agreement to this Summary.
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HEALTH REIM1IBCRSEb1ENT ARRANCEbiE~T
4.05 Identifying Your Employer
The official name, business address, telephone number, and employer identification number (EIN) of the Plan sponsor appear
in the Adoption Agreement to this Summary. The names of any other employers who have adopted the Plan are set forth in
the Adoption Agreement.
4.06 Official Plan Name and Plan Number
The official name of the Plan, and the number assigned to it for identification purposes, appear in the Adoption Agreement
attached to this Summary.
4.07 Agent for Service of Legal Process
Legal process may be served on the Plan Administrator.
4.OS Employment
Participation in the Plan does not give any participant the right to be retained in the employ of his or her employer or any
other right not specified in those plans.
4.09 Effective Date of the Plan
The effective date of the Plan is set forth in the Adoption Agreement.
4.]0 Coordination of Benefits
Only medical care expenses that have not been or will not fie reimbursed by any other source may be Eligible Medical
Expenses (to the extent all other conditions for Eligible Medical Expenses have been satisfied). However, the Adoption
Agreement may require that expenses that are otherwise covered under this Plan and under an employee funded Health FSA
maintained by the Employer must be paid first by the Health FSA to the extent of any available funds in the Health FSA.
ERISA Rights
As a participant in the Plan, you are entitled to certain rights and protections under the Employee Retirement Income Security Act of
1974 (ERISA). ERISA provides [hat all plan participants shall be entitled to;
Receive Information about Your Plan and Benefits
You are entitled to:
• Examine, without charge, at the Plan Administrator's office and at other specified locations, such as work-sites and union
halls, all documents governing the plan, including insurance contracts, collective bargaining agreements and, if applicable, a
copy of the Latest annual report (Form 5500 series) Filed by the plan with the U.S. Deparhnent of Labor and available at the
Public Disclosure Room of the Pension and Welfare Benefit Administration.
• Obtain, upon written request to the Plan Administrator, copies of all documents governing the operation of the plan,
including insurance contracts and collective bargaining agreements, and, if applicable, copies of the latest annual report
(Form 5500 series) and updated summary plan description. The Plan Administrator may make a reasonable charge for the
copies.
• Receive a summary of the Plan s annual financial report (if applicable). The Plan Administrator is required by law to furnish
each participant with a copy of this summary annual report.
Continue Group Health Plan Coverage
You can continue health coverage for yourself, Spouse, or Dependents if there is a loss of coverage under the plan because of a
qualifying event. You or your Dependents may have to pay for such coverage. Review this summary plan description and the
documents governing the plan on the rules governing your COBRA continuation coverage rights.
(This section applies only if the Plan is subject to H[PAA) Exclusionary periods of coverage for preexisting conditions under your
group health plan may be reduced or eliminated if you have creditable coverage under another plan. You should be provided a
certificate of creditable coverage, free of charge, from your group health plan or health insurance issuer when you lose coverage
under [he plan, when you become entitled to elect COBRA continuation coverage, when your COBRA continuation coverage ceases,
if you request it before losing coverage, or if you request it up to 24 months after losing coverage. Without evidence of creditable
coverage, you may be subject [o a preexisting condition exclusion for 12 months (18 months for late enrollees) after your enrollment
date in your coverage.
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Prudent Actions by Plan Fiduciaries
HE,\LTH RELNBCRSEMEKT ARRANGEMEtlT
In addition to creating rights for plan participants, ERISA imposes duties upon the people who are responsible for the operation of the
employee benefit plan. The people who operate your plan, called "fiduciaries" of the plan, have a duty to do so prudently and in [he
interest of the plan participants and beneficiaries. No one, including your employer, your union, or any other person, may fire you or
otherwise discriminate against you in any way to prevent you From obtaining a benefit from the Plan, or from exercising your rights
under ERISA.
Enforce Your Rights
If your claim For a benefit under the Plan is denied in whole or in part, you must receive a written explanation of [he reason for [he
denial. You have the right to have the Plan review and reconsider your claim. Under ERISA, there are steps you can take to enforce
the above rights. For instance, if you request materials tiom the Plan and do not receive them within 30 days, you may file suit in a
federa( court. In such a case, the court may require the Plan Administrator to provide the materials and pay you up to $110 a day until
you receive the materials, unless the materials were not sent because of reasons beyond the control of the Plan Administrator. If you
have a claim for benefits that is denied or ignored in whole or in part, you may file suit in a state or federal court. In addition, if you
disagree with the Plan's decision or lack thereof concerning the qualified status of a domestic relations order or a medical child
support order, you may file suit in federal court. If i[ should happen that plan fiduciaries misuse the Plan's money, or if you are
discriminated against for asserting your rights, you may seek assistance from the U.S. Department of Labor, or you may fife suit in a
federal court. The court will decide who should pay court costs and legal fees. If you are successful, the court may order the person
you have sued to pay these costs and fees. If you lose, the court may order you to pay these costs and fees, for example, if it finds
your claim is frivolous.
What tD do if 1 have questions about the Plan?
If you have any questions about the Plan, you should contact the Plan Administrator. If you have any questions about this statement or
about your rights under ERISA, or if you need assistance obtaining documents from the Plan Administrator, you should contact the
nearest office of the U.S. Department of Labor, Pension and Welfare Benefits Administration listed in your telephone directory, or the
Division of Technical Assistance and Inquiries, Pension and Welfare Benefits Adminisuation, U.S. Department of Labor, 200
Constitution Ave., N.W., Washington, D.C., 20210. You may also obtain certain publications about your rights and responsibilities
under ERISA by calling the publications hotline of the Pension and Welfare Benefits Administration.
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APPENDIX
Attachment 1: Adoption Agreement
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