Read GLM-01201.pdf text version

generally exempt from taxation. As the following chart shows, under a properly administered plan this can amount to a significant savings to your insured executives:

SelfInsured Plan Recipient's Tax Bracket 39.6% 36.0% Total Reimbursements $5,000 $5,000 Federal Tax Paid By Recipient $1,980 $1,800 Exec-U-Care Federal Tax Paid By Recipient NONE NONE

company might not be able to assume such a large financial burden on its own. But through Exec-UCare, you can guarantee the maximum benefit to your employees. Also, benefits from Exec-U-Care are personalized benefits -- tailored to each employee's needs. If the need is less, you'll pay less. In cases where the need is larger, you'll pay more, but only up to the maximum (see "How Much Will Exec-UCare Cost?") Because of the transfer of risk, your employees may get more than you pay for. But you'll never pay for more than they need. Just as important, Exec-U-Care billing and claims administration is handled efficiently and confidentially. That saves your company time and money. In addition, by delivering personalized reimbursement checks that you may deliver directly to your covered employees, Exec-U-Care is a highly visible fringe benefit and an immediate, tangible reward. Every check serves as a reminder of your goodwill and helps reinforce employee loyalty. How Do We File Claims? Use our simple claim form located at www.exec-u-care.com. As an experienced claims administrator, we handle all claims professionally and confidentially. Reimbursement checks will be made out directly to employees. How Much Will Exec-U-Care Cost? The minimum annual premium is $250 per insured employee, plus 111% of the group's total eligible medical reimbursement claims. However, because Exec-U-Care is an insured plan, there is a maximum cost. That maximum is calculated by multiplying the appropriate premium factor (see chart) by the number of employees insured (or three, if greater). For example, using the following table, if you insure five employees under the $50,000 plan, your annual cost for the group cannot exceed $36,000 ($7,200 x 5). But your insured employees are guaranteed annual medical coverage of up to $50,000 each (subject to a $5,000 per occurrence limit).

ANNUAL PREMIUM FACTORS FOR EXEC-U-CARE

Maximum Annual Maximum Annual Number of Premium per Premium per Insured Insured Employee for Insured Employee for Employees $50,000 Plan $100,000 Plan 1-2 3-4 5-7 8-10 11-15 16-20 21-25 26-49 50-74 75-99 100-149 150+ NA $7,625 7,200 6,750 6,575 6,250 6,125 5,750 5,500 5,125 4,700 3,875 $11,500 11,250 10,250 9,325 8,750 8,200 7,875 7,500 6,875 6,250 5,625 5,000

This brochure contains only a brief description of the Exec-U-Care supplemental health care reimbursement insurance plan. It is not a contract. Exact coverages and limitations are governed by the Master Insurance Policy, and this brochure does not modify those coverages or provisions in any way. Exec-U-Care supplemental health care reimbursement insurance is underwritten by Lincoln National Life Insurance Company, a Lincoln Financial Group company. TravelConnectSM services through MEDEX Assistance Corporation and the Gold Prescription Drug Discount Card are provided through separate, independent contractors; these services are not a part of the Exec-UCare Medical Reimbursement Insurance contract. KPMG has issued a tax opinion letter on Exec-U-Care coverage that is available upon request. We cannot advise you concerning the effect of current laws on your particular circumstances. The information in this brochure is general in nature and may not apply to each individual situation. Consult your legal and tax advisors to determine the federal and state income tax ramifications of Exec-UCare coverage for your employees and their families. State-specific restrictions, requirements and approvals are not addressed in this brochure. Each insured employee will be issued a Certificate of Insurance that outlines the benefits provided. Exec-U-Care supplemental medical reimbursement insurance is not available in all states. For more information, please contact the Exec-U-Care administration offices at (800) 552-1213. Exec-U-Care supplemental health care reimbursement insurance is underwritten by Lincoln National Life Insurance Company, a Lincoln Financial Group company. Lincoln Financial Group is the marketing name for Lincoln National Corporation and its affiliates. ©2007 Lincoln National Corporation. Lincoln Financial Group 8801 Indian Hills Drive Omaha, NE 68114 www.LFG.com

Can't We Just Deduct Medical Expenses On Our Personal Income Tax Returns? Current tax code makes it difficult for individuals to take a personal deduction for medical expenses. They can only deduct out-of-pocket medical expenses that are in excess of 7.5% of income, which means that an individual making $100,000 must pay the first $7,500 of medical expenses out of his or her own pocket -- with no opportunity for tax relief. Can My Company Deduct Exec-U-Care Premiums The Same Way We Deduct Other Health Plan Premiums? For most for-profit business entities, premium contributions may qualify for a tax deduction as a reasonable and ordinary cost of doing business. It may actually cost you less to provide key employees with the valuable benefits offered by Exec-U-Care. It is also appropriate for employees of 501(c)(3) organizations. As with any tax matter, you should discuss this with your personal tax advisor. What Are The Other Advantages Of An Insured Medical Reimbursement Plan? Using Exec-U-Care as the funding vehicle for your medical reimbursement plan offers you and your employees several significant advantages. Perhaps the greatest is that in most situations benefits are not taxable to recipients. In addition, Exec-U-Care can guarantee an annual benefit of up to $100,000 per employee. This is possible because there is a transfer of risk to the insurance company (see Annual Premium Factor chart). In case of catastrophic illness or injury, your

If the maximum premium is exceeded, appropriate reimbursements are made after a claims audit has been completed. How Do We Get Started? It's easy to enroll in Exec-U-Care! Just talk to your broker or your Lincoln Financial Group representative.

Exec-U-Care

®

Supplemental Health Care Reimbursement Insurance

P. O. Box 4540 Iowa city, Iowa 52244 customer Services: (800) 552-1213 Fax: (319) 354-5204 Sales & Marketing: (800) 365-3932 www.exec-u-care.com

ExEc-U-carE®

security

GLM-01201 Rev. 6/07

executive

For Your Executives Who Deserve More

TAkE A CorPorATE TAx DEDUCTIoN

For most for-profit business entities, premium contributions may qualify for a tax deduction as a reasonable and ordinary cost of doing business. It may actually cost you less to provide key employees with the valuable benefits offered by Exec-U-Care. It is also appropriate for employees of 501(c)(3) organizations. As with any tax matter, you should discuss this with your personal tax advisor.

of the accident. In the event of multiple injuries resulting from any one accident, only one benefit is payable -- the largest amount applicable. Dependents are not covered by the AD&D benefit.

most deserving. Each person insured by Exec-U-Care (employees and dependents) must remain covered by an underlying health plan which provides certain minimum benefits. What Are The Requirements Of The Underlying Health Care Plan? Every person insured by Exec-U-Care (employees and dependents) must remain covered by an underlying health plan. The following minimum benefits are required: · Lifetime maximum benefit: $250,000. · Calendar year deductible: Up to $1,000. · Co-payment (non-PPO plan): Not to exceed 20% of the person's first $10,000 of eligible charges beyond the deductible each year. · Co-payment (PPO plan): Not to exceed 20% for PPO services or 40% for non-PPO services, for the person's first $10,000 of eligible charges beyond the deductible each year. · Eligible major medical charges must include semi-private room and board (in full), intensive care (in full) and extended care (in full). The basic plan must provide coverage for usual, customary and reasonable charges for all professional services and supplies including, but not limited to, physiotherapy, nursing care, laboratory and X-ray examinations, drugs and medications, and ambulance services. However, no underlying dental or vision plan is required. What About Families? The spouse and eligible dependents of a covered employee are automatically covered for the supplemental medical benefits (but not for the AD&D benefits). What Medical Expenses Are Covered? 2 Depending on what's covered by your basic health plan, Exec-U-Care typically pays for: · Deductibles, coinsurance and co-pays; · Dental care and orthodontia; · Eyeglasses, contact lenses and other vision care; · Hearing aids and examinations; · Annual physicals and preventive care; · Professional nursing or physical therapy services; · Transportation needed for medical care; · Prescription drugs; · Over-the-counter drugs as allowed by Section 213; · Expenses for nervous and mental disorders; · Treatment for alcohol and drug use.

Exec-U-Care

INCrEASE YoUr EMPloYEES' CoMPENSATIoN PACkAgE bY AS MUCh AS $100,000

For your executives who deserve more, Exec-UCare provides an annual benefit of up to $100,000 per employee or family unit for unreimbursed medical expenses during a calendar year (subject to a $10,000 per occurrence limit). Here's how: ExecU-Care reimburses employees, and their eligible dependents, for medical expenses not covered by your group major medical plan, or by any other group health plan or government program. Depending on the provisions of your group major medical plan, your employees with health care plans may normally be responsible for expenses such as deductibles, coinsurance amounts, special health equipment, annual physicals, dental care, vision care and more. Exec-U-Care pays for many of these "extras" by reimbursing employees for their out-ofpocket expenses for medical care. These payments create a bonus by putting those dollars back into your employees' pockets to spend as they please.

TrAvEl AT EASE WITh TravelConnectSM

®

PlUS . . . ThErE'S MorE! A PrESCrIPTIoN DrUg DISCoUNT CArD ThAT'S AS gooD AS golD (oPTIoNAl)

When purchasing Exec-U-Care coverage, you may also include a separate benefit called the Gold Prescription Drug Discount Card -- a no deductible, no co-pay discount card. It's one of the broadest prescription coverages on the market today, accepted at more than 90% of the nation's pharmacies. Using the exclusive Gold Prescription Drug Discount Card, an insured employee can pick up a prescription without paying a cent at the counter. The employee simply shows the Gold Card, picks up the order and goes! Prescription charges will be billed to the Exec-U-Care administrator, who will include the drug charges in your company's monthly statement. Executives save time and enjoy the convenience of a cash-free transaction, and employers may be able to save money because prescriptions are filled as a part of PCS Health Systems' client-based network. (Gold Prescription Drug Discount charges are based on wholesale prices plus a dispensing fee.) Each insured employee will automatically be provided with a convenient, individual year-end summary of Gold Card activity.

TravelConnect offers travel, medical, and safetyrelated services for your executives and their families on business or leisure travel. Anytime a covered individual is over 100 miles from home, TravelConnect services are available 24 hours a day, seven days a week.

No matter if a traveler needs a weather forecast for a destination, or an emergency evacuation from a distant location, TravelConnect services are just a toll-free phone call away. Lincoln Financial Group® has contracted with MEDEX Assistance Corporation to provide TravelConnect services. MEDEX representatives can assist with a variety of issues including lost luggage or travel documents, funds transfers, translation services, even emergency security evacuation from a foreign country.

For emergency medical evacuation and repatriation, MEDEX will: · Arrange and pay for a supervised medical evacuation to the nearest health care facility if adequate care is not available locally. · Arrange and pay for a family member to be with a traveler who is alone and hospitalized for more than seven days. · Arrange and pay for a traveler who passes away to be returned to their home location. Neither MEDEX nor Lincoln Financial Group is responsible for the availability, quantity, quality or results of any medical treatment received by an insured traveler, or for the failure of an insured traveler to seek medical services.

Are There Any Expenses Exec-U-Care Will Not Cover? To be covered, expenses must be reasonable charges for medical care as defined by section 213 of the Internal Revenue Code. However, certain limitations and exclusions apply. The Exec-U-Care plan does not cover charges for: · Services that are not medically necessary, or beyond the scope of the provider's license; · Health care expenses which are in excess of a reasonable charge for a service; · Services provided by a family member, or normally provided without charge; · Cosmetic surgery, cosmetic dental procedures or drugs prescribed for cosmetic purposes; · Massage therapy, or hydrotherapy for comfort; or weight loss programs for general health (rather than treatment of a medical condition); · Homeopathic preparation, vitamins and dietary supplements available without a prescription; · Housekeeping or companion services; health spa vacations, camps or retreats; or health club memberships; · Premiums, contributions, subscriber or capitation fees an insured or dependent pays for the employer's base medical plan (or Medicare or Medicare Supplement Insurance) and any dental, vision or prescription drug plan or other health care plan. · Purchase of non-medical equipment or modifications to the home, yard, motor vehicle or workplace (such as air conditioners, humidifiers, exercise equipment, ramps, lifts, sun lamps, hot tubs or swimming pools); · Services covered by a government program (such as workers' compensation or Medicare); · Treatment of a condition resulting from military service or war. Under the AD&D coverage, Exec-U-Care does not cover losses due to self-inflicted injury; sickness or medical treatment; rioting or participation in or attempting to commit a felony; military duty or war; non-commercial air travel or participating in aeronautical sports, or while under the influence of drugs or alcohol. (For a complete list of exclusions and limitations, call the Exec-U-Care administration offices at 1-800-552-1213.) Will Employees Pay Taxes On Benefits? When you use Exec-U-Care as the funding vehicle for your health care reimbursement plan, benefits are not taxable to recipients in most situations. This is just one of the advantages of an insured plan over a self-funded plan. Payments under a discriminatory self-insured reimbursement plan are taxable, but payments under an insured reimbursement plan like Exec-U-Care are

rECrUIT AND rETAIN oUTSTANDINg EMPloYEES

As a recruiting tool, Exec-U-Care helps make employment with your company more attractive and lucrative. As an extra incentive to current key employees, Exec-U-Care gives you the freedom to reward only those people who have truly earned special recognition.

$100,000 oF vAlUAblE ACCIDENTAl DEATh AND DISMEMbErMENT INSUrANCE ProTECTIoN

Insured employees are covered 24 hours a day, anywhere in the world, on business or pleasure. If an employee dies as the result of a covered accident, the full $100,0001 is payable to the employee's beneficiary. If the employee loses a limb or eyesight, a portion of the $100,000 maximum benefit will be paid depending on the nature of the injury. The loss must occur within 365 days of the date

ANSWErS To YoUr qUESTIoNS AboUT ExEC-U-CArE

Who is Eligible To Be Covered By Exec-U-Care? You decide which qualifying employees you want to cover. Exec-U-Care is designed to give you the freedom to reward those employees you feel are

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AD&D benefits reduce 70% when the employee reaches age 70, and benefits end when the employee reaches age 80. For any retirees, surviving spouses or board members you elect to insure, AD&D coverage terminates at age 65.

Whether the $50,000 or $100,000 plan is selected, please note the per occurrence limit is 10% of annual max (i.e., $5,000 or $10,000).

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