HSA Group Overview

1. HSA Group Overview

2. HSA Group Overview • Healthy Blue ChoicesSM plans provide integrated solutions that will revitalize your health care options. Fast forward your company to the next generation in health care with a health plan that combines: • Innovative plan design Brings together quality benefit plans and health care savings accounts to help your employees make responsible health care decisions • Enhanced care delivery Uses the strength of our extensive network of doctors and hospitals to provide quality care to your employees • Dedicated health support Focuses on total health through care management, health education, and support and wellness

3. Guide to Group Setup • Overview • Setting up your benefit plan is critical. So, Blue Cross Blue Shield of Michigan has created a process that helps you accurately code and verify your group’s plan benefits online. This guide explains how to set up your group Healthy Blue HSAplan with the Blues and The Bancorp Bank.*

4. Guide to Group Setup • HSA enrollment timeline • A Blues project manager who specializes in new national account business will lead the team creating your plan forms, membership database and employee accounts. It may take up to 30 days to create all the elements of your group plan.

5. General Administration Services • The Blues provide comprehensive Healthy Blue HSA administrative services: • Record-keeping services: average balance calculations that include consideration of check deposits with delayed availability, transaction history and the calculation of interest using average daily balances • Employee accounts: an interest-bearing deposit account and a market-based, long-term investment vehicle for HSA balances • Group, employee and agent customer service center resources to handle all account inquiries and transactions • Fulfillment services • Debit card issuance • HSA account funding: Wire or Automated Clearing House deposits and mail-in deposits • Online banking for account balance, transaction history, bill payment, investment enrollment and investment elections • Employee 5498-SA and 1099-SA federal tax forms

6. Enrollment • Group and employee enrollment • After you have completed the Healthy Blue HSA Group Setup Form and employees have selected Healthy Blue HSA, the Blues will send your group eligibility files to Bancorp. Bancorp will activate each employee’s HSA account upon receiving the eligibility file. You will set up payroll deductions, if applicable, with your employees.

7. HSA Funding • We have many options available for depositing employee and group funds to the employee’s HSA account. There are no minimum deposits or opening deposit requirements. • Group: You can decide whether to make contributions to your employee’s accounts. The decision is yours. We will take contributions at whatever level and timing meets your needs.

8. HSA Funding (continued) • Employee: • The typical HSA plan includes employee contributions. We can configure the timing of these contributions to meet your needs. Combined group and employee HSA contributions are limited by Internal Revenue Service statutory maximums. • The maximum annual contribution for 2010 is $3,050 for single coverage or $6,150 for family coverage. These amounts are adjusted for inflation each year. • Employees who are 55 and older may make additional catch-up contributions of up to $1,000 for 2010. Employees should consult their independent tax advisers to confirm this information.

9. Group Funding Options • Detailed instructions for each of these processes is available at healthybluehsa.com under Employer Tools. • Direct deposit: • Groups may work with their payroll processors to set up direct deposit into their employees’ health savings accounts. These may be group or employee contributions, or both. To facilitate this process, groups can request a list of all employee health savings account numbers from their sales agents, if needed. Employees may establish their own contributions with a direct deposit form available on our Web site and returned to the group with a voided HSA check. Bancorp processes these deposits as they are received, with no prior notification necessary.

10. Group Funding Options (continued) • ACH or wire contributions: • Groups may request that their financial institutions process an ACH or wire, and then e-mail contribution forms to Bancorp at DepositResearch@thebancorp.com.* (The file can also be sent via Secure File Transfer Protocol for groups with frequent deposits. Please speak with your representative for more information). Any wire received before 3 p.m. Eastern Time is processed the same day. Bancorp will send a confirmation that funding was processed to the e-mail address that sent the contribution form. *BCBSM does not control this Web site or endorse its general content.

11. Group Funding Options (continued) • Check or money order contributions: • You complete the contribution form to include each employee’s name, account number and deposit amount. Bancorp credits each employee’s account within 24 hours of receiving the form. If you include an e-mail address, Bancorp will send confirmation of funding electronically. • Online HSA employer funding tool: • This ACH option allows you to deposit money into employee accounts free of charge. The funding through this online tool can occur in one lump sum or recurring on a monthly basis. This method is available for groups with 25 or fewer employees.

12. Workflow Diagrams and Funding Options • Please ask your Blues sales representative or agent for a workflow diagram of the contribution method you have selected. • Employee funding options: • Employees will receive information about funding options in their welcome kits. They may also check online at healthybluehsa.com to learn more about depositing funds into their accounts through any of the following methods: • Direct deposit through payroll deduction • E-Money Mover • Check or money order • Credit card • Electronic transfers • Wire • Automatic teller machine

13. HSA Distribution Methods • Your employees have a variety of ways to use their accounts, including: • Debit cards: Employees use the card just like any other debit card, allowing them to draw on their HSA funds at the time of service. • Online reimbursement: As an alternative to debit cards, employees can make payments at the time of service, or when billed, using their regular bank debit cards or checks connected to their regular checking or savings accounts. Employees can reimburse themselves from their HSA accounts by transferring HSA funds to their regular checking or savings accounts.

14. HSA Distribution Methods (continued) • Your employees have a variety of ways to use their accounts, including: • Online bill pay: Employees can use our online bill payment service to pay a health care provider or reimburse themselves. • Checks: Employees will receive a free book of 50 checks to access funds in their account. Checks may be used to pay medical service provides or to reimburse them when they’ve paid for items out-of-pocket.

15. HSA Investments • Overview • Bancorp provides your employees with the option of investing a portion of their HSA deposits into shares of mutual funds offered by an external, independent investment management firm. Your employees have the ability to access their account information over the phone or online. • Employees can view their HSA investment accounts online, with the ability to see current positions and fund prices, buy and sell mutual funds and individual equities, view fund fact sheets and online prospectuses. There is no monthly fee for investing services. • The brokerage account is completely self-directed, and employees must meet all qualifications to open their accounts. Investment accounts are maintained at National Financial Services, a wholly owned subsidiary of Fidelity Investments. Cash balances transferred to the investment accounts are not insured by the Federal Deposit Insurance Corp., are not guaranteed by the bank, are subject to market risk and may lose value.

16. HSA Investments (continued) • Eligibility • Employees choosing to open an investment account must reach a minimum balance of $2,500 in their health savings accounts. The minimum required amount for each trade is $100. There is a $10,000 daily trading limit on each account.

17. HSA Investments (continued) • Transactions • Employees with investment accounts are able to invest HSA holdings into mutual funds and individual equities, reallocate the investments within the account, liquidate investments and transfer the funds to their health savings accounts. The health savings account and the brokerage account are electronically linked, allowing funds to move between the two accounts with no additional paperwork. • National Financial Services will send statements and trade confirmations to each employee, reflecting all trading activity. The mystreetscape member Web page provides multiple tools and search functions. Employees are able to see all previous and current trading activity here.

18. Statements and Reporting • Bancorp will issue HSA statements monthly when there is account activity and quarterly when the account has no activity. Employees may choose to receive electronic statements to access the information via the member Web site. Employees will stop receiving paper statements once they request electronic statements. • National Financial Services will send statements and trade confirmations to each employee who has an investment account. • Employees may view their accounts online 24 hours a day, seven days a week. They can view their transaction history by selecting the date range they wish to view, including a running balance of cleared transactions.

19. Employee Actions • Your employees will receive a total of five separate mailings: • Welcome kit, including an online user ID • Password for online access (This may be sent electronically if an e-mail address is available.) • PIN for debit card cash access • 50 checks • Visa debit card • The welcome kit includes: • Signature card • Frequently asked questions and answers • List of eligible medical expenses • How to log in • Making deposits • Online tools overview • Business reply envelope • Deposit slip

20. Employee Actions (continued)

21. Online Access • Your employees will have access to their HSA by logging in to healthybluehsa.com with the user ID and password they receive from Bancorp. • Employer Tools • Being experts in account administration, we have developed an Employer Tools area within healthybluehsa.com, containing all of the forms and resources necessary to start and maintain an HSA plan. Bancorp also provides Web-based HAS training by request for administrators or their employees. • You may request reports automatically be sent by e-mail; therefore, there is no need for groups to set up a user name and password to access tools or any reporting data. Bancorp is able to provide aggregate reporting, such as total accounts, total balances and average balance figures. Please communicate any reporting needs to your BCBSM account manager.

22. Online Access (continued) • Member website • We provide your employees access to a member Web site, offering them the opportunity to review account information, including balances and recent transactions. They can review the status of claims they have submitted for reimbursement, along with detailed transaction information. • The member site also provides answers to frequently asked questions and a glossary of terms. Many useful forms are also available online to print and submit, such as requesting claims reimbursement or changing beneficiary information. • You may request reports automatically be sent by e-mail; therefore, there is no need for groups to set up a user name and password to access tools or any reporting data. Bancorp is able to provide aggregate reporting, such as total accounts, total balances and average balance figures. • Please communicate any reporting needs to your BCBSM account manager.

23. Customer Service • For employees • If your employees have questions or need assistance, they can call the number on the back of their Blues ID cards. Employees who don’t have Blues ID cards can call the number provided by your sales agent. • For groups • As enrollment in Healthy Blue HSA continues to grow, the Blues provide our groups with a unique resource to help support new group startup and ongoing account management. We have established a CDH Administration unit to support you in the enrollment process and to be your liaison with our banking partner.

24. Customer Service (continued) • Services provided by CDH Administration include: • Support with HSA setup documents required during the implementation process • Attendance at customer meetings to discuss the implementation process • Resolve group implementation and post implementation issues • Support account managers in working with Bancorp • You can reach the CDH Administration unit at cdhadministration@bcbsm.com.

25. Questions • Now you have all the information you need to implement your Healthy Blue HSA health plan. As your partner in health care, the Blues are here to support you every step of the way. If you have questions or need more information, call your Blues account manager or contracted agent.